A good article from Governing Magazine about the trend, focusing on one town—a trend we see in many of Sacramento’s suburbs—which is good for some, bad for others, but definitely here to stay.
Personally, tear down rebuilds that are congruent with the existing neighborhood are the ideal.
Erica Hamilton’s street was a wreck this summer. All the asphalt was removed, leaving vehicles to churn up mud, as if the street were an off-road racetrack. Construction has become a given on Hamilton’s block in Edina, Minn., a suburb of Minneapolis. Modest homes constantly are being torn down and replaced with newer, larger, swankier houses.
Hamilton thinks it’s great. She views the hammering and mess as a short-term hassle well worth enduring in exchange for increased property values and a new set of neighbors. Hamilton has had two children since moving onto Halifax Avenue five years ago, and she loves the fact that other young families are buying here. “I’m seriously all for it,” she says. “I don’t think you could have this experience of families with young children, unless you drive far out.”
Residents of her block can easily walk to a shopping area called 50th and France, where there’s an arthouse movie theater, a cupcake boutique, a store selling “fresh handmade cosmetics” and a French bistro that has bestowed multiple fake awards on itself, including a jury prize for “most attractive frog legs.”
People may love the location, but they won’t settle for any old house. If Edina isn’t the teardown capital of the country, it’s certainly one of them. In a city of just under 50,000 residents, more than 550 homes were torn down and rebuilt between 2008 and 2014. A far greater number of homes have been remodeled, with new rooms added on. There are contractor trucks all over town. Much of Edina’s housing stock was built during its first population boom in the 1950s and 1960s, and it isn’t large enough or designed in an appealing way for prosperous 21st-century buyers. They tend to prefer a newer house with modern amenities, such as a bigger kitchen, more bathrooms and an open floor plan. If they have to rebuild in order to get what they want near the metropolitan center, they’re willing to do that.
It’s been a financial boon for the city, arguably Edina’s greatest windfall since the Southdale Center mall was built back in the 1950s. The average value of homes that have been torn down and replaced has spiked from $377,000 before reconstruction to more than $1 million afterward. In fact, the city collects three times as much property tax revenue just from recently rebuilt homes as it does from the shopping mall. “Our choice is to get denser or allow tax rates to go up,” says Scott Neal, Edina’s city manager. By allowing the former, “we’re able to keep the cost of running the city at a reasonable rate.”
Around the country, other suburban communities are seeing similar types of infill development. Many close-in suburbs are struggling, with poverty increasing and the housing stock and schools caught in a downward spiral. But some are thriving. Young city dwellers still often make the choice to move to the suburbs when they have kids, but many of them would like an updated house and don’t want a commute that’s 40 minutes long on a good day. So they look for a close-in suburb, buy an old house there, tear it down and build what they want.
It’s not quite the return of 1990s-style McMansions. But in the close-in suburbs of such cities as Atlanta, Boston and Washington, D.C., as well as Minnesota’s Twin Cities, old ramblers and bungalows and other postwar suburban homes are being taken down and replaced with something new, whether they’re big-footprint homes or townhouses. “The houses that are going out are shabbier, the houses that are going in are nicer,” says Robert Denk, senior economist with the National Association of Home Builders. “That’s good for the tax base, it’s good for the job market, it’s bringing money in.”