The stimulus money the feds have released into the economy has had a huge impact on the real estate market, including allowing cities to use the fund to purchase low income housing. The purpose for this is simple, it is designed to help the real estate market while supporting the poor in the communities.
With the economy sinking so low and unemployment engulfing the job market, for the government to do this is a step in the right direction. Without this boost the city governments may not have acted quickly enough to make sure they could house all of the poor people right now.
Without the recent changes, a city would have to contract for a certain agreed upon payment for the rental property and then, reluctantly, property owners may agree to allow the poor families to rent from them.
Some of the occupants of this kind of housing are disabled and need special care, or they may just be people who are unemployed and need help getting back on their feet. Residence in this type of housing is typically short term so that people do not overstay their welcome, unless conditions demand a longer stay.
The owners of the low income housing can qualify for special tax exemptions for agreeing to allow their property to be used to house the poor. To make sure that participating property owners do not get the shaft in dealing with the low income housing participants, the government guarantees the rent will be collected and paid to help defray concerns on participating.
Upstart investors frequently seek out low income housing programs when they get started buying and selling properties so that some of their risks are diminished. This furthers the notion that everyone involved will come out ok when participating in low income housing programs.
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