North Minneapolis Housing Market Index.
This report introduces the Folwell Center for Urban Initiatives (FCUI) Housing Market Index (HMI), a new tool that measures the strength of an area’s housing market. The HMI will help local leaders better plan and target sustainable housing interventions as part of their broader reinvestment effort. The HMI borrows from an index created by the Local Initiatives Support Corporation. The most significant difference is the FCUI HMI’s geographic specificity—neighborhoods are measured by block, not census tract or zip code. The FCUI HMI offers a block-by-block view that provides a more precise understanding of neighborhoods. When applied to a neighborhood, it clearly shows investment and disinvestment, as rates of owner-occupancy, housing condition, vacancy, and value retention are combined and compared.
In north Minneapolis, the area examined in this report, the block-by-block view finds a much more diverse housing market, with the blocks in some neighborhoods falling almost entirely on one side of the housing strength spectrum and the blocks in other neighborhoods running the entire gamut of housing strength. Understanding this diversity should lead to improved intervention strategies and a better targeting of limited resources for long-term and, in some cases, scalable improvements.
The report argues that local leaders, city agencies, and neighborhoods should use the HMI when planning, especially in neighborhoods like those in north Minneapolis that have experienced disinvestment and destabilization. New public and private investment should also be sensitive to FCUI HMI data: property owners (banks or local governments), when considering whether to sell or hold REO property; new commercial investors, when considering where to locate needed amenities; and homebuyers, when considering where to purchase a home. To further improve the housing environment in areas with distressed housing markets, the report recommends that the City adopt new policies and ordinances that incentivize responsible rental ownership. Doing so would result in improved HMI scores and, likely, improve results of efforts to increase homeownership. Finally, allowing flexible zoning in large areas with significant housing deterioration should also encourage redevelopment investment.
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