Once and Again: In Rochester's Kutzky Park, neighborhood developers turned back time by modeling an affordable multi-family unit after a turn-of-the-century Sears-Roebuck design.

They’re out there, staring us right in the face. Sturdy foundations but outdated utilities. Great locations but bad weatherization. Low prices but a ton of hard work. Older homes in core neighborhoods are part of the answer to affordable housing, but unlocking their potential requires seeing beyond what is to what could be.

 

Liz and Chad Robbins had always enjoyed downtown living. So when Chad began his Mayo Clinic residency in 2008 and the couple moved from Birmingham, Ala. to Rochester, Minn. they bought a home in the Kutzky Park neighborhood.

About 10-15 years ago, this downtown neighborhood was already acquiring a bad reputation for run-down homes and increasing crime. But two movements—one organized by concerned residents to take back their neighborhood, and another by the nonprofit First Homes of Rochester to renovate and re-sell some of the neighborhood’s older homes—have begun to turn things around.

“We’ve lived here a little over a year and we haven’t had any problems with the neighborhood,” Liz Robbins said. “We got this lovely, restored old home that we thought we’d never be able to afford. My husband walks to work nine blocks every day, and all the things we need to do are within a couple blocks. It’s great.”

Meanwhile near Brainerd, when one of Karen Mason’s neighbors fixed up her home, it prompted the Pine River resident to take the plunge, too. Mason had grown up in the 100-year-old home and moved back five years ago.

“This was the oldest-looking house in the neighborhood,” Mason said of her house in the small town. “I’d always wanted to fix it up, but there was no way on my income."

So far, Mason has combined about $4,000 of her own money with a forgivable loan to replace the roof, windows and doors, and to put up new siding in the spring.

Stories like these show that it’s possible to fix up older homes and build stronger core neighborhoods in cities and small towns throughout Minnesota when motivated residents, resources and public policy mix together just right.

In central Minnesota, the Initiative Foundation has been working to strengthen core neighborhoods by engaging residents in St. Cloud and other communities. Among neighborhood leaders’ chief concerns are foreclosed homes that are falling into disrepair or being converted into rental properties.

“With foreclosures, we have an affordable housing challenge that, ironically, could also be an affordable housing solution,” said Kathy Gaalswyk, Initiative Foundation president.

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"We're helping communities to reinvest in their core neighborhoods to revitalize their downtowns and provide opportunities for families."
- Kathy Gaalswyk, Initiative Foundation

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	Retro Revitalization: Metro Plains Development and First Homes of Rochester are building the new Cascade Creek Apartments on the site of blighted homes in Kutzky Park.

Until the mortgage crisis and economic recession hit, the majority of affordable housing built each year was new construction homes located in subdivisions at or near the edge of town, said Warren Hanson, president and CEO of the Greater Minnesota Housing Fund (GMHF). According to Hanson, the halt of new construction is beginning to benefit core city neighborhoods.

“Just as Main Street declined because of the ‘Big Box’ commercial strip developments built on the edge of towns, core neighborhoods declined because of new subdivision developments,” Hanson said. “This process has started to reverse itself.We are now seeing exciting revitalization projects happening in communities across the state.”

In fact, fixing up older homes is one of the greenest, most conservation- minded building techniques, said John Harrington, a program and loan officer and green building specialist for the Fund. “Older homes are already located in the center of town life. Fixing up these homes extends their useful life, re-uses materials, and reduces the need to convert farmland and other usable land for new housing.” Plus, older homes often have wonderful architectural details that can’t be cost-effectively re-created in new homes.

In Rochester the nonprofit organization, First Homes, created by the Rochester Area Foundation, set a goal of buying, rehabilitating or removing more than 50 core-neighborhood foreclosed homes in 18 months. The organization received $3.3 million in federal and state grants through the Minnesota Housing Finance Agency, Greater Minnesota Housing Fund and other groups, according to Sean Allen,First Homes’ Executive Director.

The group has been working for years to improve the Kutzky Park neighborhood, which had long-running problems with rundown properties, he said.

“We picked the worst houses in the neighborhood and tried to make them the best,” Allen said.

First Homes purchased and renovated more than 25 homes in the neighborhood, using a land trust model that retains ownership of the land after the house is sold to a buyer. That reduces the purchase price of the home. Resale restrictions make sure the homes stay owner-occupied and affordable in the future.

Pine River has already used a Minnesota Small Cities grant to help rehabilitate eight commercial and eight residential properties, including Mason’s home.

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“You have to have good housing if you want a good workforce.”
- Gail Leverson, Cass County Economic Development Corporation

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In other parts of the central region, the Central Minnesota Housing Partnership has used federal Neighborhood Stabilization Program funds to target five high-foreclosure communities in Wright, Sherburne and Isanti Counties and help with down-payment assistance as well as home repairs. The agency administered up to $12,000 per household through the one-time allocation, said Bill Reinke, executive director.

However, preservation of existing homes isn’t always an option, especially when a house is too run-down.

“We’ve got about 100 substandard houses here in Kutzky, and they can’t all be saved,” said Dave Edmonson, a longtime Rochester resident and member of the neighborhood association.

In some places, First Homes has torn down old housing that couldn’t be restored and put up affordable condominiums and single-family homes that fit the neighborhood’s historic character, Allen said.

Unfortunately, there will never be enough public dollars available for everybody who wants to fix up their homes, even with the recent increase in one-time federal housing dollars, said Hanson. Instead, he advises communities to think strategically about priorities, and to use housing grants and loans as a way to plant the seeds of revitalization in a core neighborhood.

“Leaders have to be very thoughtful about what they do and where they do it, so it has the maximum impact,” he said. “ You’re not going to change a neighborhood overnight, but restore the worst house on the block and maybe you’ll get more people taking their own initiative— house by house, block by block.” IQ