Portage Tries Something New to Fight Housing Crisis
*PORTAGE, Mich.* — Owning a home is called the American Dream, but it's become so expensive between high home prices and higher interest rates, that it's not attainable for a growing number of people.
Drew Forsyth wanted a new home, but wasn't sure he could afford one.
"I always considered my family to be middle-class. And since I've grown up, I feel like I've witnessed the dissolution of the middle-class to a large degree," he said.
Business and political leaders are looking for new ideas to help when it comes to housing. Forsyth's realtor told him about a concept the city of Portage was trying through a development called Stanwood Crossings.
Drew Forsyth touring a new home being built at Stanwood Crossings in Portage.
"This community land-trust concept that we're putting to work here, is the first one in Kalamazoo County," Patrick McGinnis, city manager of Portage, said.
"There's only a handful of them in Michigan, so we hope to be able to grow this concept to deliver more affordable housing throughout the state of Michigan."
Construction is underway at Stanwood Crossings.
42 affordable new homes are being built, and the person living there will also own the home.
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Portage used American Rescue Plan (ARPA) Funds to buy the land.
The city is also using a state development tool called Tax Increment Financing (TIF), which allows Portage to use future tax money from the project for the development.
"When my realtor described what the program was, I thought we should be doing this all over the place," Forsyth said.
Dan Jaqua, owner of Kalamazoo based Jaqua Realtors, helped connect Forsyth with the project.
Jaqua has been working on affordable housing initiatives for years and believes community land trusts offer a sustainable solution to the housing crisis.
"The traditional model of selling land and letting developers build on it doesn't work anymore," Jaqua said. "Prices keep going up, and nobody can afford to stay in their home."
Community land trusts work by separating the land ownership from the home ownership. The city or a nonprofit owns the land, and residents own the structure they build on it. This dramatically reduces the overall cost and makes homeownership achievable for working families.
The 42 homes at Stanwood Crossings will be built on the city-owned land, and residents will purchase the homes at below-market prices. The city retains ownership of the land indefinitely, which prevents future developers from driving up prices.
Portage's approach addresses several key issues:
- High housing prices
- Limited inventory
- Rising mortgage rates
- Need for long-term affordability
The project received state support through the Michigan Housing Development Authority, which provided funding to help make the homes affordable.
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The city manager said they're already looking at expanding the concept to other developments.
"We want this to be a model for other cities in the state," McGinnis said. "If we can prove it works here, we can replicate it elsewhere."
Jaqua Realtors has been instrumental in connecting families with affordable housing options throughout Kalamazoo County.
The city of Portage has been working on housing solutions for years, but this represents a new approach that could have lasting impact.
"We've tried traditional zoning changes, we've tried density bonuses, but none of those things really solve the problem," Jaqua said. "This is different because it actually keeps the homes affordable for people who work here."
The 42 homes will be available to local families who meet income requirements. The goal is to create a permanent affordable housing solution that benefits the community for generations.
More information about the Stanwood Crossings project and application process will be available through the city of Portage website and Jaqua Realtors offices.