According to the Minneapolis Star Tribune
, in the last three years, Minneapolis has spent $9.4 million acquiring 220 properties and St. Paul has spent $8.5 million acquiring 205 properties. Cities are buying up foreclosed properties to save the neighborhoods. Many of the homes had been purchased by out of town investors and landlords. They sold to buyers who qualified only for the most precarious mortgages. The buyers, banks and mortgages got into trouble the housed were abandoned.
An abandoned home can wreak havoc on a neighborhood. In the best case scenario, it lowers the values of neighboring homes. In the worst case scenario, the houses are taken over, used for illegal purposes and become a danger to the neighbors. SO the cities have stepped in .
Minneapolis is trying to avoid owning many properties, so it’s using the bulk of its NSP funding for nonprofit and community development groups to buy and rehab houses. The city will buy and knock down some buildings that aren’t worth saving and “banking” the land until it can be redeveloped.
By contrast, St. Paul is taking ownership of abandoned and foreclosed properties to have better control over who will redevelop them. In some areas, the city is trying to put several parcels together for larger projects.
Both cities are using some of the money for home-buyer assistance programs.
Submitted by exclusive buyer agent Mary Rugani.