The City of Detroit has established a $250 million multifamily affordable housing fund to preserve 10,000 affordable housing units and build 2,000 more.
Called the Affordable Housing Leverage Fund, it will be comprised of $50 million in grant funds, $150 million of low-interest borrowing, and $50 million in public funds from expected federal and city funds for affordable housing over the next five years.
The first goal is to preserve 10,000 existing affordable housing units through the expansion of initiatives that already have helped to preserve 1,772 units of affordable housing across the city since 2015. That, the city says, will maintain the affordability of an existing unit over time and is essential to retaining Detroit’s existing population and ensuring future affordable housing options for all Detroiters.
The targeted affordable units for preservation are at risk because of expiring low-income housing tax credits and deteriorating conditions, especially in neighborhoods that have seen improved market conditions.
Here’s how it works.
The plan will engage owners of regulated and “naturally occurring affordable housing” to make sure they are ready to extend their affordability requirements and rehabilitate and extend the life of their existing affordable housing. The city will also prioritize and target the approximately 3,500 most at-risk units for investment. In order to preserve them the city will seek a preservation community development financial institution (CDFI) partner with HRD and create the pipeline of preservation units.
“The preservation and creation of affordable housing is the cornerstone of our growth strategy,” says Mayor Mike Duggan. “Affordable housing offers stability for the city’s low-income residents and provides options to households at a range of incomes in all neighborhoods. This is what we are talking about when we say that we are building one city for all of us.”
To build the affordable housing units the city will continue and expand initiatives that helped develop 852 units of new affordable housing since 2015. The Housing and Revitalization Department will work with the Planning and Development Department to identify vacant city-owned parcels and existing buildings for rehab in the designated neighborhood planning areas, as well as preservation targets within those neighborhood planning areas for redevelopment.
Duggan has charged the Housing & Revitalization Department and city partners like the Detroit Housing Commission with implementing the plan, starting with the creation of the Office of Policy Development and Implementation.
“We have had a chance to observe and speak with leaders from Washington, D. C., Chicago, and San Francisco and learned how they have had to make major investments in affordable housing after the real estate market grew and missed some opportunities to include affordability in the their revitalization,” says Arthur Jemison, who is Detroit’s Director of Housing & Revitalization. “With a strategy and fund of this kind, we hope to learn from their efforts and invest in affordable housing now.”
Compete details of the city’s Multifamily Affordable Housing Strategy can be found by clicking here.
City of Detroit creates $250 million fund to preserve affordable housing, add more added by TheHUB on
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