published Saturday, March 31st, 2012

Alton Park complaints stir concerns about Purpose Built mixed-income model

Aubrey Fritz speaks about numerous issues he and his neighbors have had with poorly constructed roofs on their homes located in the Villages at Alton Park neighborhood.
Aubrey Fritz speaks about numerous issues he and his neighbors have had with poorly constructed roofs on their homes located in the Villages at Alton Park neighborhood.
Photo by Dan Henry.

People who bought homes a decade ago in the Chattanooga Housing Authority's mixed-income development known as the Villages at Alton Park thought they were getting a deal. Now they're not so sure.

"Some things promised to us, they (Chattanooga Housing Authority) didn't keep their end of the bargain," said Villages at Alton Park homeowner Aubrey Fritz.

Fritz and most of the other 42 homeowners who live there expected that 125 single-family homes would eventually be built in the city's first federally funded mixed-income community.

People on subsidized housing would have opportunity to live in a community not as densely populated with poverty. Homeowners like Fritz would get federal incentives allowing them to purchase a $110,000 market rate home for $71,000.

But less than two years after Fritz bought his home, he said shingles started coming off the roof and water circles started forming on his ceiling because of roof leaks. Others say that cracks have appeared in their foundations and walls.

And the 125 homes once anticipated will never be built. Housing officials got approval from HUD in 2010 to change its initial plan and only 44 homes were built and sold.

Now, nearly seven years after the Villages at Alton Park opened in 2005, homeowners worry that physical problems with their homes and new low-income housing being built nearby will lower their property values and ability to sell.

These are issues that reach beyond this handful of homeowners. CHA is considering using the Atlanta-based Purpose Built mixed-income model for more community revitalization in Chattanooga. The model calls for having market rate renters and public housing residents blended together.

The vacant lot in the Villages once intended for more single-family homes remains empty. Construction is under way on the lot across the street behind the villages for an 88-unit apartment building for low-income renters.

"As stakeholders, we were lied to," said Fritz. "There was supposed to be a balance of renters and homeowners. Now we're going to be surrounded by subsidized housing."

CHA said in an email that the "existing homes met all of the necessary building code requirements, and are deemed safe, decent and affordable homes by HUD standards."

The housing authority gave a one-year warranty on the homes and said any repairs beyond that is the homeowner's responsibility, Fritz said.

Realtor Gerald Mitchell said a one-year warranty that covers the interior of the home such as plumbing and electrical wiring is common. But he said homes usually come with a builders warranty for at least two years.

Dr. Deirdre Oakley, an associate sociology professor at Georgia State University who has studied mixed-income developments, said a homeowner's property value in the villages should not be judged by the rental properties around it.

And it could be perception that the homes are lacking in quality, she said.

"The contractors are under lots of stipulation in terms of what to build and codes, so it could just be perception. The housing very well could be quality housing. There are HUD regulations," she said.

A NEW MODEL

CHA and housing agencies across the nation are moving toward the mixed-income model of housing as a way to break up concentrations of poverty and crime that can plague public housing developments.

At least in policy circles, mixed-income communities are viewed as a success. In the five years that Oakley has been at Georgia State, she said she hasn't heard any complaints about the quality of housing for homeowners.

Oakley said mixed-income developments in themselves don't pull property values down. What matters is what else is in the neighborhood.

"Is it close to amenities? What does the neighborhood outside the complex look like?" Oakley asked. "It's a misnomer for homeowners to think that the subsidized units are pulling values down. That's not the case."

However, Mitchell cautioned that having a single-family home surrounded by rental properties can diminish property values. He said renters tend to come and go more, making the community more unstable.

He also said he understands the homeowners' concerns about property value. In 2006 the homes at the villages ranged from $112,000 up to about $130,000. But since the housing market crashed around 2007, the same homes are selling for $89,000 or less, he said.

The homes have desireable amenities, countertops that come with the range, garage in back, two baths, and a microwave and refrigerator that come with some houses.

"Because of the market, the appraised value is probably going to be less than what the actual value is," said Mitchell.

Homeowners in virtually all markets have experienced that problem as the housing market struggles to turn around.

Since 2008, Oakley has been tracking 350 former Atlanta public housing residents to determine what happens to them after their housing has been demolished.

She found that most market rate renters and homeowners in the Atlanta area are pleased with their homes.

CHA's mixed-income community differs from the mixed-income Centennial Olympic Place in Atlanta because the number of market rate and affordable renters and homeowners in the Atlanta community outnumber those in subsidized housing, said Oakley.

Rick White, spokesman for the Atlanta Housing Authority, agreed.

In Centennial "homeownership is over and above the rental homes," White said. "The number of for-sale homes is driven by the market. There is no formula for ownership like there is for rental."

ACCOUNTABILITY

Of the 44 homes that have been built in the Villages at Alton Park, a third of the homeowners volunteered to publicly comment about structural problems with their homes and concern about not having more single-family homes in the villages as initially planned.

Other homeowners also complained of structural inadequacies, but didn't want to speak publicly because they want to sell and are concerned that negative publicity will hinder the sale of their homes.

Still others said they are happy with their homes.

Milton Clark is not.

"My foundation is cracking," said Clark. "And right now inside the house we're starting to get cracks in the walls."

Clark has owned his home since 2006. The warranty expired in 2007. Cracks in his foundation appeared in 2008, he said.

Clark said contractors did a shoddy job, and no one is held accountable.

"They made their money and they all got out and everybody's trail is covered," he said.

Mitchell is one of two Realtors trying to sell a home in the 200 block of West 37th Street.

In 2006 homes in that area sold for $112,000 to $130,000. Today, the asking price is $88,000, said Mitchell. Housing officials said homes initially sold for $80,000 to $120,000.

And the last nail in the coffin for property value in the Villages at Alton Park, according to Fritz, is the 88-unit apartment complex being built behind the site on a lot formerly owned by CHA.

"I don't know about you but I wouldn't want to buy a home knowing that my backyard will face an 88-unit low-income housing complex," Fritz said.

Bacar Construction field superintendent Tommy Moore said the property will be complete in December. All residents in the units must meet certain economic guidelines.

"There is a dire need for additional affordable housing in our community, and this new project will provide more options for working families with limited incomes," said CHA in an emailed statement.

about Yolanda Putman...

Yolanda Putman has been a reporter at the Times Free Press for 11 years. She covers housing and previously covered education and crime. Yolanda is a Chattanooga native who has a master’s degree in communication from the University of Tennessee and a bachelor’s degree in journalism from Alabama State University. She previously worked at the Lima (Ohio) News. She enjoys running, reading and writing and is the mother of one son, Tyreese. She has also ...

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