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MICHIGAN
A Plan to Reduce Urban Blight
Homes in Detroit are being auctioned off for as low as $1,000,
with a catch: the new owners must renovate the homes into livable
conditions within six months, Business Insider reports. e
program, from the Detroit Land Bank Authority (DLBA), intends
to restore many of the run-downed homes in the city to a usable
state.
Bidders can make offers through the DLBA online platform,
Auction. According to Alyssa Strickland, the DLBA's public
information officer, the goal of the program is to encourage
residents who are currently renting to invest in the community
by becoming homeowners, and has sold 3,304 homes since the
program's inception in 2014.
"It's important to us that we aren't selling to real-estate
speculators," Strickland said on Business Insider. "Our programs
are designed to be for people who want to be primary residents."
After six months of ownership, a compliance officer will deem
whether or not the home is livable, and if it is, complete ownership
will be transferred to the winning bidder.
Other programs in Detroit, such as the Detroit Home Mortgage
program (DMH), are also seeking to improve homeownership rates
in the city. e DMH is working to increase homeownership by
lending qualified buyers the money needed to both purchase and
renovate homes. DMH borrowers can receive two loans: For the
appraised value of the home and for the gap between the home's
sale price and its appraised value, while also covering the cost of
renovations.
Despite the assistance of programs like the DMH and the
DLBA's Auction, Detroit is still facing a foreclosure crisis.
According to GOBankingRates and data from Zillow, 34.4% of
homes in the city are currently underwater, and the median home
value at the Detroit-Warren-Dearborn metro-area level is $161,300,
far below the national median of $226,300. GOBankingRates puts
Detroit second on its list of U.S. cities most likely to enter a housing
crisis.
