When Brian Reichow started looking to buy his first home last year, he started house-hunting in familiar areas.
"I had been out looking at homes in the suburbs, which is really all I ever knew," Reichow said. "I've spent 35 years living in the suburbs: Roseville, Mendota Heights, Plymouth, so on."
But in the 'burbs, Reichow wasn't finding homes with the kind of character and quality he wanted. He said most of the houses he saw were properties nobody really wanted. Then, Reichow said he saw a newspaper article about the Minneapolis Advantage. The pilot program was offering 50 loans of $10,000 each. Reichow said he figured there'd be a mad dash for the money.
"Particularly since the requirements for the program were minimal, at best," Reichow said. "There weren't any income requirements; you simply had to find a house that was on a block with a boarded or foreclosed home, which is not difficult in north Minneapolis."
Reichow qualified for the program and bought a four bedroom, two bathroom house in the Homewood neighborhood of north Minneapolis. He said the neighborhood is quiet and his neighbors are racially diverse and most are professionals. There is one boarded home at the end of the block, and unlike many other blocks on the northside, there are no 'for sale' signs.
Forty-nine of the first 50 loans in the Minneapolis Advantage program have been completed. More than half of the new homeowners are, like Brian Reichow, white. Nearly 20 percent identify as Asian and about 13 percent are African American. City officials say those numbers roughly parallel the racial demographics of the city.
But that doesn't mirror the demographics of north Minneapolis. The northside has a higher concentration of African Americans than the city as a whole.
Lennie Chism is a longtime northside resident and the director of a non-profit development company. Chism said he doesn't disagree with the goal of getting homeowners back to the northside, but he doesn't like how the program is being presented to the public.
"Are you marketing it to the residents who left north Minneapolis as a result of foreclosure and figuring out a way to bring those residents back?" Chism said. "These were people that took stake in north Minneapolis. Now you're taking a program, you're marketing it well, 'city living.' Come live in the city. Come from the suburbs and live in the city."
According to data gathered by the city, nearly a third of program participants moved from the suburbs to north Minneapolis and another third moved from other parts of Minneapolis into an eligible area of the northside. The rest moved to eligible areas of south Minneapolis.
But even if every one of the participants in the Minneapolis Advantage was white and middle class, some say that would make very little change in the demographics of north Minneapolis.
"I think the northside is so profoundly segregated now. It's going to be hard for a single program to make much difference," said Myron Orfield, executive director of the Institute on Race & Poverty at the University of Minnesota.
Orfield said, historically, racially segregated and lower income communities in the U.S. suffer from a host of maladies including underperforming schools and a disproportionate lack of municipal services. Orfield said even if the changes are slight, there may be a hidden advantage to the Minneapolis Advantage.
"In the long term, racially integrated neighborhoods are much less likely to experience profound, systemic, multi-level discrimination. So if neighborhoods are integrated, if it does become more integrated on the northside, there will probably be more investment and banks will discriminate against them less."
City officials said they believe north Minneapolis will remain a place where low-income people of color can afford to own a home.
For the next round of 150 Advantage loans, homebuyers must be at or below 80 percent of the area median income, and they must buy a foreclosed home. And while they will still have to qualify for a prime interest rate loan, given the low house prices in the targeted neighborhoods, city officials say most new homeowners will likely wind up with mortgage payments of around $500 a month.