Bring Back the Dollar Days

One of the ugly consequences of America’s foreclosure crisis is the abandoned homes that are scarring our cities.  Once proud cities like Cleveland and Detroit, which in the past symbolized America’s industrial might, are turning into ghost towns, their neighborhoods barren and houses boarded up.  Cleveland and Detroit reached their peak in the 1950s, when their populations were over 900,000 and 1.8 million, respectively—now they have half the people.  There no quick fixes, but perhaps these cities can learn from a project my former adopted hometown, Baltimore, undertook thirty years ago:  the dollar homes.

Otterbein is an old neighborhood adjacent to Baltimore’s Inner Harbor.  A thriving district in the nineteenth century, Otterbein eventually fell into decline, and in the early 1970s, Baltimore’s government seized the properties, and emptied them in anticipation of the new Interstate 95.  The new highway would have demolished other neighborhoods including Fell’s Point and Federal Hill.  One Fell’s Point resident, Barbara Mikulski, rallied the locals to save their neighborhoods, and they succeeded:  the highway was rerouted to follow a path farther to the south.  By the way, the pint-sized, pugnacious Mikulski is now in her fourth term as the senior US Senator from Maryland.

The city of Baltimore, however, was still stuck with all of these abandoned houses.  Rather than tear down these historic brick row houses, the city decided to auction them off to urban homesteaders willing to upgrade them.  The city sold them for $1 . . . with the caveat that the owners could prove they had the cash to make the necessary overhauls.  When local banks balked at providing loans for such a risky venture, the city sold bonds, the proceeds of which were loaned directly to these new homeowners.  The program was expanded to other neighborhoods in the city . . . and I happened to live in one during the early nineties.

Baltimore is not without its problems:  its population has declined, its city leadership is in turmoil (did its fabulous mayor get a free fur coat from a crony or not?!?), crime is far too high, and some neighborhoods, such as SoWeBo (SW Baltimore) just never took off despite promises of revitalization.  But Fell’s Point, Federal Hill (home of one of east coast’s best public markets, Cross Street Market), and Otterbein now thrive, and the nearby Inner Harbor has become a huge tourist and conventioneer hub.

So why can’t other cities take on a similar project?  The city could take title to these bank-owned properties, taking them off the banks' books.  These homes in turn could be sold to young families and creative types who have may be short on budget for a new house, but have the time and wherewithal to refurbish an older building.  And since many of these homes are clustered, we have an opportunity to revitalize entire neighborhoods at once  . . . creating an organic “stimulus” and building true “communities.”  The nature of the workforce is changing; many of us now freelance and have flexibility as to where we live—and the opportunity to own a home next to nothing should be a carrot for those who want to own a home but currently can’t get that $150,000 loan from the bank.  The devil is in the details, but here’s a way to provide affordable housing, renew our cities, provide green building incentives, and kick start some consumer spending.

If you are one of those urban homesteaders who took the risk to move into a once “sketchy” neighborhood, please share your story.