Blight Fight: Minneapolis, St. Paul receive housing bucks, but who benefits?


6 thoughts on “Blight Fight: Minneapolis, St. Paul receive housing bucks, but who benefits?

  1. In addition to the issues raised here, there is another question about which properties will be acquired based on what bank/entity ended up with the mortgage that went bad. The National Community Stabilization Trust is likely to dominate this spending, and could undermine neighborhood planning (especially in Saint Paul under the Invest Saint Paul program). Best to check which properties these money will even consider buying, let alone which ones stay standing.

  2. I am disappointed by the lack of thoughtful analysis in the “Blight Fight” article. The questions raised about investments are supported by two people who clearly have an interest but hardly are well informed of the overall issue of foreclosed properties. The suggestion that GMHC and Daytons Bluff will profit from the acquisition, rehab and resale of foreclosed properties is unfounded and just plain wrong. Although houses may sell up to 95% of market value, a house purchased for $15,000 is unlikely to be salvagable and the redevelopment costs would likely exceed the limits on the market value – and thus require a subsidy.

    The foreclosure problem far exceeds the resources available. This will force some difficult decisions, but faulting those organizations who are working hard to meet this challenge is unfair and unjustified.

    The writer does a disservice to her readers by not delving deeper into the economic challenges of responding to home foreclosures. I trust that future reporting on this issue will be more thoughtfully researched and supported.

  3. I am an old house lover and owner in North Minneapolis. The reality of owning a home is that it needs to be maintained and you need to be financially savy enough to put money away for the inevitable replacement of the heating system or roof etc. In the past there has been a push to make everyone into a homeowner. Even with homeowner training classes there is no guarantee that the homeowner will get this! The mantra of the time was creating pride through ownership. That was a falacy. If you don’t have pride to begin with, owning a home that you are incapable of maintaining will lead to further deterioration of pride. Perhaps there is room for decent rental as well as association type ownership. As long as we have a population with different needs, we should be looking at housing tailored to those needs. The issue with regard to tearing down current housing stock to my understanding it will be those houses not marketable to anyone but the worst of the slum landlords. Believe me I have been in those houses along with my housing preservationist friends and we are in agreement. Those are the houses that will always be the thorn in the neighborhood’s side, the proverbial rotten apple in the barrel. The way I see it, the wisest way to use this money is to encourage purchase / rehab by a person who will owner occupy and to not set an income limit on that. I know of people who are doing this and they are coming out way ahead with after rehab mortgages of under 100K. ( It costs more to have them rehabbed before marketing them and it becomes less affordable to the buyer. ) The buyer then gets to tailor the house to their taste with some guidance of course. The reason that there should not be an income limit is that the concentration of poverty in the hardest hit areas made them more vulnerable in the first place. A healthy neighborhood really replicates a small town with varying socioeconomic strata. The more affluent demand and are willing to pay for more quality ammenities. There tends to be thriving businesses and thus better paying jobs, better schools and recreational options. I’m hopeful regarding NSP!

  4. The house next door to me was abandoned about a month ago. I suspect their ARM adjusted and they couldn’t keep up. This was a wonderful turn of the century home that had been completly renovated in the 1990s. They were a wonderful young family and excellent neighbors. After sitting empty for 5 weeks, vandals broke in over the Thanksgiving weekend doing tens of thousands of dollars of damage. I had already figured that the bank would lose 40 to 50 thousand dollars on a resale, now they will lose more. The best solution would have been to work out a solutions so the young family could stay!

  5. The the list of homes slated for demolition (along with those recently demolished) are a mixed bag. I fully agree that SOME are beyond hope… but not all.

    Nor are they all too expensive to rehab.

    Perhaps some are too expensive for a corporation with high labor and holding costs, but last time I checked there were other ways to fix up a house, including my personal favorite which is by a private owner supplying at least some of their own skill and sweat.

    Not every home on the demolition list is a decrepit, burned-out shell.

    A case in point is 2123 N. 6th St. This solid brick foursquare was last marketed at $12,900. Now it is gone.

    You can see a picture here:

  6. Great article Molly!

    It is unfathomable to me why the city would not invest that $1,700,000.00 into incentives to restore these homes and just give these homes to owner/occupants who want to invest and live in the community.

    I agree with “Anonymous”, With many foreclosures already have been picked up by slum lords who maintain these properties to minimum standards and rent them to the poorest class of individuals (through government entitlement programs). It is crucial that these neighborhoods begin to diversify.

    The lose of tax revenue alone from these foreclosures will surely affect the cities budget for many years to come. Add to this the falling property values from existing homes impacted by the lack of infill in these communities where this senseless destruction is taking place. This translates into less dollars for policing, public works, and community education programs.

    At what point does the city foresee the thousands of vacant lots being created in the community rebuilt into contributing households. It is a recipe for disaster.

    Kris, I understand your sentiment and you are correct in being concerned about how programs meant to help are being questioned; however, I think that some very valid questions are being asked here. It is correct that many of the $15,000 homes may not be economically salvageable. However, most of the proposed homes to be built on these vacant lots will never be able to sustain a fair market price either. (If they ever get built at all).

    Steve, you are right that the criteria for demo is very screwed up. We see some very marketable homes with great potential being bulldozed. But as a new Minneapolis resident, I wonder what kind of planning got us into this mess.

    Patrick, what you have overlooked is that your tax dollars are already paying for the write off of these homes through the $700 Billion Congressional Bailout. Why take a loss on these properties to get them into caring homeowners hands which will improve the community when you can stiff the American public for the full cost of your loss. As Steve points out, the criteria for saving a home has less to do with the home itself than with financial arrangements behind the scenes.

    Another problem with these vacancies is that there is no affective program to limit the looting that turns an overpriced home into a public eyesore. most of the damage to these homes take place after the creditors take possession.

    The laws governing the enforcement and conviction of looters is so lax that I dare not address it publicly. We need legislation and enforcement that makes the title holders of these properties responsible for the condition and the safety of their investments. Home ownership is about more than a financial arraignment regardless who you are. It is unfair to the neighbors who have worked so hard to build communities, to let banks and financial institutions off the hook for structures that aren’t maintained.

    In regards to the salvage of demo homes- The city of Minneapolis has issued an RFP for any salvage and has not contracted with any salvage company. The demo contractors are given the opportunity to contract out salvage. This means that the salvage of building materials is only as expedient as it can be as to not interfere with the pace of demolition by the contractor. So we are filling our landfills with items that could be utilized in salvaging neighboring structures and old growth lumber.

    Here is where I do a selfless plug-

    Several weeks ago a small group of historic homeowners formed the Minneapolis Historic Homeowner Association (MHHA). Our intent was to promote vintage properties around the city (it still is). As we began to discuss concerns in our communities we felt we had to act on the very problems we are discussing here.

    We have established dialog with the City Planning and Zoning Department, contacted Non-profit Green Recycling Centers, Attended Demo appeals, and are working hard to pull together community groups in an effort to learn more about the problems and formulate solutions we can live with.

    We need your help. Check out our web site at and contact me for more information.

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