In today's city, every neighborhood is connected.
The needs of any part of the city come home to us all.
The need and the search for housing.
The longing especially for a home of your own.
For middle and lower income families, it's not easy in today's market.
And while they are denied, there are good houses standing empty, neglected, becoming a problem.
The city's own need is for new neighbors on the block.
Taxpaying owners to live in these empty, neglected houses.
Houses that cost the city dearly in lost tax revenues, services, and a general decline that sends neighbors packing and produces still more abandoned homes.
These problem houses sorely need live -in owners to protect them and care for them.
To keep them from becoming a blight on the neighborhood.
And Chicago's Mayor Richard Daley is deeply concerned.
Ladies and gentlemen, you all know the problem that has been besetting the cities of America in abandoned homes and neighborhoods.
We're not at this time going to charge anyone with the responsibility.
But we do think the most trained problem the cities and the urban communities face is abandoned buildings.
Buildings that are abandoned.
And we have prevailed upon Washington to experiment with what could be done with approximately 3 ,000 homes that are in Chicago in good neighborhoods under some program of rehabilitation and put fine families in them that we would be proud of and all of us would be proud of.
And take the first step in answering this serious problem that confronts Chicago in every city.
Like in the area that I'm in, in the Austin area, there are quite a few abandoned buildings boarded up and whatnot.
And they've been like that for three, four years, you know, since I've been there.
And that's quite a long time for a house to be sitting there just abandoned, you know.
The problem became epidemic because lending policies made it easy to buy a home like this, but hard to hold on to if income and know -how were limited.
One homeowner after another overwhelmed by repair and other problems defaulted on FHA loans and the homes are lost only to sit idle, boarded up by the new owner, the Federal Department of Housing and Urban Development.
Now HUD is joining with the cities in a homesteading experiment to bring these houses back to life.
Not 25 acres out on the Western Frontier, but a house here in Chicago for just one dollar.
And here in Chicago, so many were eager to get into the Homestead Act that a lottery was held to select the new urban pioneers.
Here's Urban Renewal Commissioner Lewis Hill.
All applicants to be found qualified were required to meet six basic criteria established in the initial application of the homesteading program.
The requirements were first, be at least 18 years old and be the head of a household.
Second, be a citizen of the United States of America or a registered alien.
Third, be a resident of the city of Chicago.
Fourth, have a demonstrable need for housing.
Five, have an established source of income sufficient to carry the normal expenses of property ownership.
In their guidelines for the homesteading program, HUD has repeatedly stressed the point that it should not be considered a program for quote, poor people.
Six, have the financial and or construction ability to rehabilitate an existing dwelling into code compliance.
In our judgment, all of the 207 families participating in the lottery this evening have the capacity to be successful homesteaders.
We only wish we had sufficient properties available to accommodate all of you.
There are 44 homesteads to be awarded.
Mayor Daley will draw the first name.
Perhaps Mr.
Mayor, you'd like to come forward and we'll move the cards around and select our first one.
From Group A, Number 1, Armazelle Johnson of 8421 South Point.
Number 1 in Group A, Mrs.
Johnson, a key punch operator, will have the first choice among the two bedroom homes.
Jerry Williams, 8109 South Harper.
Jerry Williams is a winner in the B category.
He will have a house with three or more bedrooms.
Number 4 in Group B, Larry Strong, 1099 A, North Milwaukee.
For bus driver Larry Strong, it's a special day.
Altman Carey -Gavinsky.
That's a pretty good birthday present, isn't it? Thanks, birthday present for Mr.
Strong.
Group A, Number 4, Tommy L.
Taylor, 8018 Langley.
Number 6 in Group B, Edward R.
Morgan, 401 East 32nd Street.
Number 28 in Group B, Robert R.
Owens, 5201 South Federal Street.
Number 25 in Group B, Craig Martin, 1072 East 134th Street.
These are Chicago's homesteaders, responsible, hardworking people with steady jobs.
Altogether, 44 Chicagoans who their city feels will make the most of the homestead opportunity.
They are winners among 2 ,000 interested people who received applications from the Department of Urban Renewal.
766 applications came back to be reviewed by Homestead Coordinator Tom Marshall and his staff.
The Department of Urban Renewal had already spent long months of hard study and planning for the homestead program.
It was equally careful in selecting the people who would participate.
The city looked for good credit ratings, job performance.
It wanted well -motivated families who would work hard on their homestead.
There were endless consultations by phone and for the most promising applicants, a visit to the home.
Urban Renewal field worker Mary Wiley calls on the Reverend and Mrs.
Harry Wilson, parents of three children living at home.
She's here to become acquainted with them personally, to find out about their living conditions, and to make sure there is that real need for new housing.
And how many rooms are there, Mrs.
Wilson? Six.
Number of bedrooms? Three.
Do you want to discuss some of the problems you're having, Mrs.
Wilson? Well, I'm really so congested here that I don't, you know, we're running into each other in order to just to maintain a livid.
The DUR staff narrowed the list to several hundred people.
Marshall and Fred Lindstrom, director of rehabilitation for the city, presented the selected files to a special subcommittee made up of Commissioner Hill and DUR board members, Charles Tatum, president of Gateway Bank, and James Green, retired vice president of the Northern Trust Company.
The subcommittee, after full consideration and review of appeals, chose 207 lottery families, all with the capability to be successful homesteaders.
The selection came after HUD had implemented Section 810 of the Housing and Community Development Act of 1974 to help resolve several problems in homesteading which had been tried in other cities with mixed results.
Section 810 made available better houses for homesteading and authorized direct federal loans to the homesteaders at 3 % interest, removing the burden of conventional financing that had been a problem in the past.
The DUR board now gave its approval to Assistant Commissioner George Stone to go ahead.
In preparing our application for urban homesteading and in the implementation of that application since, we were very concerned that the program be a success.
We recognized that it was a demonstration program and that if it were not successful Chicago and elsewhere, it would begin and end with the first go round.
And we recognized the resources available to the city of Chicago were limited and that we would only get 40 or 50 properties, which by themselves would not solve a problem.
But we wanted to have a success so that the program would be extended and expanded in the future.
And we had three real areas of concern that we felt were important to make the program successful.
The first of course was the kind of area in which we put urban homesteading.
The city chose the community of Central Austin several miles west of the loop and a neighborhood called Roseland on the city's far south side.
While both of them in some ways were exhibiting the early symptoms of the all too familiar cycle of decline of urban communities, neither were so far deteriorated that we felt that they were a lost cause without major efforts at redevelopment.
Roseland had been one of the south side's most stable areas until the abandoned homes began to appear there several years ago.
About half its people are black.
Nearly 60 percent of the residents own their own homes, blocks or trim, pleasant one -family houses, a good neighborhood with good community services.
Central Austin, chosen first because of a large concentration of abandoned houses, but also because the community is trying hard to rebuild itself.
One example of a drive is the Neighborhood Housing Services Program, sponsored by the Urban Reinvestment Task Force.
This program in Chicago and elsewhere is a community effort directed by local residents and banks to help all homeowners in the area to improve their properties.
The community's own effort is essential since homesteading by itself is not enough to turn a neighborhood around.
Within the two communities, city rehabilitation experts insisted they must have good houses worth homesteading.
HUD agreed that the city could pick and choose.
Detailed studies were made on 150 repossessed houses.
The city chose to homestead 34 in Roseland, 10 in Austin.
All were basically sound.
They could be restored at reasonable cost.
Precise evaluation covered every kind of expense so that there would be no unexpected repair bills.
And DUR was ready for its homesteaders.
In our program, we built in as much help as we could think that homesteaders might need.
We made provision for assistance in obtaining contractors and developing specifications and obtaining financing at 3 % interest to finance repairs that needed to be made, either through the Section 312 program, which is the direct federal 3 % loan, or at 3 % interest using the city loan grant program, which was implemented in Chicago.
We also proposed to have a counseling program with homesteaders to assist them with financial and other problems they might get into.
Tom, just how important is counseling in this homesteading program? Most of the, well in many cases, well okay, you know it goes back to before.
Initially people hard -waved their underwriting requirements and they let just anybody go in, you know, at 5 % down or 2 % down or something or other like that.
These were marginal buyers initially.
Even in spite of that, if the people had benefit of counseling initially, we wouldn't have as much of a problem out there in abandoned houses at Austin and Roseland as we have now.
It caused this great impact and this great problem out there in those two communities.
In other words, it's the main ingredient.
That's the main thing.
Counseling begins right at the start as the lottery winners set out in CTA chartered buses with DUR field workers aboard to tour the 44 houses and decide which they would like to make home.
They'll make their choices and the houses will then be awarded by their rank in the lottery.
We're at the end of the winter now.
It's a chilly weekend in Chicago.
The houses are still boarded up bare and cold, but the homesteaders are happy to be making the trip.
It's a two -day affair, this open house, and there are many things to be considered.
Most important, the size and location of the house and the cost of repairs.
It seems to be pretty solid.
It seems to be pretty solid.
It wouldn't take that much to, you know, fix it.
It's really not that much worse.
Most of the walls, you know, the interiors, have to be fixed.
That's really not an eye to throw.
Well, I like them.
I've liked all of them I've seen so far.
That bill will be anywhere from $3 ,000 to $17 ,000 depending upon the house.
There are both old and newer houses, some built less than ten years ago.
The homesteaders are generally pleased with what they find.
You know, I am really surprised.
I really expected the houses to be in worse condition than they are, but they are not.
They are very good houses.
See, this is my first church.
The George Johnsons are number one in Roseland, and they know exactly what they want.
In the school, I have small children.
How many children? I have three girls.
And the school is right next door, almost.
It's across the street, and it's beautiful.
See, there are three lines that come...
Larry and Barbara Strong are making their choice and getting some advice from DUR's Charles Humphrey.
There are two 110 lines.
You put them together, it makes the 220.
That's why they got 110.
So would you have to be careful about what you plug? No, the electrician will take care of all of that.
You don't worry about it.
Rehabilitation Director Fred Dunstroom.
In the first place, the specifications is broken down into two parts.
Those parts of all the work which is required to meet the safe sanitary conditions that we all want.
But the second part is there is an emergency set of specifications in there.
In other words, that work which is required for heat, light, and water.
In other words, to make the building habitable, which will be done right away.
So therefore, you will be able to live in the house.
Now at the time that we transfer the title, we have made an arrangement with an insurance company.
And you don't have to go with this insurance company, but it is available under the fair plan that we're going to have insurance on your property at the time the property is transferred into your name.
You will be covered as of the time that you move in.
We have 24 -hour service on this thing.
In other words, we close the deal on Tuesday, you are covered as of Tuesday.
In a matter of days, the first homesteaders receive their deeds in a special ceremony at City Hall.
Armazelle Johnson is congratulated by the Mayor and by the Chicago area director of HUD, John Wehner, who worked with the U .R.
to get ownership of the homestead properties transferred from the federal government to the city.
Mrs.
McFarrey, 7413 South Kimbark, a teacher, selected a two -bedroom, one -story brick at 10336 South Vernon with an estimated rehabilitation cost of $4 ,936.
Move or say something.
Teacher.
I would just like to say thank you to everyone involved, and this is one of the happiest days of my life.
Off come the boards that have kept light and rocks from front windows, that have kept kids from running in back doors and dads from coming home through front doors.
It is time to open the homestead.
Now the hands -on work of homesteading is underway.
To begin with, the emergency repairs, the major work on electricity, plumbing, and heating, which calls for professional help.
The city is taking care of this emergency work now in order to get the houses occupied.
The homesteaders will pay the bill later out of their loan money.
The homesteaders must move in within 60 days after receiving a conditional deed to the property.
They must make all repairs necessary to meet the city's building code requirements within 18 months after moving in, and they must live in the house for three years, satisfying all homestead requirements before they get clear title to the home.
Ollie and Nancy O 'Neill expect to reach that goal.
He's a chemist.
Mrs.
O 'Neill is a secretary.
Together they make well over the average income of $13 ,958 a year for all homesteaders.
Theirs is a five -room house with $4 ,400 needed for repairs.
So the house will cost them $1 plus the loan with interest plus the time, effort, and materials they invest in doing part of the work themselves.
Through the spring and summer, the others take over their homesteads.
There are always complications in a new program like this, of course, but the conveying of title from HUD to city to homeowner is accomplished without serious delay.
Along the way, the homesteaders are learning what they need to know about loans and contracts, insurance, taxes and water bills, all their responsibilities as homeowners and particularly as homesteaders.
DUR personnel are always on hand to help, along with other city experts.
My name is Harold Tepper.
I'm with the city law department.
I'm an attorney at law.
There are a number of formalities in connection with a real estate deal.
Now you're at liberty to have your own attorney.
However, if you wish the city law department and myself to help you, we'll be glad to help you on anything that comes up in regard to any legal question in connection with the processing of this real estate deal.
You will find me at the city hall, room 610, phone number 744 -6971.
I shall be happy to cooperate with you.
If the contractor doesn't do work in a good workmanlike way and it's not satisfactory to you, he doesn't get paid.
We would like to have that contractor prove to you as well as to us that he can do the work for let's say $5 ,000.
Now if a contractor in this particular instance can come in with cost certified documents which shows that he can do the work for $5 ,000, we perhaps would consider it.
But based upon our experience, one of the biggest problems that we have in the program are that inexperienced, underfinanced contractors will win and lowball, to use a term, lowball a job and they don't get the job complete.
And all of a sudden we have a homeowner that has his property all torn up and we have a contractor that took off for the hills.
And the job isn't complete and there he is stuck.
We want to make sure that your job is going to be done and we also want to make sure that a contractor is going to make a profit.
And he's going to make a profit because if he doesn't, he's not going to do the job for you.
Well the counselor helped us very well in getting the right contractor, the right prices for the work to be done, what work was necessary to bring it up to city code and mostly everything in general.
You know, where I owned the home for the first time, they wouldn't, you know, where you wouldn't go wrong about, you know, trying to make your own decision, should I do this or do that, they trying to, they kind of put you on the right track.
To hold down costs, many homesteaders are doing the work themselves.
Like young Craig Martin, who at 22 is head of a household that includes his mother, sister, nieces and nephews.
Martin, who works for an oil company, was low man on the totem pole in the lottery and is going to take $15 ,000 to fix his house.
But Martin, like the others, figures he's going to make it.
George Stohm thinks they'll all make it as he checks in with the homesteaders at the halfway mark.
Well thanks Tom.
I know in the last couple of months, I think the last time I met with you was in early April at a similar meeting like this, at which point we had just gone through the lottery and a lot of other hoorah and no one really had gotten involved in homesteading.
And since that time you have gotten very involved in homesteading.
You've had regular meetings with Mr.
Marshall and other members of our staff, as I understand it, in some of your cases on practically a daily basis.
But you haven't seen me and I welcome the opportunity to get together with you again.
I have not been that far away from the program, however, and so I am well aware that in the last couple of months, all of you have learned that it's not only fun to get a house for a dollar, but you've got a very first -hand experience as to just how frustrating and aggravating owning a house can be.
One advantage I do have, however, since I am not involved on a daily basis about worrying why the damn plumber did not show up like he was supposed to or why Commonwealth Edison can't drop that power line so you can get in, is that I can see the progression that's happening.
Half of you, for better or worse, are in those homestead properties.
Almost all of you will be in there by the end of July.
And I want to assure you that, believe it or not, come fall, 99 % of the cases at least, that work will be done and the house will be the way you want it to be.
Now, if I were a homesteader, I would feel, I think, about this point in time, that I would be getting kind of sick and tired of seeing people from the Department of Urban Renewal.
And I would say, why don't those damn people get out of our hair and let us go about our business? And I admit that sometimes we seem kind of pedantic and bossy and are always asking you to come to meetings and pay attention to this program and so forth.
But when your houses do get fixed up, and they will, then we really get to the problem of keeping you there because this is a three -year operation.
And I want to assure you that for myself and for my staff and the people in model cities who are now going to be working with us, all of us in city government think that homesteading is a very, very important program.
And you are the most important aspect of that program because we don't want to stop with 44 buildings.
We want to do hundreds and hundreds of buildings.
And we have got to convince the federal government that this is a program that can succeed, will succeed, and should continue.
And I guess the only way to put it is, as far as we're concerned, at the risk of annoying you and badgering you and being too much in your business, we came into this program with 44 homesteading families.
And three years from now, we are going to go out of this program with 44 homestead families, and by God, it's going to be the same 44 homestead families.
And I'm looking forward to it because...
By fall, all the new neighbors were in their homesteads, in the case of Mr.
and Mrs.
Ed Morgan and Mrs.
Pauline Hardeman right next door to each other, where there had been two abandoned homes before.
...
ready playmates for my children, even though they are older.
...
apples and one Jonathan apple.
Leo Monroe, a five -year resident of Central Austin, welcomed homesteaders David and Susan Humphrey as his new neighbors, and found a common interest in many things, including backyard gardening, home improvement, a better community.
Our number one lottery winner, Armazelle Johnson, is happily settled in.
Her son Darryl is no longer crowded in with his cousins.
He has a room of his own.
A yard to play in, room for a dog, and he has a mother thoroughly pleased with it all.
It's more working to own a home than an apartment, but I enjoy it, and I'm really happy about it, and I wouldn't exchange it for anything.
We think at this time that the Homestead program in Chicago is going very well.
We're delighted with the response that we've received from our homesteaders.
None of them have shown any inclination that they're going to do anything but stick it out and make a success of the program.
We started with the idea that the demonstration program from homesteading in Chicago would be a success.
We're confident now that it in fact will be.
I hope that we will demonstrate with 44 houses in Chicago what can be done, and what will be done, and what should be done, with cooperation of all governments, the federal, the city, and above all the people, to put all these buildings in every neighborhood back in shape to make a decent home for a decent family in every neighborhood in Chicago.
Well, it feels pretty good to come home.
You know that you have a stable base, sort of like your roots are set down, and you have something to work for and work towards the future with.
It's a place where you know this is yours.
It's a lot of fun to have neighbors that you know instead of neighbors that you pass because there's so many people living in the building, nobody really knows anybody.
It's nice to have your kids make friends, real friends that will be there, you know, the next 15 years they won't be moving away.
It's about the best thing that could happen to anyone to own their own home.
It's really nice.
