In DC, public-housing tenants forced out, then homes flipped

Associated Press

WASHINGTON

In the rapidly gentrifying nation’s capital, real-estate investors aren’t the only ones flipping houses for profit. The city’s public housing authority is getting in on the action – moving aging tenants out of homes where they’ve lived for decades, renovating them and selling them to wealthy buyers.

The renovations, at a cost of more than $300,000 per home, are outfitting the houses with luxury amenities, and some of the houses have sold for nearly $900,000. Others, however, have sat vacant for a year or longer after tenants were forced out.

The housing authority plans to use the profits to renovate existing subsidized rental units and build new ones. But most of that work hasn’t started, and none of the money has gone to new construction yet, according to the agency. Meanwhile, sales have been slow-moving and haphazard.

Some elderly tenants and their children have asked for an opportunity to purchase the homes, only to be rebuffed, even after spending thousands of dollars maintaining the rental properties.

The homes are known in public-housing circles as “scattered sites” – single-family properties around Washington that are rented to public-housing tenants. Many are in desirable neighborhoods, including Capitol Hill and Shaw, where median home prices have more than doubled in the past 15 years to $500,000-plus.

The District of Columbia Housing Authority once had more than 300 scattered sites and has been slowly selling them off since the 1990s. But in 2010, when the city’s real-estate market began to rebound after the Great Recession, the agency started treating the properties as real-estate investors would – gutting, rehabbing and selling them for as much as the market can bear. Previously, the homes were sold to low- and moderate-income buyers or to nonprofits that maintained them as affordable housing, a practice common to housing authorities nationwide.

A year ago, Levant Graham, 84, was moved out of the five-bedroom home in Shaw where she’d lived since the early 1970s and raised seven children. The housing authority plans to flip the house, but so far it hasn’t been renovated or listed for sale.

“I thought the house was already sold. I thought it was on the market. So, I don’t know what the big rush was to get me out of the house,” Graham said.

Graham petitioned housing officials to buy the property with her children’s help. Instead, she was moved into a one-bedroom apartment in a new building for low-income seniors. The building is in a gentrifying part of Shaw not far from her old house, but she says she doesn’t feel safe because of a shooting nearby and rarely goes outside.

“The money that I paid there for the 42 years I was there, I could have had the house paid for,” Graham said. “I thought I had a good chance of getting the house, but I guess I didn’t.”

District of Columbia law gives tenants of rent-controlled or market-rate buildings the first crack at buying them if they’re placed on the market. But the law doesn’t apply to the housing authority or its tenants because the agency is independent, leaving residents with no legal recourse to argue against being moved.