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Housing Acquisition and Rehabilitation Program

Round Lake Beach, Lake County

Housing Program

The Village of Round Lake Beach developed the Housing Acquisition and Rehabilitation Program (HARP) to acquire, rehabilitate and sell vacant properties at affordable prices.

An MPC Housing Program case study

Program background

Responding to concerns from residents about the growing number of blighted vacant properties and limited amount of affordable housing options, the Village of Round Lake Beach developed the Housing Acquisition and Rehabilitation Program (HARP) to acquire, rehabilitate and sell vacant properties at affordable prices. The village worked out program details through a series of meetings with representatives of the Northwest Suburban Board of Realtors. The Village implemented HARP as part of a five-pronged plan created in 2002 to address residents’ concerns.

How it works

The Round Lake Beach Village Board is involved in every step of the HARP program. The board first has to pass a resolution to purchase each home and later to authorize the expenditure of funds for renovation. The board must also authorize the sale of the home. The board reviews expenditures, closing costs, loan interest rates, sale price and net profit, all of the village administrator assembles. There are six important components to Round Lake Beach’s HARP program:

  • Database: The village created a database of vacant properties, flagging those that fit the category of substandard foreclosures in which the private market had shown no interest. Village building inspectors continually update the database to reflect new foreclosures and new village acquisitions. All of the homes acquired must be vacant, and the village prioritizes acquisition opportunities. Those for which acquisition, demolition or rehabilitation will bring the most benefit to the village or a given neighborhood, such as fixing a severe blight on a block, go to the top of the list.
  • Industry professionals: A banker, real estate agent and general contractor work with village staff to help maintain the database and handle sales.
  • Market analysis: The village works with a general contractor to develop a market analysis of potential acquisitions. This includes the physical condition, minimum market value after renovation, amount of six months’ interest (the typical timeframe from purchase to sale) and closing costs. Since the economic downturn, Round Lake Beach has focused much of its efforts on acquisition and demolition of vacant and troubled properties. The Village primarily acquires very low cost homes in the $10,000-$25,000 range, demolishes them and holds on to the properties for future redevelopment.
  • Additional resources: If the cost of a house, including the purchase and rehabilitation, is going to exceed the minimum assessed resale value, the village can apply for a grant of $15,000 per house ($105,000 total available annually from Lake County). The HARP program has applied Community Development Block Grant (CDBG) and HOME funds toward the program, as well as resources from the Lake County Affordable Housing Commission. The village may also draw money from its revolving loan fund (RLF). Some houses, even with the affordable price requirement, sell for more than the purchase price and renovation costs. Money above the loan amount feeds the RLF, which is used only for HARP program rehabilitation efforts.
  • Pacing: The Village makes a determination on the number of homes for acquisition, demolition or rehabilitation every year based on the market. A line of credit from First State Bank dictates the number of HARP projects the village administers at any one time.
  • Affordability: Homes in the program are deed-restricted and must remain affordable for five years under CDBG guidelines. Information and counseling on the availability of low-cost loans and grants for eligible homeowners are provided to home buyers through this program.

The definition of affordability is based upon grant specifications from either the U.S. Dept. of Housing and Urban Development (80 percent of Area Median Income (AMI), $57,900 for a family of four in 2014) or the Lake County Affordable Housing Trust Fund (100 percent of AMI, approximately $72,400 for a family of four in 2014) depending on the grant type used.

In 2005, Round Lake Beach established a partnership with the Affordable Housing Corporation of Lake County at the urging of Lake County officials. As a nonprofit organization, the Affordable Housing Corporation lends additional resources and capacity to the HARP program. As a part of the recent national foreclosure settlement, the Affordable Housing Corporation has an opportunity to continue their work with Round Lake Beach through a grant from the Illinois Attorney General’s office.


Department of Economic Development, Village of Round Lake Beach

  • Goal

    Revitalize vacant, blighted property and provide quality affordable homes

  • Target

    Blighted vacant property

  • Financing

    The Village received a $500,000 line of credit from State Bank of the Lakes. Lake County also provides grants to cover the difference between acquisition and rehabilitation costs and the resale value. The Village contributes funds to the program annually.

  • Success

    Since 2010, seven homes have been acquired and demolished and two others are currently in the pipeline.

  • Lessons learned

    • Community efforts to keep track of and rehab troubled properties can improve not just those homes but the properties on the streets around them.
    • Partner with groups such as the county or local nonprofits to bring in additional resources.