Neighborhood Stabilization Program (NSP) Overview

Important Notice: This Program has Ended


The Neighborhood Stabilization Program (NSP) addressed the impact of abandoned and foreclosed homes in our neighborhoods and communities. Types of projects included:

  • Homeownership assistance
  • Acquisition and rehabilitation of foreclosed and abandoned houses
  • Demolition and elimination of blighted properties
  • Acquisition and redevelopment of abandoned properties

Strategic Goal

Enabled local governments to have adequate infrastructure to accommodate allocated growth and enable economic development while maintaining quality of life.


The Department of Commerce administered NSP programs around the state. Commerce provided grants to 25 local governments to set up NSP programs that met the needs of their individual communities. The majority of these jurisdictions awarded their NSP funds to local nonprofit agencies with expertise in neighborhood stabilization, community development and housing.

Results and Achievements

In March 2009, Commerce signed a $28 million Neighborhood Stabilization Program grant with the U.S. Department of Housing and Urban Development (HUD) and entered into sub-recipient agreements with 25 local governments experiencing high degrees of foreclosures and abandoned properties. In March 2011, Commerce signed an additional $5 million grant with HUD for Neighborhood Stabilization Program3 funds, which resulted in four more local government projects. A majority of local governments partnered with agencies, such as Habitat for Humanity, local housing authorities, or social service agencies.

These federal NSP funds were used to purchase and rehabilitate homes or properties that were sold or rented to low, moderate or middle income families. At least 25 percent of the funds helped low-income (less than 50 percent of Local Area Median Income) households. All funds were spent by March 2014.

Of the $33 million in NSP grant funds, over $32.9 million and another $5 million in program income funds have been spent to mitigate the impact of abandoned and foreclosed homes in Washington communities. Over 450 properties were acquired, rehabilitated and sold or rented to eligible people.

With the housing crisis that started in 2008 subsiding, and all funding distributed, we are now in the process of closing out the Neighborhood Stabilization Program in Washington State.

HUD Reports

Fast Facts

  • NSP funding to Washington State was provided through the Federal Housing and Economic Recovery Act and the Dodd-Frank Act.
  • More than 40 percent of NSP1 and 60 percent of NSP3 funds benefitted low-income persons (less than 50 percent of area median income).
  • Approximately 450 housing units were recovered and put back into productive use.
  • NSP homes need to remain affordable on average for 30 years.

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