Journal Article

Using new markets tax credits to mitigate the impact of foreclosures on communities

Abstract: Across the country, committees have been established to come up with ways to mitigate the impact of foreclosures on lower-income communities. A few are exploring the feasibility of having community-based organizations use the New Markets Tax Credit (NMTC) Program to facilitate the purchase of foreclosed residential properties for rehabilitation and resale to low- and moderate-income families. In theory, these organizations could use the tax credits to help recover their costs for purchasing, fixing up, and selling homes at a price that is affordable to lower-income buyers. Moreover, the tax credits could help community-based organizations attract appropriate amounts of capital to conduct transactions at a scale that would stem disinvestment in troubled neighborhoods.

Keywords: Foreclosure;

Bibliographic Information

Provider: Federal Reserve Bank of San Francisco

Part of Series: Community Development Innovation Review

Publication Date: 2009

Issue: 1

Pages: 76-82