Here’s my long winded addition to my previous posts.
$500,000 is a great deal of money to help restore local homes. It’s awesome that Price Hill was chosen out of all the possible places within the state. It’s also a significant achievement for local organizations and politicians to gain interest outside of the local area. Not only will houses be rehabbed with local supervision, the houses will be sold to owner occupants. (Or at least, I’m assuming this as it is implied in the stipulations of the grant.) The latter point is without a doubt the most significant. These homes will not be available to out of town landlords that milk rental properties without properly maintaining their investments.
With these points out of the way, I’d like to mention why the project isn’t all that it could be if it had come from a private investment group. Since the funds are provided by The Ohio Housing Finance Agency they have stated that the purchasers of the rehabbed homes must earn no more than 80% of the median income of the area. Regardless of the limit’s actual value, it’s a limit–and it’s 80%. This has several detrimental effects. It’s absurd that restrictions can be placed to limit purchasers to those that have lower incomes but if the situation were reversed–limiting purchasers to those that have higher incomes–that would be illegal. Anyway, that’s an entirely different issue.
Here are the points to keep in mind:
- This limits the amount of money that can be invested in some of the chosen homes. Rather than fixing up homes to restore them to their full potential, it might be necessary to cut some renovations short just to keep the final value of the home low enough for the target buyers.
- This sends a message that Price Hill is a place that houses people that make 80% of the median income deterring people of higher incomes that might be considering moving into Price Hill’s Incline District and Wittier Gardens areas. I’m not griping on status and class. It’s simply a matter of fact that people of higher incomes would in turn have more financially to give back to the neighborhood. Consider the development/conversion of Queens Towers Apartments to condominiums. The new owners can sell very expensive condos to working professionals that will live and possibly work or buy offices across the street. This creates an entirely new market for the area and, best of all, one that is pure free-market economics. There’s no government bureaucracy involved. Likewise, there will certainly be rippling effects of this throughout the neighborhood. These effects will be missing from this grant.
- This isn’t really giving locals control over properties. It’s giving a state agency control over the properties. Sure, we get a prettier property to look at, but at the same time the degree of improvement is limited to what the OHFA specified. The government interferes in Price Hill by issuing Section 8 and moving sex offenders into the area. While this isn’t as extreme, it’s still giving non residents a say in who can live here.
So, in summary, $500K provides great improvements to the neighborhood properties and hopefully the lucky new home owners will be model citizens. However, Price Hill should hold out for investments with no strings attached.
A small note: I also question that the OHFA might be self serving in this project. I’m not positive, but it appears that the purchases could be financed through the OHFA (and the stipulations were included to qualify for their terms).
Comments are welcome.
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What are your thoughts on the Cedar Grove project, where the City subsidy is $75,000 per unit?
It seems like a similar situation. Keeping properties out of the hands of out of town landlords is a plus. But, projects that are funded largely by our tax dollars are somewhat a slap in the face to current and long time property owners in the area. After taking our tax money they feed it back into the neighborhood by rehabbing homes with the goal being to keep property values “affordable” (read “low”). There are no home owners that want their property values to decrease or stay even. At the least you expect an increase to match inflation. Then in the midst of these programs the county auditor attempts to raise property taxes in the same area.
The problem is that any government organization that funds the project has little (really nothing) to lose in the deal. It’s (generally) not their money, not their property and not their neighborhood. I’m not an urban planner or contractor etc, but if these projects were sponsored in a way that each had to generate a return, that would be ideal. A lot of people probably think I’m crazy. But, really it’s the only option that makes sense.
It seems to be a Catch 22. Yes private investment is ultimately the only hope, but until you have a stable environment it is very, very difficult to attract the investment. With that being said Academy Avenue has been having some very good property sales. Homes have sold above $150,000, which is quite good compared to average home sale values in Price Hill. These were not uncorked by PH Will’s efforts. It actually is heppening because young professionals are starting to understand, and see, real value in the large homes with great potential on Academy. Now we need about 100 more streets in Price Hill to catch on like that. And we have a 100 more streets like Academy. PH Will’s efforts are meant to be a stabilizing influence, private investment builds long term stability. We need less affordable housing in PH. The only way to get there is for values to appreciate, and that comes when free market forces are in play. Let’s hope Academy keeps booming and more streets, and buyers catch on.
Witte, I agree 100%. It’s an undertaking that just has too keep moving forward.