Want to build a new house in Minneapolis? Choose a vacant lot on the North Side, and the city will help make it happen.
The City Council approved a pilot program Friday that will offer incentives for building new homes in north Minneapolis and help low-income buyers purchase houses built on vacant lots. The program aims to produce needed affordable housing and start filling the nearly 400 city-owned vacant residential lots.
"The idea is really to develop on every single one of them," said Council Member Blong Yang, who represents the North Side's Fifth Ward and started working on the program about a year ago.
There are different ways to participate in the program, with various incentives.
Developers building new housing on city-owned vacant lots in north Minneapolis can receive up to $75,000 in incentives per unit. The housing they build must be affordable for people with annual incomes at 80 percent or less of the area median income. For the North Side in 2016, the most affordable homes sold for less than $160,000, on average, according to the city.
Individuals building a new house on the North Side can receive up to $20,000 to subsidize construction — or $25,000, if they're Minneapolis police officers, firefighters or public school teachers. There are no income restrictions, but they must live in the house for at least five years.
There's also help specifically for low-income home buyers interested in housing on infill lots in different parts of the city. Households with an income at 80 percent or less of the area median income can qualify for up to $25,000 to bridge the gap between a home's sale price and what they can afford — and lots can be in north, south or northeast Minneapolis.
"We want to make homeownership in south and northeast affordable as well," Yang said. "The idea is to keep certain lots, or certain houses, affordable for people."
The city will pay for the program using money allocated in the 2017 budget for existing housing development programs. If the pilot year goes well, city staff will develop a plan to extend the program another five years.
Many of the lots that the city owns were purchased in the wake of the 2008 housing crisis and 2011 tornado that tore through the North Side. It costs the city $3,600 a year to maintain each lot, Yang said, and there are still frequent complaints about overgrown weeds, litter and other blight.
The hope is that the infill housing program will increase the city's population and tax base and make more affordable housing available to those who need it.
"I don't know if it'll work," Yang said. "We haven't tried it, and so we need to try it."