While many mayors face the more positive challenge of how best to shape the growth of their cities, others face a far harder challenge: how to manage decline. Shrinking cities are an issue that came to prominence following the reunification of West and East Germany—the rapid migration to the wealthier West led to the decline and near-collapse of many East German cities (more here). More recently, cities such as Detroit, Flint and Cleveland in US, and various others in northern England, are examples of where economic decline have led to crumbling urban cores.
The challenge is a vicious cycle to manage. By definition, these cities have fewer funds or local property tax revenue to deploy to the problem. And the further a neighbourhood crumbles, the less appealing it becomes to other prospective residents, which in turn accelerates the decline.
But several city leaders have been leading the way by revisiting a compelling idea from the 1980s aimed at trying to reverse the cycle of decline—the $1 (or £1) home. The idea is simple: give budding homeowners a chance to get onto the property market, especially in low-income areas. In exchange, create certain conditions for ownership, including the necessity to invest in the upgrading of the property—which in turn helps to revitalise the neighbourhood. The city wins by reversing the decline and reducing the blight of streets of boarded-up homes. The homeowner gets a foot on the property ladder, and can potentially benefit financially over time as property values hopefully tick upwards again.
All I need is a dollar
This year, several city administrations have opened up $1/£1 schemes, with varying models or rules attached – albeit all around a similar theme.
In Gary, Indiana, in the US, mayor Karen Freeman-Wilson launched the “Dollar home project”, aimed at local residents aged at least 18, not owning a home, and able to demonstrate the financial ability to rehabilitate a home (more specifics here; and a longer review here). The idea is to attract people who would make this their home—and naturally aspire to improve and develop these, rather than making this a specific requirement.
The goal is a powerfully personal one for the mayor, who describes how her first home was bought through a $1 scheme 25 years ago: “I still own that home and remember clearly how helpful the Dollar Home program was in helping me acquire my first home,” Freeman-Wilson. “We are excited to be able to reintroduce this program to Gary residents and look forward to it being another way that we beautify our neighborhoods.” (The scheme also helped win Ms Freeman-Wilson a listing on the top 100 city innovator list at UBM’s Future Cities).
In the UK, the city of Stoke-on-Trent has launched its “homes for £1 scheme” this summer. It explicitly aims to focus on bringing 124 “long term empty” homes back into use, revitalise these streets, and rebuild thriving neighbourhoods (see more information on the city’s site here). The scheme involves more specific intervention here—almost to the level of sounding too good to be true, as the Guardian flags up—as the city will not only hand over the property for £1, but will also invest an estimated £30,000 per property to refurbish them. Residents will get to choose the type of kitchen and bathroom they want. The quid pro quo? Residents must use this as their main home for at least 5 years, and pay back the cost of the work – with interest. If the home is sold within 10 years, the owner has to share the gains.
An alternative version of this scheme also originates in Stoke, called Empty Homes. It offers a 25% stake in an empty home for £1, while the 75% is owned by a housing association—the latter also invests in the refurbishment. The new resident pays £75 a week to the association, and has the chance to buy a greater share later on, while the housing association potentially shares in the value uplift (more here). It highlights the scope for a range of potential models to underpin such schemes, as cities seek to experiment.
For shrinking cities, the idea is a powerful one—and potentially transformative for both individuals and their cities. For anyone who doubts this, the heart-warming story of a Liverpudlian taxi driver and his family moving into their £1 home in the city. “When I first heard the news from the council it was like winning the lottery. I just can’t believe it,” as the excited Mr Madde put it. Let’s hope so.