Vacant homes for $1? New city policy could set prices

Members of the Baltimore City Council are set to discuss an initiative this week that would lock in a fixed rate to purchase some vacant properties and lots in Baltimore — some as low as $1.

The so-called fixed pricing policy, designed by the city’s Department of Housing and Community Development and backed by Mayor Brandon Scott, aims to speed up the process of returning some of Baltimore’s abandoned homes and lots to productive use by eliminating the need for price negotiations for eligible city-owned properties. It also would enable the city to accurately advertise the price of some of its inventory, allowing potential buyers to make “informed decisions” before applying, according to a policy memo written about the measure.

But the program comes with requirements that could make it unfeasible for most people considering buying, renovating and living in one of the $1 homes.

The proposed pricing schedule differs from the city’s “dollar house” program of the 1970s, said Baltimore housing commissioner Alice Kennedy, which offered homes at $1 and made low-interest renovation loans available with help from the federal government. That program, which helped resuscitate some city neighborhoods, including Federal Hill and Otterbein, has been considered for revival by city lawmakers on and off over the years.

“This is just one piece of the puzzle,” Kennedy said in an interview, calling it an efficient way to transfer some properties to new, responsible stewards. The lots and buildings already are listed on the city’s Buy Into Bmore database, which launched in March 2022 as a way for people to apply to purchase vacant properties to rehabilitate.

“It’s hard to keep the waters clear in terms of what this is, and what it is not,” Kennedy said about the fixed pricing policy, which is scheduled for a committee hearing Tuesday afternoon. “This is not the only way we dispose of properties — currently or in the future.”

Already, at least one member of the City Council has called the proposal into question, saying the housing department could use more time to improve it. And City Council President Nick Mosby, who has advocated for a return of the “dollar house” initiative, said it might turn needed resources and attention away from legacy residents and homeowners.

The price structure would apply only to some of the city’s total inventory, Kennedy said. She declined to give an estimated figure but noted that eligible properties cannot be part of an existing development project and can be added or removed from the fixed pricing designation at the city’s will. Most of the city’s vacant properties are located in West and East Baltimore, but the exact numbers and locations of those eligible for the fixed price sale were unclear

For-profit developers would be able to purchase city-owned vacant buildings for a flat rate of $3,000 and vacant lots for $1,000, on the condition they are redeveloped for residential or mixed-use residential purposes. Nonprofit organizations would have the same requirement but a lower price point: $1,000 for vacant buildings and $500 for lots.

Individual homeowners, meanwhile, would be offered a fixed fee of $1 for vacant buildings and lots if they agree to maintain the buildings as primary residences for at least 5 years. Vacant lots also would be required to house residential buildings.

Community land trusts — entities that own land on behalf of communities — would also be offered the $1 rate if they are registered as affordable housing land trusts with the state and in compliance with housing land trust laws.

Applicants must undergo a screening process that includes criminal charges that could limit their ability to complete a project and open judgments or liens. Applicants also cannot own a vacant building that has been empty for longer than two years.

Applicants are expected to complete renovations and obtain an occupancy permit within a year of settlement. And, crucially, they must have $90,000 available to rehab each property they apply for — which Mosby and City Councilwoman Odette Ramos say could keep the program out of reach for those most in need of affordable housing.

Kennedy said about 200 people have inquired about 300 buildings and lots, and the fixed-price schedule would help speed up the process of getting them sold. Those deals have been put on pause, she added, as the department works through getting the pricing structure passed.

She said more predictable pricing on the city’s end would enable the department to offer more support to buyers.

“We want to know if you have a tie to a property, because it was your grandmother’s or your great aunt’s, and we want to build that in so as people fill it [the application] out, we can work to ensure people have the resources —financial resources or technical assistance — to help them complete the project,” Kennedy said.

Baltimore’s mayor-controlled spending board is scheduled to vote on the pricing schedule Wednesday. The mayor holds one seat on the Board of Estimates, as does City Council President Nick Mosby, who has already deferred the item once.

Mosby’s attempt to revive the 1970s dollar house program two years ago was panned by Scott’s housing department and failed to get out of committee. At Monday night’s City Council meeting, the council president criticized the administration’s proposal, arguing that their approach fails to provide necessary guardrails he had included in his 2022 legislation to ensure the program reaches the legacy Baltimore residents most affected by discriminatory housing policies.

Mosby’s dollar house initiative included criteria to target low income households — including people who had been evicted, families receiving housing subsidies and people facing debt — and called for $200 million in federal pandemic aid to finance home repair grants for participants.

“I’m concerned that we are developing programs to stabilize communities on the backs of folks that need affordable housing opportunities,” Mosby said of the proposal going before the Board of Estimates this week. “Once those communities turn around, the communities become stabilized, they can no longer afford to stay there. That’s unacceptable.”

On Tuesday, Mosby and other members of the City Council took turns leveling criticism at the housing department over the initiative, calling it half-baked and not rooted in equity.

“I don’t see no benefit here for people who live in this city,” said Robert Stokes, who represents East Baltimore, adding that he feared the fixed pricing would enable gentrification. “We know what happened in D.C. It’s right now happening in Baltimore.”

Kennedy later clarified that Baltimore residents would have priority in purchasing. She also pointed out that the department had worked on it for about two years, and that the Board of Estimates’ vote would only cover the pricing structure and not the initiative itself.

The fixed pricing policy is one of several vacant housing-related initiatives put forward by the Scott administration as the mayor gears up to run for a second term.

Late last year, Scott, along with partners at the Greater Baltimore Committee and the interfaith community group BUILD Baltimore, unveiled an ambitious and expensive plan to tackle the city’s decadeslong vacant housing crisis. City estimates peg the problem at around 35,000 buildings and lots total, with a majority of them concentrated on the city’s East and West sides.

During Scott’s term, the number of vacant buildings has fallen from more than 16,000 in December 2020 to around 13,500 now. But the mayor said in December that the crisis required a sustained, multiyear investment, and called on state lawmakers and the governor to help fund the work, which he valued at around $8 billion.

So far, the governor has not committed to partnering on the work, which calls for $900 million in state funding over a 15-year period and a local share of state sales tax receipts from the city. The governor’s proposed fiscal year 2025 budget does, however, allocate $50 million for the city to put toward rehabilitation and demolition of vacant properties, which Scott said in a January statement “puts us well on our way to fulfilling the 15-year plan we put forward.”

Kennedy said the fixed pricing proposal adds yet another tool the city can use to meet its goals.

Still, Ramos, the former executive director of the Community Development Network of Maryland, asked the housing department in a Monday letter if it could postpone the item from the city spending board’s review again, arguing the policy contains holes.

Ramos commended the fixed pricing approach, especially at the $1 rate for community land trusts and homeowners. But she said the idea would not help the city attack its vacant housing problem at scale or align with its comprehensive “whole-block approach.”

“Disposing one house in the middle of a block of vacant properties that have yet to be acquired disadvantages the purchaser,” Ramos said in the letter.

She also noted that the “first-come, first served” application process might skew toward people with more resources and may not produce much affordable housing. “We cannot randomly make properties available to just anyone to meet the goals of the neighborhood,” she said.

Ramos also asked the agency how it might keep buyers accountable and to review its screening process to determine eligibility, saying it might exclude applicants who are “doing the good work” but might have had run-ins with the justice system.

Kennedy pointed out that applicants for Buy Into Bmore have always been carefully vetted, and the rolling application basis helps the process move faster. If a property receives multiple bids, the first applicant has no guarantee of acquiring it, she said. She welcomed having more conversations about the guidelines.

She also pushed back against the critique that the fixed pricing policy would not complement a “whole-block” approach. Rather, she said this process helps clamp down on bidding wars and gives the city more oversight over who buys vulnerable properties.

“This is one component of an entire suite of disposition methods that supports whole-block outcomes,” Kennedy said. “This is not the entire world and does not represent the entire world of the work we do at DHCD.”

The headline has been updated to correct the proposal is a policy rather than a City Council bill.

Baltimore Banner reporter Adam Willis contributed to this article.

Hallie Miller

hallie.miller@thebaltimorebanner.com

Hallie Miller covers housing for The Baltimore Banner. She's previously covered city and regional services, business and health at both The Banner and The Baltimore Sun.

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