HOUSING

As in nearly every other community, housing presents a significant challenge in Villisca. This challenge presents itself differently in each city. Data from the US Census Bureau provides some insights into the situation in Villisca:

  • 53% of occupied housing units were built before 1939
  • Only six new homes have been built in the last 19 years
  • 156 one-person households, up from 106 one-person households in 2010
  • 165 renter-occupied housing units, up from 125 renter-occupied housing units in 2010
  • $55,300 median value of owner-occupied units
  • $613 median rent

Source: Census Bureau American Fact Finder

While the Census data allows one to draw the conclusion that there is a housing shortage in Villisca based on the increased number of one-person households coupled with the construction shortage, the issue is further compounded by issues with property maintenance throughout town. This is not a singular occurrence in Villisca; rather, it is a singular challenge that persists throughout nearly every rural community from the Midwest to the Mississippi Delta.

Fortunately, there are a number of tools available to begin addressing both the number of units available as well as their conditions. Potential solutions are laid out in the following sections.

Volume of Available Homes

Second Story Units

Villisca is fortunate to have a core of architecturally interesting buildings in its core; many communities have lost these gems. While there are some buildings with significant structural issues around the square, there also are many buildings that present prime opportunities for second story units. Of the 39 parcels in the business district, 33 are home to a business. Villisca community leaders need to:

“Rural communities also can’t thrive without access to housing. Businesses in rural Iowa are growing and hiring, but the employees they need won’t make the move if there’s no place for their family to call home. I am therefore requesting that we double the amount of workforce housing tax credits that are set aside for rural communities, putting the total at $10 million.  I’m also asking that these tax credits be competitive, meaning that they will go to those projects that are well planned, not just first in line.”

– Governor Kim Reynolds, 2019 Condition of the State Address

INTRODUCING VISITORS TO VILLISCA

A significant opportunity to introduce people to downtown Villisca without them moving to town lies in short-term rentals such as Airbnb or VRBO. Currently, the nearest such rental is just outside of Bedford, more than 20 miles from Villisca. With the draw of the Ax Murder House, Villisca undoubtedly needs more short-term rentals, and second story units are an easy way to fill this need. These units are popular with visitors because of their usual location in the center of a community and ease of access to restaurants, bars, etc. Furthermore, a short-term rental may generate more income for the building owner than a traditional rental.

Additionally, Villisca may explore another Airbnb-inspired endeavor. It was recently announced that the company is working with Grottole, Italy, a community of only 300 people that has 600 vacant homes. In short, the program will select four people to live in the community for three months with free housing and up to $1,000 of living expenses covered each month. According to one Airbnb official, “We will find every way possible to support sustainable tourism, and give visibility to these rural areas.” The hope is that people taking advantage of this program will bring new skillsets to town and that it will allow communities yet another way to preserve themselves. Also of note is the potential press that could accompany such a program, thereby encouraging even more tourism to the community. While perhaps not quite as picturesque as Grottole, Villisca does have an interesting history.

  • Grattole
  • Grattole
  • Grattole
  • Grattole

Convene a meeting of these property owners to gauge interest in developing second story units, determine what opportunity exists in each building, and understand what incentives need to be established

Knowing millennials and baby boomers will be the largest demographics for the second story units, host workshops with these groups to understand what they might want in downtown units

Establish goals for the second story program; consider how many units incentives could realistically be established, the vision for downtown, the demand for rentals, and changing demographics

Work with city officials, Montgomery County Development Corporation, the Southwest Iowa Housing Trust Fund (SWIHTF), the State of Iowa, and private businesses to establish an incentive package to help interested building owners renovate the upper levels of their respective properties; these incentives may include tax abatement, Tax Increment Financing (TIF), grants, or low interest loans

Reconvene business district property owners and share the available incentives

Work with interested property owners to secure architects, engineers, construction teams, bank relationships, etc., to ensure second story units are developed and the program is a success. Be sure to max out incentives for the first five years at a minimum; the program will take some time to establish, and its true value will be shown when units are renovated over a number of years, ultimately leading to a critical mass of people living downtown.

When the first units are complete, work with property owners to take professional photographs to use in advertising for the program. Consider using a professional stager to enhance the attractiveness of the units.

Infill Program

It goes without saying that Villisca must take a comprehensive approach to addressing its housing challenges. While apartments and condos are important, new single-family, duplexes, and fourplexes should also be constructed. It is evident that new construction is more expensive than renovating an existing building; however, one strategy to offset the typical costs associated with new development is to focus on infill development. By constructing new units where infrastructure already exists, developers and, eventually, homeowners are able to save significantly. To accomplish this, Villisca leaders need to:

UNCOMMON INCENTIVES

Communities across the country have devised innovative incentive programs to entice people to move to their respective communities. Each is unique in its scale and scope, but the following are intended to inspire Villisca leaders to think beyond the more typical tax incentives.

Marne, Iowa

The City of Marne gives people who are going to build a home in the community a free lot to build on. The home can be conventional construction or prefabricated. Lots range in size but average about a quarter of an acre. The application and requirements can be found in Appendix A.

State of Vermont

A new program enacted beginning in January 2019, the Vermont Legislature created the Remote Worker Grant Program to incent people to move to Vermont while working for businesses not located in the state. Participants in the program may receive up to $10,000 over two years to assist with the actual costs to relocate as well as computer software or hardware, broadband access, and a membership in a co-working space. More information can be found in Appendix B.

Newton, Iowa

Newton’s housing initiative provides $10,000 cash to people buying a new home in the community. Furthermore, they also throw in a “Get to Know Newton Welcome Package” that is valued around $3,000. Permit and inspection fees are waived as well.

Inventory vacant lots and vacant buildings

Gauge willingness of owners of vacant lots and buildings to remediate the issue or sell the lot; if necessary, be prepared to go through the tax sale process to acquire the lots and buildings. Some of the buildings may present public safety hazards, so there is an opportunity to financially compel owners to cooperate with the community.

Based on findings of the inventory and discussions with property owners, develop a strategic plan to tackle the challenge; it is recommended to focus on a smaller geographic area to more effectively boost property values in that area of town before moving onto the next area

As with the second story units, consider an incentive program in partnership with the city, Montgomery County Development Corporation, SWIHTF, the State of Iowa, and private businesses

Quality of Homes

Like most communities, blight is a challenge in Villisca. For some homeowners or landlords, property maintenance issues arise due to financial issues. For others, it is a lack of pride in ownership that leads to these issues. Regardless of why they arise, Villisca must address both existing challenges with the quality of homes as well as work to prevent future challenges.

Property Maintenance Standards & Rental Inspection Program

One of the first steps in improving the quality of homes in Villisca is establishing property maintenance standards. These standards would shift maintenance from an option to a legal requirement, protecting and growing property values throughout the community. It also would protect the health, safety, and welfare of residents.

However, a minimum property maintenance code is not enough. The City need to commit to enforcing the policy; it does no good to create a policy if there is no action behind it. Recognizing that staffing this kind of program can be a challenge, it is recommended that Villisca seek to partner with the City of Red Oak as it launches this program. Red Oak has adopted various measures over the years to address these kinds of challenges, so it makes sense to partner with and learn from them.

RENTAL INSPECTION PROGRAM

The property maintenance standards should be coupled with a rental inspection program. Like the property maintenance standards, the International Property Maintenance Code should serve as the basis for the rental inspection program.

The City of Red Oak launched a rental inspection program around four years ago. In the first phase of their program, officials inspected the 700 rental properties, including houses and apartments, in the community. With this work complete, officials are now revisiting the properties and getting tougher in their reviews.

However, there are alternate methods to pursue as the rental inspection program launches. The City of Clive in the Des Moines metro has a three-tiered approach to compliance: Self-inspection, audit inspection, and complaint inspection. In short, self-inspection allows the property owner to register their unit(s) and then to conduct the inspection using a form from the City. Under the audit inspection, the City reviews the submitted reports and then selects approximately 17% of the units to review each year; this means that audit inspections operate on a six-year cycle. Finally, under the complaint inspection, the City responds to inquiries from tenants. An in-depth description of the Rental Inspection Guide can be found in Appendix C, and the Rental Housing Program Guidelines can be found Appendix D.

Develop and adopt a housing code to address both minimum property maintenance standards and rentals using the International Property Maintenance Code as a starting point; the City of Red Oak has adopted the 2012 version. Tailor the code as need for the community and adopt at the Council level.

Working with the other area communities and SWIHTF, design a local enforcement mechanism. It will be imperative to determine staffing needs, priority nuisances to address, means of resolving complaints, and funding commitments from the partner organizations.

If Villisca chooses to partner with another community and/or SWIHTF, commit to ongoing collaboration with a formalized agreement. Seek to work with a lawyer in a pro bono capacity if possible and include language on the responsibilities of each entity as well as their respective financial commitments.

Hire enforcement staff or assign these new duties to existing staff if capacity exists. It will be critical to provide proper training to ensure effective enforcement and, ultimately, an increased taxable valuation.

Blight Remediation Program

The final component recommended to address Villisca’s housing challenges is a blight remediation program. This will complement the other programs outlined above and will allow the City to take an even more proactive approach to community betterment.

Establish parameters to define ‘blight’ in Villisca and develop a scoring system to weight various components of blight; a sample can be found in Appendix E.

Inventory properties throughout the community to assess blight using the tool created in step 1. It will be important to categorize the homes defined as ‘blighted’ into two overarching groups: Those that should be demolished and those that should be rehabilitated.

For the homes that can and should be rehabilitated:

Work with SWIHTF to access their Community Development Block Grant (CDBG) funding. This is designed to “provide repairs to bring homes up to Iowa Minimum Housing Rehabilitation Standards. Assistance is provided as a 5-year forgivable loan. Requirements include, but are not limited to, residing within the target area, income qualified, home must be the primary residence of the owner, and must apply within the posted time frame. Applicants are selected by an appointed housing committee.” It will be important for local leaders to help SWIHTF leaders understand the City’s coordinated and comprehensive strategy. This will position the City for greater success in securing the funds.

With this information in hand, work with property owners to understand their willingness to address the blight and to understand if they will meet the CDBG requirements. If property owners do not meet the requirements, the City should work with area foundations to provide seed funding for a revolving loan fund that can support home improvements. With unknown funding request levels, this fund should initially be targeted, looking perhaps at priority corridors, homes near the business district, or homes where children live.

Continue to work with willing property owners to make the enhancements to their respective homes. Make it easy for them by creating a list of area architects, engineers, plumbers, electricians, painters, construction teams, general contractors, landscapers, etc. If multiple people choose to work with the same teams, there may be some economies of scale.

THE COST OF DEMOLITION

Demolition of a home costs, on average, anywhere from $4 to $15 per square foot. Fortunately, that number is generally lower in smaller communities. If one estimates an average home size of 1,500 square feet, they could plan on anywhere from $6,000 to $22,500 for demolition costs. Then consider that SWIHTF will pay 50% of demolition fees for City-owned properties, and the cost shrinks to a range of $3,000 to $11,250. At this rate, the City could demolish between 4 and 16 homes per year, meaning this challenge could be addressed in just a few years.

For the homes that need to be demolished:

Work with property owners to understand if they are willing to complete the demolition or if they are willing to turn the property over to the City.

If the property owner is going to take care of the demolition on their own, be sure to agree upon a timeline and any stipulations for the lot that remains after. Be prepared to rely on the enforcement staff described in the preceding section to ensure these stipulations are met.

If the property owner is going to turn the property over to the City, work with entities that may have claims on the properties in question to forgive any outstanding taxes, liens, etc. This will allow the City to move forward with the property free and clear, making eventual redevelopment much easier. Additionally, when the property has been turned over to the City, work with SWIHTF to secure a Demolition Grant; this program “assists cities in eliminating dilapidated housing units in their communities. SWIHTF will pay for 50% of costs for asbestos inspection, abatement, and demolition of city owned structures, leaving the property a clean, level lot.” The application can be found in Appendix F.

Tap into the revolving loan fund described above to pay for the remainder of the demolition costs. Alternatively, the City could budget for demolition work each year. Begin with a minimum $50,000 per year and adjust in future years based on demand. If the City is able to dedicate more money to this program, it will obviously be able to address this issue in a shorter timeframe.

After the structure is demolished, market, market, market! Consider adopting a program similar to Marne’s whereby the City would give the lot to people who commit to building a home of a certain value there.