What a Difference $1,000 Makes: Part One

This is the first article in a two-part series on neighborhood revitalization in Akron, Ohio. Looking for part two? Click here.

Zac Kohl’s opening bid on his home in Akron, Ohio’s Middlebury neighborhood? $1,000.

He eventually purchased the home for $4,000 — almost one-quarter of the listing price — then sank in about $60,000 worth of renovations. Five years later, Kohl estimates the property value at between $30,000 and $40,000, right on par with much of the Middlebury neighborhood. (According to Akron Housing Strategy’s Planning to Grow Akron report, nearly 33 percent of owner-occupied units in Middlebury are valued at less than $40,000 — forming the highest rate of low-value homes in the city.)

The reality that you may never recoup the money you put into renovating a property is a catch-22 for individuals who would like to reinvest in places that have suffered population decline. Akron, which was once the fastest-growing city in the nation, has lost 31 percent of its population since 1960. Since the year 2000, the city has lost more than 6,000 households, resulting in a growing number of vacant and abandoned properties.

Though Kohl did his due diligence in improving the home, he understands why many in Middlebury don’t do the same. According to Kohl, only 25 percent of the homes in Middlebury are owner-occupied. Many rental property owners don’t live in the neighborhood themselves. This makes it challenging to address blight and deterioration.

“When you have 75 percent of the homes in your community vacant or owned by absentee landlords, there is very little incentive for anyone to do much to their home,” says Kohl, who estimates healthy housing markets are 60 to 70 percent owner-occupied. “When the housing market is depressed and you can’t get a return [on your investment], what is the incentive to put anything in?”

““When you have 75 percent of the homes in your community vacant or owned by absentee landlords, there is very little incentive for anyone to do much to their home. When the housing market is depressed and you can’t get a return [on your investment], what is the incentive to put anything in?””

— Zac Kohl, The Well CDC

That question is exactly what prompted Kohl to do more than just invest in his home. Instead, he invested in the entire neighborhood by founding The Well CDC, a community development corporation geared at restoring housing and fostering a renewed sense of community and worth in Akron neighborhoods. The Well is one of numerous Akron-based CDCs that have formed in recent years, along with the Kenmore Neighborhood Alliance and the North Akron Community Development Corporation. [A CDC—community development corporation—is a nonprofit organization focused on neighborhood revitalization within a particular, small geographic area.]

The Well's work is part of a wider effort, led by Mayor Dan Horrigan, to revitalize Akron’s neighborhoods and reverse their decline. Kohl believes much of the population decline can be attributed to “loss of industry,” specifically the Big Four rubber companies that kept Akron booming through much of the 20th century. He also notes a general “movement toward the suburbs,” adding that, “the economy follows the money, [leaving behind] old-timers or people who can’t get out from underneath [mortgage debt due to] deteriorating home values.”

Revitalizing Middlebury

As Kohl sees it, Middlebury’s biggest assets are also part of its problem. The neighborhood is just east of the University of Akron, and also plays home to the Summa hospital complex and the Goodyear Tire headquarters—creating an attractive picture for out-of-state investors.

Goodyear headquarters, Akron. Source: harry_nl via Flickr. Creative Commons license.

“If you know nothing of Akron, and you’re looking for a Rust Belt city to buy [a house] cheap and rent [it out], you will look at this area and say, ‘Wow, a billion-dollar hospital corporation, a 20,000-person university, and the Goodyear world headquarters,’” says Kohl. “There are a lot of pockets of wealth that surround Middlebury.”

The resulting housing issues are two-fold, according to Kohl. The first is that it creates a “unique dynamic for outside investors and slumlords who don’t really care about the properties. They can purchase a home for $10,000 to $30,000 and rent it for $700 to $900 [per month]—or even more with federally funded housing vouchers.”

The second issue is instability caused by the high proportion of rentals. “Our unique position [relative] to anchors of wealth bumps up [prices in] the rental market, which creates unhealthy situations where people end up moving around a lot,” says Kohl, who says he bought his own home from a “woman in California who’d never stepped foot in Ohio.”

Though the area has been named a “future hot spot” in the Greater Ohio Policy Center’s “Build in Akron” report, Middlebury has had difficulty attracting developers due to its below-market-rate housing values. That’s why Kohl and The Well CDC are undertaking an ambitious venture of renovating “60 Homes in 60 Months,” an effort designed to put homeownership back into Middlebury residents’ hands. (See part two of this series for more on this project.)

Creating More for Kenmore

To the southwest of Middlebury is Kenmore, a neighborhood that is also identified in “Build in Akron” as one of Akron’s five “future hot spots.” Kenmore’s housing picture is a bit brighter—with just seven percent of homes valued under $40,000 and a 12 percent vacancy rate. However, its number of households decreased by almost eight percent from 2000 to 2010, and its median home value is still only $51,330.

According to Tina Boyes of Kenmore Neighborhood Alliance, the organization’s overall strategy for addressing blight is to focus first on the commercial aspect, rather than residential — with the idea that one will follow the other. They plan to build on the momentum from a successful Better Block event held last September.

Small businesses on Akron's Kenmore Boulevard

“Kenmore is blessed with the largest contiguous business district outside of downtown Akron,” says Boyes. “[Kenmore Neighborhood Alliance is] relatively new to the community development arena, and we have limited resources, so we felt strongly as an organization that we need to focus the resources we do have on our business district.”

Kenmore Boulevard was named one of Akron’s “Great Streets” in early 2018, which means it will have access to tree planting, CDC support funds, a revolving loan fund for small businesses, and façade improvement grants. (Several intersections in Middlebury were also selected as Great Streets.)

“We know that people want to live in neighborhoods where there are ‘great streets,’ so we believe that what we’re doing will improve housing in the area over the long term,” says Boyes.

To that end, both the Kenmore Neighborhood Alliance and The Well CDC received $240,000 grants from the Knight Foundation last September to accelerate development in those areas. So what’s next? Several possible solutions are in the pipeline—and, as Kohl knows well, many of them can be kickstarted for just $1,000.

Continue to part two of “What a Difference $1,000 Makes” to learn more about how very small investments might help break the vicious cycle of neighborhood decline. $1,000 can be enough to matter, in Akron and elsewhere.

(Top photo credit: Shane Wynn via AkronStock.com )

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This essay is part of an ongoing engagement with Akron, Ohio, supported by the Knight Foundation. Learn more about it here.

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