When Michael Moriarty, executive director of OneHolyoke Community Development Corp., first saw the lot on Beech Street in Holyoke in 2015, it was what he called an “abandoned urban dump.” A fire had burned the house to the ground over a decade earlier, and only the foundation was rebuilt. A tree grew out of the foundation, and people would dump appliances and trash there. The overgrown property, surrounded by homes on a heavily trafficked street and down the block from a historic mansion, was a blight on the neighborhood.
That made it the type of project OneHolyoke — with government help — often takes on. In 2015, the city foreclosed on the property for unpaid taxes, then sold it to OneHolyoke for $2,000. The developer obtained federal funding from the US Department of Housing and Urban Development to build a two-family modular home on condition that the housing remain affordable and restricted to families with low incomes.
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OneHolyoke found buyers in Rafael Rivera and Sheila Velazquez. The couple moved to Holyoke from Puerto Rico in 2001 and now have two sons. They were living paycheck to paycheck, renting a small apartment in an area rife with drug dealing. Both worked at Holyoke Health Center — Rivera in maintenance and Velazquez in the pharmacy.
The couple met the income qualifications. HUD funding knocked the price from $300,000 to $130,000, and the family qualified for a mortgage and bought the building. The money they earn from renting out the second unit helps pay the mortgage.
Their unit has three bedrooms, a living room, a kitchen, and 1.5 bathrooms. There is a basketball hoop in the backyard, and the family turned the basement into a movie room, where the boys bring their friends. With stable housing and rental income, Rivera started his own cleaning company.
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“It’s the house of our dreams,” Rivera said.
While headlines often focus on Greater Boston’s expensive housing stock, some of Massachusetts’ urban centers struggle with the opposite problem: homes that are crumbling and abandoned, where the cost to fix them outweighs the home’s value. As Massachusetts struggles with high housing prices and a need to build more supply, the ability to turn blighted properties into usable housing is a win-win, creating housing while revitalizing downtrodden neighborhoods. Studies have found that repairing blighted homes in low-income neighborhoods is associated with a drop in crime.
The Massachusetts Institute for a New Commonwealth reported in 2019 that more than 1 in 10 housing units in Fall River, Fitchburg, Holyoke, and Pittsfield were vacant. There can be many reasons for blight — an owner dies without heirs, a fire damages a house and the owner doesn’t rebuild, or an owner can’t pay taxes and abandons the property. Often it comes down to economics. In neighborhoods with low property values, once a property falls into disrepair it can cost more to fix it than the house is worth.
Since 2019, blight has become less problematic in parts of eastern Massachusetts because rising housing prices make it more financially worthwhile to fix up and sell a home. State policy makers have also helped communities address blight. In 2020, MassHousing launched Neighborhood Hub, a program that provides grants for technical assistance to seven cities to combat blight. A 2021 economic development bill authorized $50 million for a Neighborhood Stabilization Program to fund the redevelopment of smaller blighted properties. The program has provided $12.7 million for 85 units, including 45 affordable units for qualifying first-time home buyers. MassDevelopment offers financing and grant programs.
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The attorney general also operates a receivership program, where municipalities refer properties with sanitary code violations. The attorney general’s office contacts the owner, and if the owner does not fix the problems, the Housing Court can appoint a receiver. That receiver — often a developer — repairs the property and places a lien to cover the costs. According to the attorney general’s office, between June 1, 2022, and June 15, 2023, around 85 properties were accepted into the program.
With public money in place — though developers say more would always be helpful — the next steps are figuring out how to accelerate the process of funding and building. This could involve speeding up the timeline for awarding money or making state and local regulatory changes to prioritize rehabilitating blighted housing. There may also be ways to use blighted properties to meet other housing goals, like increasing affordable units.
It’s difficult to get a comprehensive list of how many blighted properties are in Massachusetts and where. The US Census Bureau estimates there are around 65,000 residential properties that are vacant for reasons other than being seasonally occupied or on the market — like family reasons, foreclosure, or renovations. Of these, just under 9,500 are listed as abandoned, possibly condemned, or in need of repairs. The Postal Service has some data on where vacancies are concentrated. In Holyoke in March 2023, the Postal Service reported that 3.2 percent of residential addresses were vacant and another 13.6 percent were “no-stat,” a category that can mean abandoned or under construction.
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Moriarty said a recent influx of state subsidies for blighted properties helped make financing work and the important thing now is to ensure stable funding, while minimizing regulatory costs. For example, he said Holyoke placed a moratorium on natural gas hookups, so if he is renovating a building with an old gas-fired furnace, he can’t replace it. Instead, he has to wire a new electrical system. “All of a sudden, a heating system becomes a heating system plus electrical plus infrastructure, and what would have been an $80,000 to $100,000 cost will be a $250,000 cost,” Moriarty said.
Larry Curtis, president of Boston-based WinnDevelopment, a national developer of market rate and affordable housing, said blighted properties can be fixed for a fraction of the cost of building new because developers do not need to undergo the same zoning and permitting processes. But if a developer is looking to buy a property, the seller may not be able to wait a year for the developer to get approval for a public subsidy or tax credit. Curtis suggested there may be ways to expedite funding for rehabilitation projects, particularly those that meet other state goals, like creating affordable housing.
In Holyoke, the city government’s property preservation group points to the Beech Street home as a success story, an example of how the city and OneHolyoke partnered to turn a vacant overgrown lot into an owner-occupied home.
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But Aaron Vega, Holyoke’s director of planning and economic development, said the group still has a list of about 100 “problem properties” it would like to get control of and then find a cost-effective way to rehabilitate them. Holyoke used a Neighborhood Hub grant to develop a tool kit that informs developers about financial assistance programs and hire a consultant to walk developers through the process.
Vega said he reads about Massachusetts’ housing crisis and thinks of the projects in Holyoke’s pipeline waiting for tax credits and grants. “I have the space, I have the buildings, I have a lot of developers waiting to do the projects,” Vega said. “There’s not enough funding and it’s not fast enough.”
Editorials represent the views of the Boston Globe Editorial Board. Follow us @GlobeOpinion.
