Real Estate February 10, 2010 1:01 PM

First Home Sold at St. Stanislaus Gardens

First Home Sold at St. Stanislaus Gardens

It took longer than expected, but an unsubsidized new home at 138 Townsend Street has sold.  The single-story residence across from St. Stanislaus Church was purchased for $110,000.  For developer Mike McHugh, selling the first of what he hopes to be many more has been a learning experience. 

McHugh is owner of McHugh Contracting and has built a niche in church restoration, painting and repair.  After spending four years working on the restoration and stabilization of St. Stanislaus Roman Catholic Church, McHugh was encouraged by then pastor Bishop Grosz to focus on rebuilding the surrounding community.  Their plan was to build affordable single-family homes in the church's Broadway-Fillmore neighborhood where vacant lots outnumber occupied homes on many streets. 

"We are trying to do positive things in the neighborhood," says McHugh.

Working with Councilman David Franczyk and Mayor Brown, McHugh purchased 26 vacant city-owned parcels on Coit, Detroit, Townsend, Peckham and William streets in 2007- enough land to build 14 new homes.  Four different styles of homes with two to four bedrooms were offered, priced from the $80,000's.  McHugh says there is land available to build hundreds of homes in the area. 

The credit crunch put a damper on those plans however.  McHugh built one home and patiently waited for a buyer.

"I had the home sold nine times, but banks wouldn't touch it," explained McHugh.  "People were interested; they just couldn't get a mortgage.  It took seven months to close the sale with the buyer and we had to use a California lender.  Appraisals were an issue.  Every home in the neighborhood is 100 years old." 

The buyers relocated from the Cold Springs neighborhood.  The three-bedroom ranch has 1,100 sq.ft. of living space and an attached two-car garage.  "The husband grew up in the neighborhood and they were attracted to living in a new home on one level due to health issues," says McHugh.  "They are thrilled to be living in the house."

"I lost money on the home, but I knew the first would be the hardest to sell," says McHugh. 

McHugh plans to ask City officials about subsidizing future new homes. 

"Now that I have one sold, that's a start," adds McHugh.  "I am going to watch the economy to see how it goes before starting more.  I'm not going to give up."

Get connected: Mike McHugh, 716.741.8077

DSC_0173c.JPG

View image

Comments

Mr. McHugh, work with the church closer. They have resources to pour millions into the church facade, roof, interior, lighting, etc... They have an annual Dyngus Day party making tons of money and bringing thousands into the neighborhood. Since this project is using St. Stan's name, shouldn't they helping subsidize the project and recruit buyers? If there is no neighborhood what is their future.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

"I had the home sold nine times, but banks wouldn't touch it," explained McHugh. "People were interested; they just couldn't get a mortgage. It took seven months to close the sale with the buyer and we had to use a California lender. Appraisals were an issue. Every home in the neighborhood is 100 years old."


They used to call that "Redlining"

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Re: 'Redlining': It's tricky. I applaud this builder for providing new product here and I'm heartened to hear of demand. It certainly sounds like redlining, but I can sympathize with both sides in this lending equation.

The banks have to justify their lending in the event they have to repossess. Most of the new homes built on the east side over the years sell for considerably less the second time around. The bank looks around and says: nothing sells for remotely close to this figure in this neighborhood. If this buyer goes belly up, what are the prospects we can get out from under? Given recent history, not so good. Technically, the banks aren't redlining if they will lend in the area, and most of them probably would. But they will only lend on what they judge to be the appraised value, which is very influenced by 'comparable sales', which is based on sales of falling down pieces of junk.

Unfortunately, as critics of redlining note, that leads to swaths of urban fabric languishing, as no one can finance anything substantially better than the crap that surrounds it.

I think Roy might be onto something. I don't want to see the church subsidize the homes (or the city, for that matter. If McHugh had nine buyers, then a subsidy doesn't sound necessary. Financing is what he needs). I would like to see St. Stan's give out mortgages, though. Start a credit union and loan the money. Make a profit, all while reconstructing the area. That, or the city of Buffalo could decide to invest some of its surplus into mortgage lending, via a credit union. For that matter, the city might consider commercial lending for all the many commercial properties which fall under the half million dollar minimum loan threshold that most banks require. Not subsidies, not grants, but money making loans and mortgages.

replied to STEEL
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I think the project that the Marlies Wesolowski and the Matt Urban Center project on Sweet St has finally gotten off the ground as a lease to purchase program after having a terrible time getting bank financing.

http://www.urbanctr.org/services/housing.html

replied to biniszkiewicz
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Calling that redlining is more than a bit presumptuous based on the article. Just because someone is interested in getting a mortgage doesn't mean they will qualify. Banks have been cutting back lending because of the economy. Doesn't mean its redlining.

I would like to know what happened to the M&T plan though. The original story claimed that M&T would be offering discounted loans specifically for this project. I understand that banks are looking for less risk right now but it wouldn't hurt to know a bit more about how that fell through.

replied to STEEL
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

The first photo looks like every other house and yard you'll see in the Town of Tonawanda. Yuk!!!! No wonder these are hard to sell. Not everyone wants to live in a plastic suburban house in the city. If we wanted a suburban lifestyle, we'll go to the burbs. If we wanted an urban lifestyle, we'll move anyplace BUT in these east side plastic homes.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I think the house would fit in just fine if the gigantic garage was detatched and moved behind the house and the lot were 1/2 the width. Other than the garage the place looks like a simple but nice craftsman cottage replica.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Not to mention that one can buy a house just like that in Tonawanda for $110,000, with the benefit of not living in an urban prairie. The neighborhood is going to be a hard sell for even subsidized housing.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Actually as noted in the story. Interest in buying the property was not the problem. Financing the purchase was the problem.

replied to Dan
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I love the ignorance on this site. It's very rare to find a home like this in the Town of Tonawanda. There are huge sections of the town where the houses are much older and bigger...much like what you'd see in North Buffalo. You yell and scream when someone makes an incorrect assumption about the city, but then turn around and make the same statements about the suburbs. Tonawanda isn't Clarence or Lancaster. Stop pretending that all Suburbs are devoid of any character and history.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

You're right. Tonawanda seems to have a reputation of middle-class mediocrity, but it's mainly because of its aesthetically challenged commercial districts, the concentration of heavy industry west of Military Road, and the plethora of tract housing that was built between 1950 and 1960. Compared to other metropolitan, there's very little recognition of mid-century architecture in the Buffalo area, perhaps because it's the norm rather than the exception throughout so much of the region. In the Cleveland suburb where I lived, low-interest loans were available specifically for the restoration of mid-century houses.

Most of Tonawanda was laid out in the 1920s, giving its street pattern a level of connectivity that is lacking in most other suburbs. The speculators of the era expected that Tonawanda would be the region's most prominent suburb, and some of the early projects such as Deerhurst, Curtis Park and the blocks along Colvin Avenue reflect the optimism of the early years. A lot of subdivisions dominated by small ranch and Cape Cod houses will have a large stray pre-Depression Colonial Revival or Tudor home among them.

replied to jumpingbuffalo
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

The reason why the streets around there have too many vacant lots is because some of the people around there tend to burn the houses down, or the one next to the one they burn down also catches fire. I'll bet the lender made sure there was enough fire insurance on the deal to cover their losses. I won't pay anything to live there. Extremely dangerous at nights and in summers. $100,000 is way out of proportion to anything else around there, and hardly what I'd call affordable housing in the city.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I have to say I'm surprised at the amount of buyer interest in this project. I would be curious to know some of the statistics (ie % of prospective buyers from the area, how credit worthy they were, etc). Don't get me wrong, I think it is great there is interest in repopulating areas of the City that are struggling but I find it difficult to see the marketability of the area. Yes, they are new homes but it is a risk to live/invest there.

I disagree with the plastic house / suburbs comment. Personally, I don't find these attractive either but I do find them to be reasonable. These are not subsidized so they must be built considering reasonable costs. I think it is important to build up the density of the area by building more affordable homes - then you can build higher cost buildings when demand (and sales price) increase. True, these designs do little to inspire (and the garages seem to act as focal points) but not every house needs to be able to be on a tour of homes...

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I would'nt live there because it's so desolate- (Devoid of inhabitants; deserted: 'streets which were usually so thronged now grown desolate') Untill an overall development plan is in place for the East Side that includes: RE-Developing the Commercial Districts- NEW INFILL BUIDLINGS FOR RETAIL, OFFICES, RESIDENTIAL, better street lighting, new sidewalks, streets, and infill the residential streets with proper URBAN FRIENDLY designs. How hard is it to get NON-PLASTIC housing built in this city? Seems to be very discouraging to see only the same looking styles be built while other cities have and are still creating a better mix of styles: BROWNSTONES, BRICK or STONE EXTERIORS, Built to the Sidewalk, Parking garages either put in the REAR or under the first floor to make room for FUTURE DEVELOPMENTS.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

The design could use improvements. But what should not be overlooked is the reason for the purchase of the house --barrier free entrance. The older neighborhoods in Buffalo still offer the opportunity for walkable, pedestrian-friendly neighborhoods. As baby boomers age, these factors will start to come in play. Hopefully, contractors will start seeing this as an opportunity, and take advantage of housing designs that not only accommodate aging baby boomers, but start acommodating the aesthetics of the neighborhood.

McHugh should be commended for taking the first step, hopefully, in the future, he might start taking advantage of more neighborhood appropriate designs, ie the Extreme Makeover design style that accommodated the historic neighborhood fabric, with up-to-date affordable, green energy features.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

The aging baby boomers I know who live here would prefer to leave. Stray Bullets took out a senior citizen standing in front of his Adamski residence a block away just last summer. At night the corner of William and Filmore is awash with hookers, gang bangers, and drug dealers. I can deal with these folks, it's their bullets I have a problem with. Thought needs to be put into East Side housing developments. You can't just plunk down a house and expect people to buy it. Long time residents fled this neighborhood for a myriad of reasons, until we sort them out this type of housing initiative will never succeed no matter how well intentioned.

replied to urban_bmm
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I guess it says something when the garage is literally 50% of the structure. Why not just put the house on top of the garage and save some space.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Because then you'll have nothing but a garage as the ground level face of the house on the street. Doors, windows and porches present a more welcoming feel than a large, windowless garage door. Large driveway pads also break up the streetscape, with a vehicle-oriented intrusion onto sidewalks that are intended for pedestrians. Single lane driveways are a necessary evil in an alleyless city like Buffalo, but with too many large driveways, the result will be a recreation of the "concrete lawn" phenomenon from the West Side.

replied to Sean Brodfuehrer
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

And if this neighborhood is cosidered poor, WHY have a garages fit for two cars? If I were 'low income' I would still be taking the bus as it's CHEAPER. Maby this is why so many in this are are poor? Putting too much money into a car they don't need.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Anything else? Because one can never get enough condescension around here.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Yeah, we get it: This place isn't your cup of tea. So don't buy it. But don't begrudge others who would and one who did.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Indeed. In the area I'm living in most of the people are considered at of below the poverty level. I see the neighbors in the supermarket paying for their food with food stamps, and every month or so they're telling me rhat they're getting assistance from heap. Their grocery cart is overflowing with junk food instead of healthy basics, there's 1 or 2 imported recent model cars in their driveway, & most are wearing more expensive clothes that I have.

I've been employed since 16. Don't get any state aid, heap (never did), and pay my own health insurance, but can't afford the cars they have.

I think some people are poor because they'll never be able to manage their money. But I think some people also take advantage of the system, benifits, & low cost housing just to drive cool cars. I drive an old efficient Ford, but it serve me well.

replied to Lego1981
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Spot on. I recently heard a pack-a-day smoker complain about having to pay for health insurance.

replied to Tom Jones
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

It is very admirable to live within your means, work hard, and generally play by the rules. It anything but admirable to brag about those traits while making unflattering generalizations about others over the internet. Bringing others down to bring yourself up is a diservice to all of those in your community who also bust their asses and play by the rules. That smacks of AM930 style high and mightyness.

replied to Tom Jones
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

pitbull>"It anything but admirable to brag about those traits while making unflattering generalizations about others..."

That would be a great little nagging lecture if Tom's comment had generalized, but his wording used "I think" and "some". Which words of his were really generalizing?

Speaking of generalizing...
pitbull>"That smacks of AM930 style high and mightyness".

replied to Armchair MBA
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Try reading the 1st paragraph.

"most of the people are considered at of below the poverty level", "Heap", "junk food instead of healthy basics", "imported recent model cars", "most are wearing more expensive clothes that I have".

Add the next paragraph where he claims to be above all of his neighbors flaws and you pretty much have Sandy Beach or Tom Bauerlie's show. That may be a generalization but that is pretty much all I here when I tune in to that station.

replied to whatever
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

pitbull(quoting Tom)>"most of the people are considered at of below the poverty level."

You conveniently left off his start of that.
Tom>"In the area I'm living in most of the people are considered at of below the poverty level."

His 'most of the people' claims fact instead of generalizing. Its accuracy depends on where he lives. Near the new house, the 2000 Census estimated a 45.9% poverty rate in the tract including Townsend St. If that area's poverty grew in 10 years, by now it might be over half (same as 'most').


pitbull>"Heap", "junk food instead of healthy basics", "imported recent model cars", "...more expensive clothes"

Nice twist to call that generalizing. He plainly refers to neighbors who he said told him they receive HEAP. I don't see where he referred to poor people in general. Even if it's only people he knows, him saying "some" sounds true.
Tom>"I think some people are poor because they'll never be able to manage their money. But I think some people also take advantage of the system, ..."

replied to Armchair MBA
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Whatever>"You conveniently left off his start of that."

Nice try.

The words I didn't include really make no difference in his message. He states the neighborhood is poor, looks down on them for taking public assistance, making bad choices at the grocery store, and living beyond their means. He then goes on to tell the world how much better he is for being above all of that. I don't see how leaving those words on changes any of that.

Keep looking but you wont see any "twist" on my part.

replied to whatever
Score: 0 ( 0 votes ) Vote up Vote down Report this comment

its all about the "Bank appraisal". Every house around here sells for 5K to ?. NO comparable sales makes this a hard sell to a lender. If I told you to buy a stock today for $25 a share and told you in 6 months it would be worth $15 a share would you but it? Until many of these are built here it will be VERY difficult to get a lender to hold a mortgage. I would guess the home owners insurance here is VERY high as well.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

St. Stanislaus has been involved in housing in the neighborhood. Down the street on John Paul Court the church build homes in the 1990's that sold from 80K all the way up to the mid $100's. All the homes have been sold. There is also infill housing on William St and Peckham Street in the area of the church. They also build a senior living facility, Msgr. Adamski Village at Fillmore and William St. Please get your facts staright. The homes by McHugh have no basements. That is a major minus for folks looking to buy newly constructed homes. Like an earlier poster stated, what happened to the financing promise from M&T??

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

I can guarantee you that the St Stans parish has absolutely zero money to subsidize any housing and can barely pay its' day to day expenses. The parish did its' part to renovate the campus and provide an anchor. That's all she wrote and there ain't no more, and that is a fact.

The city needs to tear down the hundreds of dilapidated structures in the area, including those directly across the street on Fillmore Avenue.

To expect Banks to take the risk of holding a mortgage in that area is wishful thinking.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

In as much as I understand the lofty goals and expectations of this project, I still don't get it. Where one chooses to live is extremely important. You have to live with your neighbors: send your kids to the local school, shop with them, and just generally share the same space. I wouldn't get a mortgage for a house that costs 5 times more than the surrounding stock. And, I think the model pictured couldn't be more dreadful.

Score: 0 ( 0 votes ) Vote up Vote down Report this comment

Buffalo Rising Poll