Minneapolis Advantage Demonstration Program

The Minneapolis City Council approved a demonstration program, the Minneapolis Advantage Program, a downpayment and closing cost assistance program to help rebuild the housing market in key neighborhoods that have experienced mortgage foreclosures.

The demonstration program provided $10,000 deferred loans to buyers of houses in neighborhoods heavily impacted by foreclosures. The program was funded by $500,000 which allowed for 50 loans, forgiven over a five-year period. All funding is fully committed at this time.

Results of the Demonstration Program

The following statistics demonstrate that the program has been effective in encouraging the public to buy in the communities stressed by foreclosures.

Property Details

  • Properties were required to be on the block with a foreclosed home: 62% of the properties were foreclosed and 9% of the properties purchased were boarded and vacant.
  • 62% of the properties, registered as non-homestead prior to being purchased, now have a homestead status.
  • The program had a mix of purchase prices, but more than 50% of the buyers bought homes under $100,000 and 82% purchased homes under $150,000.
  • Half of the eligible neighborhoods were in North Minneapolis; 80% of the homes purchased were located there.
  • Map of Properties Purchased Using the Minneapolis Advantage Program

Buyer Details

  • Even though there were no income restrictions, 76% of the buyers were at 80% MMI or less. Since home prices were low, the program made home buying affordable.
  • The majority of the buyers were younger, with 57% younger than 36 years old.
  • 78% of the buyers were first-time homeowners.
  • 65% of the homeowners are White (not Hispanic); 13% are African-American; 19% are Asian; 3% are of two or more races.
  • Nearly 30% of the households moved from the suburbs or Saint Paul, and of those, 95% moved to the eligible North Minneapolis neighborhoods.

Demonstration Program Information

Online Report