MODESTO — The Estrada family lived in apartments for more than a decade. But they never got used to the lack of privacy, the sounds of neighbors talking, televisions, slamming doors and stereos invading their lives.
They wanted to own their own home, a source of family pride and independence, something Guadalupe and Cecilia Estrada one day could pass on to their two daughters. But they thought that would remain a dream. They knew Guadalupe Estrada's wages as a forklift operator in a frozen-foods warehouse were not enough to turn that dream into a reality.
That was before the city of Turlock helped the Estradas buy their first home, a 1,174-square-foot, three- bedroom, two-bath house built in 1985. It sits along a quiet street in the city's south side.
"I feel proud to say that my dad bought it for us and I feel proud that it's something that we own," said 17-year-old Jessica, the Estradas' eldest daughter.
The money Turlock used to help the Estradas came from a U.S. Department of Housing and Urban Development program created to help states, counties and cities deal with blight and other problems caused by the foreclosure crisis. The Neighborhood Stabilization Program was designed to provide affordable housing for low- to moderate-income families.
Some $86 million in NSP funds has poured into Northern San Joaquin Valley cities and counties over the past few years. Stanislaus County and many of its cities received most of the funding nearly $50 million, with about $25 million flowing into San Joaquin County and a little more than $11 million going to Merced County.
Officials say this is the biggest, most rapid infusion of federal money into the valley in recent memory. Carol Whiteside, a former Modesto mayor, said she can't recall anything of this magnitude in the past 20 to 30 years.
Help for hundreds in county
The Estradas are among the few hundred families in Stanislaus County that have found or will find decent, safe, affordable housing through the program.
When the NSP concludes, about 430 units of housing, such as single-family homes and apartments, will have been built or rehabilitated in Modesto, Turlock, Ceres, Newman, Oakdale, Patterson, Waterford and unincorporated areas of Stanislaus County.
That may seem meager compared with the number of homes lost in the real estate crash. Lenders foreclosed on roughly 81,000 homes in Stanislaus, Merced and San Joa- quin counties from 2007 through last year, with about 28,000 of them in Stanislaus.
But NSP proponents say the program has had a real impact. The $50 million that came to Stanislaus County was used to hire electricians, plumbers, construction workers and roofers who built and repaired homes and apartments.
"In the last two years, the only significant housing activity in the city was NSP," said Julie Hannon, director of Modesto's parks, recreation and neighborhoods department. She added that NSP contractors bought local goods, further stimulating the local economy.
Public funds brought guarantees
Builder Steve Madison said private developers might have used the $50 million more efficiently and built and improved more housing, but that misses the point.
"Some people wanted to be critical of the program, that it should have been run as private-sector enterprise," said Madison, a former executive director of the Building Industry Association of Central California who now runs the Stanislaus County Affordable Housing Corp. (STANCO).
But he said the funding came from the federal government, which meant local governments had to abide by a host of rules and regulations in how they spent the money rules and regulations that private-sector builders using private-sector money would not have to follow.
Madison added that the NSP was designed to produce housing that would last for a long time. For instance, STANCO is using $2.1 million from Modesto's NSP funding to build Bennett Place, a $5.4 million apartment complex for low-income, mentally ill tenants. Madison said Bennett Place is required to provide affordable housing for the mentally ill for 55 years.
Proponents say the NSP did stabilize neighborhoods when a city or the county bought a foreclosed home that had become an eyesore and improved the property before reselling it. The NSP also made homeownership possible for families that might not otherwise be able to afford their own home.
The program came when the valley was in the depths of the foreclosure crisis, the unemployment rate was spiking and residents feared another economic catastrophe.
"It stopped the bleeding to a certain extent and stabilized things so they did not continue to deteriorate," Whiteside said.
Neighbors are pleased
Two of the Estradas' neighbors on Hartley Lane said they are happy with what Turlock did to a foreclosed home that sat empty for at least a couple of years on their street before the Estradas bought it a year ago.
The neighbors said the house was becoming an eyesore and hurting property values. Before selling it, Turlock hired contractors whose renovations included redoing the stucco, replacing the roof, installing new windows and painting the house inside and out. The work included fixing up the interior.
"The house was a little run-down," neighbor David Threet said. "It's a nice-looking house now."
The Estradas paid $110,000 for their home. They qualified for an $88,000 conventional mortgage and the city provided what it calls a gap loan for the remaining $22,000.
The Estradas pay $630 a month for their mortgage. They don't have to make payments on the gap loan for 30 years. At that time, they can pay it off or the city will let them make monthly payments over a number of years.
The city structured the financing so that no more than 38 percent of the Estrada's gross monthly income goes toward their mortgage and other debts such as a car payment. That was done to keep the house affordable, said Maria Ramos, a housing finance specialist with the city.
The Neighborhood Stabilization Program has been a boon for affordable housing.
"I think that definitely for many of us in the trenches, it increased our capacity to serve households," said Anita Hellam, executive director of Stanislaus Habitat for Humanity. "In a recession environment, with funding declining, I was able to grow."
Subdivision in the works
Habitat expects to start construction this month on River Vista, a roughly $3 million, 21-unit housing subdivision on Signature Court by Sunset and Roselawn avenues in west Modesto. About a third of the project's funding came from Modesto's NSP money.
Habitat has done a handful of other NSP homes. River Vista will boost the number of homes Habitat has produced during Hellam's decadelong tenure to about 90.
As of mid-February, the Housing Authority of the County of Stanislaus had spent more than $24 million in NSP funding provided by Modesto and Stanislaus County to buy 135 foreclosed homes. About three-quarters have been or will be rehabilitated and sold. The remaining quarter are rentals.
The Housing Authority is using NSP money to build apartment complexes in Waterford, Ceres and Modesto for low-income seniors.
"When you consider the single-family homes in the mix, that would seem like a very high number," Housing Authority Executive Director Bill Fagan said. "Five or six years ago, virtually none of those families could have afforded to buy."
Bee staff writer Kevin Valine can be reached at firstname.lastname@example.org or (209) 578-2316.
Stanislaus County: $49.93 million
San Joaquin County: $25.46 million
Merced County: $11.19 million
Total: $86.58 million
Note: The amounts include money received by a county as well as cities within a county. For instance, Modesto received $36 million of the Stanislaus amount, and Stockton received $16.4 million of the San Joaquin amount.
Source: U.S. Department of Housing and Urban Development and California Department of Housing and Community Development
Modesto: $36 million
Turlock: $1.5 million
Stanislaus County: $13.9 million
Note: The county received the money as the lead agency in a consortium that includes the cities of Ceres, Newman, Oakdale, Patterson and Waterford.
Source: The cities and county