Good Neighbor Program

In an effort to expand its partnership with local governments in helping to foster housing opportunities for low to moderate income families and address specific community needs, HUD is introducing its Good Neighbor Program. This program facilitates the sale of aged HUD inventory of single family homes to local governments for ONE DOLLAR ($1.00).

TO LEARN MORE ABOUT THE $1 HOME SALE PROGRAM, click on the link below: 
http://www.hud.gov/offices/hsg/sfh/reo/goodn/dhmabout.cfm

Properties which have been offered to the public for sale for six or more months and are not presently under a sales contract will be removed from the market and offered exclusively to local governments for a period of ten days at a sales price of $1.00 plus closing cost. The property must have been offered to the public for at least 180 days to be eligible. Days on which the property is held off market as a result of a pending sale or other reason do not count toward the 180 day total. To be eligible to participate in this new sales program, local governments must:

-   Identify the intended disposition strategy and clear public purpose goals and objectives it will pursue with properties purchased through this program;

-   Affirm that all profits/proceeds of sales of HUD homes will go to support local housing/community development initiatives;

-   Identify what specific programs or uses these profits/proceeds will support; and

-   Agree to provide HUD's Homeownership Center (HOC) Program Support Staff Director with an annual report on all properties purchased under this program. The report must include information on the ultimate property purchaser, the amount of profit realized on the final sale and where the profit was put back into local housing/community development.

As part of its disposition strategy, the local government may indicate that it intends to purchase the property and convey it to a nonprofit organization for rehabilitation and resale to first time homebuyers, low to moderate income buyers or some other public purpose objective. This is an acceptable approach, however, local governments should be reminded that all information pertaining to the purchase and subsequent resale must be included in the annual report provided to HUD's Program Support Staff Director. Failure of the local governments to comply with any of the above requirements may result in their removal from participation in this program.

Nonprofit organizations and entities such as housing authorities are not permitted to directly purchase properties under this sales program. They are, however, encouraged to partner with local governments in reaching the disposition goals and strategies for these homes.

Properties will be made available to local governments on a weekly basis with new properties being added as they reach six months of market exposure. Local governments should check this site each week to see what properties have become available in their jurisdiction. LOCAL GOVERNMENTS ARE ONLY ELIGIBLE TO PURCHASE HOMES WITHIN THEIR JURISDICTIONAL LIMITS. The listed properties will remain available exclusively for purchase by local governments for 10 calendar days.

To purchase an eligible home, the local government must execute and deliver the form HUD-9548 Sales Contract with the required special addendum to:

-   BestAssets, 501 Marquette, Suite 1200, Minneapolis, MN, 55402

The Sales Contracts are multi-part forms and are available at the BestAssets office

The Sales Contract may be downloaded by clicking HERE.

The Addendum may be downloaded by clicking HERE.

ORIGINAL SALES CONTRACTS WITH THE REQUIRED ADDENDUM MUST BE RECEIVED BEFORE 4:30 PM ON THE DATE INDICATED AS THE "DEADLINE". You will see this date on the property list for each property exclusively available to local governments. Late contracts will not be considered. Please note that there is no other way of indicating your interest in or intention to purchase the property. We are not able to accept telephonic, fax, or electronic indications of interest.

To the extent that more than one local government (e.g., city and county) wish to purchase the same property, the first complete contract package received will be awarded the property.

If sales contracts are received within the required time period but contain errors requiring correction, BestAssets will notify the local governments of the required changes and allow five days for the submission of a corrected sales contract. Failure to submit corrected documents within these five days will result in contract cancellation.

If local governments do not submit a sales contract within 10 days, the properties (other than multi-unit properties) will then be offered exclusively to Officer Next Door/Teacher Next Door participants for an additional 10 day period. OND/TND discounts WILL apply to the new list price. If properties remain available for sale after this offering, the properties will be returned to the public list and local governments may then submit offers to purchase these aged properties for $1. Consideration will only be given to these offers if no other acceptable offers have been received from the public. 

Upon review and analysis of the contract package, BestAssets will sign the contract (as Attorney-in-Fact for the Secretary of HUD) and forward the contract to HUD's Closing Agent. You will receive a copy of the signed contract and the local government will be responsible for contacting the Closing Agent to arrange the closing. The local government will be responsible for all closing costs incurred in the transaction other than the Closing Agent's fee and wire transfer expenses, if any. 

Restatement of HUD's "AS-IS" Sales Policy: Local governments are reminded that all HUD properties are sold "as is". HUD believes that an "as is" sale is the fairest, most straight forward sales method. However, even though HUD sells its properties "as is," it is HUD's policy, as a good neighbor, to keep the properties safe and secure, and to preserve and protect the property while it is being marketed. 

Liens and Assessments: In those instances where a local government has assessed liens against the properties and/or fines have been assessed by a unit of local government, the local government must take the necessary steps to remove these liens at no cost to HUD prior to closing the sale. 

Demolitions: It should be noted that the local government may recommend the demolition of any property which is currently available for purchase by that entity. To consider demolition, the following criteria must be met:

-   HUD's last listed price, plus the cost of rehabilitating the property to meet HUD's Minimum Property Standards (MPS) is more than 130 percent of the after rehabilitation value. The determination of rehabilitation cost and the after rehabilitation value may require BestAssets to procure the services of a structural engineer, appraiser, and/or special inspectors. The appraisal must include the fair market value of the land.

-   The cost of demolition may not exceed the cost of rehabilitating the property to meet MPS.

-   Review the Environmental Compliance Record to determine whether the property is listed on the National Register of Historic Places or located in a Historic District. If the property is classified as "historic", review any conditions on the disposition of the property to determine whether demolition is permitted. If so, follow any conditions imposed in conjunction with the demolition.

In the event that the BestAssets and HUD are in agreement that the above criteria have been satisfied, demolition of the property will be completed by BestAssets. HUD will pay for the demolition and clearing of the debris.

Following demolition, the land will be listed for sale to the general public for 10 calendar days at its fair market value. Should no acceptable offers be received from the general public, the land will then be offered to the local governments for $1 for 10 calendar days. In the event the local governments have no interest in the land, the property would be re listed on the general listing until the property is sold.