Remember Charlie Rangel’s amazing success with rent-control in New York City? Tim Novak and Chris Fusco have an incredible investigative piece today — a must read in its entirety — on the upscale Chicago housing development put together by allies of Mayor Daley and former Governor Blagojevich.
Realtors, young professionals, civil servants, and even the son of a developer bought low with government subsidies, and then a third of the buyers cashed out within mere months by selling at market prices.
Mayor Daley promised that one-fifth of the homes built as part of the massive makeover of the historic Maxwell Street market would be set aside as affordable housing…
The city never took steps to stop affordable buyers from flipping their homes…Fifty affordable homes were resold by the original buyers for an average profit of $63,710 — including six that resold for more than $100,000 over the original purchase price…The 187 affordable homes are among 4,354 that City Hall has subsidized since Daley took office in 1989. How many are still affordable? City officials say they don’t know: They don’t keep track of that.
Affordable housing programs: Government steps in and the politically well-connected cash in. It’s a different aspect of the much-ignored story from last fall, of how President Obama’s slum-lord donors and his advisor, Valerie Jarrett profited from low-income rental housing subsidies in Chicago and then let the properties they developed or oversaw go to seed.
As federal stimulus money begins to trickle down from Washington, expect many more installments of this story.