In the early 1990s, Ted Knights lived in the Gaslight Village, an artisan community  on Brown Street in historic northside Iowa City.

“If you’d told me then I would be living in a house a block away from it, I would’ve been like ‘yeah, right,’” Knights said.

But he does, despite relative difficulty finding affordable housing near or in downtown Iowa City. The mix of people living in that part of this city that houses University of Iowa students from across Iowa and other states but also local residents, is out of balance, housing and urban planning experts say.

It’s that way in large part because of, paradoxically, students who can afford housing there sharing rents with others, making the rental property valuable and squeezing out potential homebuyers and single-family renters.

Four University of Iowa students sharing an apartment can end up having more buying power than one family entering the housing market. “So these four students can outbid a young couple for a rental house or apartment in the locations close to downtown,” Jerry Anthony, associate professor in the University of Iowa School of Urban and Regional Development, said.

The median sales price for all homes in the Iowa City area market was $202,950 in November, the Iowa City Area Association of REALTORS reported to the state Iowa Association of REALTORS. That’s the highest in the state, ahead of $189,000 in the Des Moines area. The state median was $153,250, the state association reported.

But, the student rental effect on Iowa City housing comes more from the available housing that fits into a family’s or young professional’s income than it does on price, Anthony said.

Johnson County, where Iowa City is located, has the highest rate in the state of people who are housing cost burdened, Anthony said.  To understand what he means: households that pay more than 30 percent of their gross income on housing costs, including utility expenses, are considered to be housing cost burdened.

Using the most accurate numbers available from 2010 census data, Anthony said one of three Johnson County households, or 34.7 percent of both renters and homeowners, were considered housing cost burdened. The rest of the state’s rate is one of four households – 25.5 percent.

Story County, where Ames and Iowa State University are located, has Iowa’s second highest housing cost burden rate. The median sale prices of homes in the Central Iowa area that includes Ames was $170,000 in November, the Central Iowa Board of REALTORS reported, although that median includes rural nearby counties with less expensive property than in Ames.

The amount of available affordable housing is a larger concern than a lack of income or jobs, Anthony said. The problem especially is apparent in young families or households with a stay-at-home parent or young professionals such as teachers.

Jen and Ted Knights at their Iowa City home on Nov. 11, 2017. Credit: Lauren Wade/IowaWatch

Previously in horticulture, Knights recently switched careers to carpentry.

His wife, Jen Knights, who works as a nonprofit fundraiser for the Iowa Brain Injury Alliance, said even as a student at the University of Iowa she knew she wanted to live in Iowa City. After moving to Chicago briefly, the couple returned to Iowa City and bought a house on the south side of town, where they lived for 10 years.

“We kept getting in the car to go downtown and do stuff, like go to the library, go to the Englert, you know,” Jen said, referring to the Englert Theatre among those downtown locations. “We kept coming to the downtown all the time.”

Jen Knights and her daughter Mae, 10, and son Arlo, 13, bake cookies at their Iowa City home on Dec. 17, 2017. Credit: Lauren Wade/IowaWatch

Ted and Jen began looking to move closer to downtown Iowa City, but every house within their price range, Jen said, was barely within their budget, needed far too much work and was not livable for their family of four.

They purchased their home on North Gilbert Street through a program in Iowa City called the UniverCity Neighborhood Partnership for $218,000 and it’s been a dream come true, Jen said.

The UniverCity Neighborhood Partnership buys houses in neighborhoods where more than 50 percent of the housing is rental. The program repairs houses and sells them below market value to income qualifying families or individuals.

The program has sold homes to a wide range of people, Lucy Joseph, an enforcement specialist with the city, said. They include teachers, people employed by the University of Iowa, people moving to Iowa City for the first time or people who’ve rented but are looking to buy. The program is especially popular with young families and first-time homebuyers.


Houses purchased by the UniverCity Neighborhood Partnership include rentals from private landlords looking to downsize and homes from families in Chicago who bought a house so one or more of their children could live there while a college student.

“Neighbors will see their neighbors’ house going for sale; they’ll contact us before the house even goes on the market,” Joseph, who also works part-time with the University Neighborhood Partnership, said.

The city partners with local banks to buy the houses and places a second mortgage on the house for $50,000. That money goes to repairs such as updating kitchens, bathrooms, roofs, flooring, electricity and plumbing. In some instances, the houses are converted from multiple apartments back to single-family homes.

The city then sells the house, and the program places a deed restriction requiring that the home be owner-occupied for 20 years, David Powers, a housing inspector with the city, said. If the family who originally bought the UniverCity program house lives in it for five years, the city forgives the $50,000 second mortgage for repairs.

An individual or family’s income must fall below 40 percent of the median income to qualify to buy a UniverCity home, Powers said, but the program also will take into consideration factors such as student loan debt or medical expenses.

The houses sell anywhere from $100,000 to $235,000, depending on the neighborhood. The sweet spot for what families falling within the income guideline can afford tends to be around $200,000, Joseph said.

The Iowa City budget calls for spending $510,000 to acquire UniverCity program houses for the fiscal 2018, down 43 percent from fiscal 2017. The budget for repairs is $150,000, down 55 percent from last year.

­“We’re a year-to-year thing,” Powers said. “We’re in the budget every year, so, they funded us this year. Next year, maybe they don’t. It’s hard to say.”

Live in Iowa City and interested in a UniverCity Neighborhood Partnership house? Follow its Facebook page for updates and homes available.

The program originated in 2010, when Iowa City applied for a $1 million grant through former Gov. Chet Culver’s I-Jobs program, which pumped state money into local communities for work projects. The city used the money to buy 20 houses near downtown, repair them and sell them back at below market value to income qualifying families or individuals.

“The (UniverCity) program started off with a bang,” Powers said. “At that point, we were still kind of in the recession.”

UniverCity Neighborhood Partnership received an additional $250,000 for six more houses, bringing the total to 26. Since then, the program has completed four to 18 homes a year. With the current staff and funding, Powers said, the program aims for about five a year.

Joseph said, “We’re getting ready to sell number 59 soon.”

But Anthony said programs like the UniverCity Neighborhood Partnership are not fixing the housing problem because students previously renting get displaced and find another house to occupy.

Both the university and Iowa City are conducting private studies of student housing needs. Also, a progressive bloc was elected to the City Council in 2016 and began making policy changes to encourage affordable housing development, Anthony said.

Developers have seen an opportunity in and near downtown Iowa City for boutique apartments that students can rent for as much as $979 per person monthly. A market exists for them even with relatively high rent, Anthony said. Moving top-end paying students into housing like this will make more options available at more affordable prices, he said.

“But a lot more steps have to be taken, and that momentum has to be carried for a very long time before we see any tangible difference in the reasonableness of the process here,” Anthony said.


Thomas Agran and Allie Gnade bought the second house sold through the UniverCity program and have lived there for six years.

“I think it’s really protecting one of the big assets of the city, which is neighborhoods with character,” Gnade, who grew up just outside of Iowa City and works for New Pioneer Co-op, said.

Agran, an artist and recently appointed as the director of public art for Downtown Iowa City, said both he and Gnade love and appreciate Iowa City’s historic homes.

The front porch of Ted and Jen Knights’ Iowa City home on Nov. 11, 2017. Credit: Lauren Wade/IowaWatch
The front porch of Ted and Jen Knights’ Iowa City home on Nov. 11, 2017. Credit: Lauren Wade/IowaWatch

He said their house’s location is ideal for walking. They are only a few blocks away from businesses such as a sandwich shop, a hardware store and a grocery store.

Meanwhile, the Knight family is approaching in February the three-year anniversary of living in their home.

“I like the idea of other students, understanding that there are ways for them to be here permanently too, and the city is interested in keeping families here.” Jen Knights said. “They’ve been really good the last few years about nurturing that downtown and surrounding neighborhoods and making sure that they’re a great place to be.”

“We’re not leaving,” Ted added.


This IowaWatch story was republished by the Iowa City Press-Citizen, The Hawk Eye (Burlington, IA) and The Gazette (Cedar Rapids, IA) under IowaWatch’s mission of sharing stories with media partners. 

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