Micro Market Recovery Program

Chicago

Cook County

The Micro Market Recovery Program in Chicago targets small, high-need neighborhoods with coordinated public, nonprofit, and private interventions to stabilize housing, re-occupy vacant properties, support homeowners, and attract private investment.

Background

The Micro Market Recovery program (MMRP) started in 2011 as a response to the vacancy challenges that Chicago faced in the wake of the foreclosure crisis. A survey of conditions throughout Chicago revealed stark discrepancies in housing distress from neighborhood to neighborhood; where some communities were scarcely affected by foreclosures and others required significant intervention to stabilize the local housing market. To address the neighborhoods that were hardest hit, the MMRP was developed in a coordinated effort between the City, not-for-profit intermediaries, and capital sources. Recognizing that concentrated reinvestment was needed in concentrated areas of the city, the MMRP sought to initiate positive economic change in distressed communities by concentrating resources in the most distressed blocks of those communities. In some target areas, there were hundreds of vacant buildings within just a few block radius. The MMRP aimed to turn those abandoned properties into affordable homes, connect existing homeowners with resources to help them stay in their homes, and ultimately stabilize and attract private investment back to these distressed areas.

How It Works

The Micro Market Recovery Program is based on three principles: strategic targeting of resources to small geographies, collaborative deployment of those resources by private, public and non-profits partners, and comprehensively utilizing those resources to address the specific needs of families, buildings, and blocks. In 11 hyper-focused and carefully chosen target areas, community partner organizations work with the Local Initiative Support Corporation of Chicago (LISC) to inventory vacant and foreclosed properties and facilitate their reinvestment, identify owners of troubled properties, connect existing homeowners to critical resources, and increase opportunities for new affordable homeownership.

In practice, the City’s Planning, Building, and Law Departments meet regularly to prioritize and track progress on interventions while the community partner organizations work with existing homeowners to deploy financing and rehab tools. In addition to foreclosure counseling, homeowner counseling, energy efficiency grants, and forgivable home repair loans, another significant resource currently offered by the MMRP is the Purchase Assistance Grant, which provides $30,000 in down-payment assistance to households with incomes up to 120% of the area median income (AMI) when purchasing a primary residence in one of the MMRP target areas.

Goal

To stabilize and rebuild distressed Chicago communities through targeted reinvestment in small geographic areas; re-occupy vacant buildings; reduce the cost of homeownership; support existing homeowners; and create environments supportive of private investment.

Target

The MMRP currently has 11 designated target areas – typically several blocks in size – in 11 Chicago neighborhoods, including: Auburn Gresham, Austin, Chatham, Chicago Lawn, Englewood, Hermosa, Back of the Yards, South Shore, West Garfield Park, West Humboldt Park, and West Pullman.

Financing

The MMRP is funded primarily by the City of Chicago, averaging roughly $2.3 million per year, and often leverages private and/or philanthropic funding, including $3 million in 2018 from the Illinois Attorney General foreclosure settlement funds.

Success

An analysis by the Depaul Institute for Housing Studies found that sales for single-family homes in MMRP areas increased at far higher levels than the citywide average, and sales of small multifamily buildings increased in seven MMRP areas.

In addition to the general success in stabilizing neighborhoods – resulting in reduced crime, improved schools, and increased community involvement – the following numbers demonstrate the material success of the program:

  • More than 1,000 vacant buildings and 3,000 units of housing re-occupied
  • Foreclosure filings decreased by double digits in MMRP areas within the first five years.
  • More than 400 families provided with home financing and rehabilitation assistance.

Lessons Learned

Targeted intervention in small geographic areas allows stabilization that can then be expanded to surrounding areas.

Working with local partner organizations that have neighborhood credibility is critical to establish trust of the MMRP and determine appropriate and effective interventions for each area. Local partners can be different types of institutions, but must have existing neighborhood relationships, knowledge, and ability to proactively engage directly with residents and homeowners.

Municipalities should establish a coordinated system of communication when multiple departments are considered stakeholders in a project. Operating in isolation is more resource-intensive and less effective.

Contact Information

City of Chicago Department of Housing, www.chicago.gov

This case study was last updated in February 2026.

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