Homeownership is key to revitalization of Duluth's neighborhoods

Where did the owners of 1,400 homes go? That's the question raised by the release of Duluth's 2006 housing indicators study. According to the study, Duluth has lost 5 percent of its homeownership base, or 1,400 units, since 2000. Only 60 percent,...

Where did the owners of 1,400 homes go? That's the question raised by the release of Duluth's 2006 housing indicators study.

According to the study, Duluth has lost 5 percent of its homeownership base, or 1,400 units, since 2000. Only 60 percent, or less than two-thirds, of the city is now made up of homeowners. Some of this loss has gone to surrounding communities, an observation reinforced by the state demographer, who has noted the suburbanization of the area.

Duluth's homeownership base is leaving, and sufficient opportunities for new homeowners, particularly among working and middle-class households, are not being created. This is true despite substantial efforts by the At Home in Duluth community partners, including the Local Initiatives Support Corporation, Neighborhood Housing Services, Northern Communities Land Trust, Women's Community Development Organization and others.

The subprime lending scare of late rightfully focuses on those who have been swindled into buying homes they could not pay for, but that by no means suggests that all mortgage-assistance programs should be abandoned. Indeed, many match honest lenders with industrious, dedicated new homeowners, allowing many whose only option had been renting to participate in the American Dream.

Why is homeownership important? When it declines, neighborhoods become more unstable and transitory. Crime increases, and policing and other costs of government rise. Neighborhoods become more blighted, the tax base declines and commercial areas share in the fall. Any of this sound familiar?


Wholesale conversions of single-family homes to rental units has resulted in the virtual elimination of "family" from single-family zoning in some areas. There are entire blocks in Duluth formerly populated by homeowners that have been converted to mostly student housing. From 1990 to 2000, more than 150 single-family homeownership units were converted to rental units in Central Hillside alone, and there were more than 500 conversions across the city.

Substantial parcels of vacant, land in Duluth are burdened with delinquent fees and taxes that will never be paid. There is no efficient system for getting those parcels back into productive use, even for parcels currently owned by the city or county. There is no cross-referencing of city and county fees and assessments. Neighborhood Housing Services recently purchased a vacant, boarded property for demolition from St. Louis County to convert into an affordable homeownership project. It took eight months and we had to conduct extensive research on the property and pay city assessments as well.

Both non-profit and for-profit developers have expressed a perception of Duluth being a difficult regulatory environment compared to surrounding communities. This discourages housing development in the city. In 2006, Duluth experienced one of its most violent summers on record, coming while the city was losing police officers and shutting down community-based crime fighting efforts. The good news is the "crime wave" by Duluth standards was low for any urban area, and the city's new police chief, Gordon Ramsay, seems to be addressing it.

Yet there are other potential disruptions. For the third time in five years, Duluth is discussing closing grade schools. Many recent arrivals to the area have settled in Hermantown because they say its public school system is more stable than Duluth. What young family wants to buy a house in a neighborhood not knowing if the local school is going to be there? The good news is that it appears this time the process will provide a long-term solution.

The growing number of households of color represent a real opportunity for increased homeownership, but right now these populations have homeownership rates averaging around 25 percent, less than half that of the city as a whole.

Fortunately, Duluth has opportunities to reverse these negative trends. Officials are proposing a reorientation of federal funding available in Duluth to support neighborhood-generated plans designed to create healthier neighborhoods, and support homeownership. There are families in the market for homes in Duluth and an inventory of affordable existing homes. Duluth can commit now to elevate homeownership to the top of the community development priority list.

Duluth can commit existing local and national housing and community-development resources to assist and offer incentives to potential homeowners to buy and fix up the current inventory for sale in Duluth. By doing this, the city can stabilize its housing situation in the short-term while it puts in place long-term solutions. At NHS, we see dozens of potential homebuyers a year who, for lack of financial assistance and support, could be successful homeowners. And we see a declining housing inventory that due to penny-wise and pound-foolish policies and neglect result in the loss of homeownership assets. This can be fixed now, this year.

Duluth needs to do for homeownership what it did for homelessness. It needs a plan. At a minimum, the goal should be to get Duluth's homeownership rate up to the national average of 68 percent, and ideally, the state's rate of 73 percent.


The plan should solve the issues identified above, but follow-through over the next four years is needed. Everybody running for office for the next four years needs to be committed to solving this problem. The health of Duluth's neighborhoods depends on it.

George Garnett is executive director of Neighborhood Housing Services of Duluth.

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