Wednesday, October 28, 2009

Vacant Lots (and Lots)

Posted By on Wed, Oct 28, 2009 at 8:30 AM

Last week, the Shelby County Commission approved a proposal to build 125 homes on 140 lots in North Memphis neighborhoods.

The project came under fire for a number of reasons:

1. The developer, Harold Buehler, was using land from the Homestead program, which had essentially been seized from people who had not paid their county property taxes.

2. Buehler himself had almost $900,000 in back taxes owed to the county, and was also getting tax credits to do the $12 million project.

3. The neighborhoods where the new houses will be located have a lot of vacant properties and a lot of rental properties. And vacant, rental properties. Because of the tax credits the project uses, those new homes will have to be rental properties for the next 15 years.

4. Not all the neighbors knew about a) the proposal before it came to County Commission, or b) the Homestead program, which allows people to obtain county-owned lots for a small application free and a deposit. If they build affordable housing on the lot within 12 months of obtaining it, they get their deposit back.

I guess the question is best summed up by Community Development Council of Greater Memphis head Emily Trenholm:

"We acknowledge that the county is facing a lot of challenges in regards with vacant lots and trying to put them into productive reuse," she says. "What's the appropriate mix of rentals to home ownership? ... It's not necessarily a given that more low-income residential housing is better than nothing."

If a lot is vacant but maintained can it be used more productively in the future as part of a more comprehensive redevelopment plan?

The Buehler proposal was approved, but the underlying issue of vacant lots remains. For the next few days I'm going to be writing about this issue. I also wrote about it in my column this week, so pick up a copy of today's new print version.

And heaven forbid I suggest we use Detroit as an instructional tool and cautionary tale, but they recently held a four-day, almost 9,000-lot auction. A fifth of the property at auction was sold, but even though the bidding started at $500 for each of the lots, most of it didn't.

Some potential homeowners and Detroit residents thought they were penalized by the auction process. The individuals who would ostensibly live in these homes were often outbid by banks and investors from other areas of the country. The auction also took four days, time they said working people could not spare from their jobs.

"Bill Frank, a Detroit realtor trying to buy a small house for a just-married friend, found himself repeatedly outbid.

'Speculators are often not good for a city and, from my experience, they are going to lose a fortune,' he said. 'But there are no easy answers. It's a declining city.'"

To read more, go here.



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