I could have told you that

Common sense. That’s all it would have taken to figure out building new townhouses in this part of town and expecting to sell them was a bad idea;

Five new row homes at 10th Street and Menlo Avenue were going to be sold to low-income residents, but federal rules and the lending climate have taken that option off the table for now, said Jim Schmidt, executive director of the Sioux Empire Housing Partnership. The organization, which sponsors affordable housing projects, now plans to rent the homes – a first for the group.

Signs release

Letting me clue you in, good luck renting them to;

By renting the properties, the organization hopes to generate revenue that will be used to pay off loans on the properties. Each home took about $126,000 to build. They vary in size from 1,000 to 1,200 square feet, and Schmidt said they will rent for about $750 a month.

This paragraph explains it all. First off, you would have to be incredibly fricking stupid to buy a 1,200 square foot row house for $126,000, Even if it was in a nice part of town. Add the fact that it is on loop, and you have just produced a double whammy. And $750 a month rent?! LMAO. The average rent for an apartment in that hood is about $450. It is a low income neighborhood – do you understand that?

Let me make a fair comparison. I was renting an apartment 6 years ago about two blocks from that rowhouse. I was paying $350 a month for a two-bedroom apartment. When I bought my house, I found an older place east of downtown that was remodeled but needed some work. I got a 1400 sq foot home for $68,000 with $4,000 down. I put another $7,000 into the place since I have owned it, and I probably have about $2,000 worth of work to do to bring it up to snuff. On top of that, it is a stand alone home, with a new garage. I don’t share a wall with anyone and my mortgage is about $450 a month. So why on God’s green earth would someone pay $126,000 for and row house in a worse neighborhood? Or pay $750 rent for that matter? Obviously they won’t. I have often said the best way to clean up those neighborhoods is too have an overly aggressive community development program that gets young first time homebuyers to buy the houses that currently exist and give them an equity loan right off the bat to fix up the places.

Nope. Not how Sioux Falls works. Tear it down. Build it new and pay twice as much for twice as little.

Signs psp



#1 Sy on 05.21.09 at 2:29 pm

Guess what L3wie? I’m with you on this one. I think the builder bent the City over and shoved it in sideways. $100+ a sf for a multi-family structure is pretty spendy and I’m pretty sure they aren’t finished off like the places in Prairie Vista. I also thought I read the Housing Authority picked up the tab for the site and the demo of the old structures, so if that $126K is on top of that, we really got screwed.

Oh well, look at the bright side. We shouldn’t worry about the renters not making their payments, all they need to do is run across the street and SHAZAMM: they got 2 months rent with some scratch left over for smokes and a trip down to Kings Casino.

#2 l3wis on 05.21.09 at 4:00 pm

I know you are not a fan of Dr. No Staggers, but he has been a big opponent of this project all along. Like I said above, there is other ways to redevelop this area without using very much public money.

#3 Plaintiff Guy on 05.21.09 at 5:59 pm

To identify a profitable venture, do what city government is not doing. It’s a good thing they have our money to spend and corruptly pocket. Otherwise, we’d be building a chronically homeless shelter for them.

#4 redhatterb on 05.21.09 at 7:59 pm

$750.00 a month rent isn’t low income. Unless a person is already receiving rental assistance, and then housing only allows up to $650 a month for a two bedroom. If the base rent is higher the tenent has to make up the difference. On housing assistance a single person has to live in a one bedroom or there again make up the difference in rent between a one bedroom and a larger unit. I bet none of those units is handicapped accessabile either.

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