The uptick in Detroit’s downtown and neighborhood property values is good news to many, but not for all. With rental rates rising and less property available in prime locations, it’s becoming increasingly difficult for millenials, seniors and low-income families to afford to live in the desirable neighborhoods they would like to call home.

The cost of city homes is quickly becoming prohibitive to these cash-strapped residents, many of whom struggle to dig their way out of college debt, long periods of unemployment and poverty while trying to keep a roof over their head.

The news that nearly 400 families and individuals in several Detroit neighborhoods, including Brush Park, Midtown, Oakman Boulevard Community and Core City neighborhoods, is welcome and serves as comforting affirmation that Mayor Duggan is inching closer yet toward making good on his promise to create a “city for everyone.”

Four major housing developments in those neighborhoods have been selected by the Michigan State Housing Development Authority (MSHDA) for high-impact tax credits that will allow developers to provide affordable housing units for hundreds of Detroit families.

The four developments, which represent a combined investment of $110 million, are receiving $4.4 million in tax credits from MSHDA.

In total, 271 units of existing affordable housing that were set to expire soon will be renovated and will keep their affordable status for another 30 years.  Another 114 new affordable units, nearly half of which will be for families earning less than 30 percent of the area’s average Median Income (AMI), will be built.

These major housing will receive a limited number of 9 percent low-income housing tax credits (LIHTC) that will help create or preserve 385 units of affordable housing across the city, according to Mayor Mike Duggan.

“What makes this so important is that we will be able to guarantee that 271 existing affordable housing units will keep their status for another 30 years,” says Duggan, who had promised Detroit will be a city for everyone. “That represents 271 families that know they will be able to afford to stay in their homes and take part in the recovery they have waited so long to see.”

The four developments are:

• Roberts III – All 197 units in this building will be preserved as affordable housing for the next 30 years for the senior citizens who occupy this complex.  Incomes at this complex range from 60 percent of AMI to less than 30 percent AMI.  The project has support from the Detroit Housing Commission in the form of project based vouchers to support lower income units.  Total project cost: $16.4 million
• Ryan Court II – All 74 units will be preserved as affordable housing. Incomes at this complex also range from 60 percent of AMI to less than 30 percent AMI. The development, which spans several blocks near Oakman and Livernois, is a mix of new construction and rehabilitation of older buildings. Ryan Court Phase 1 is one of only a few projects nationally to preserve existing affordable housing units through new construction with an additional investment of $16 million. Total projectcost: $9 million(phase 2 only).
• Peterboro – Renovations proposed at the property will result in 56 units (42 two-bedroom units and 14 three-bedroom units) of Permanent Supportive Housing that will be targeted to homeless families who meet MSHDA’s criteria for Permanent Supportive Housing. In order to assist the families that will reside at the building, COTS will be requesting 38 project-based vouchers from MSHDA and has received conditional awards for 9 project based vouchers from the Detroit Housing Commission and project rental assistance for nine units through the HUD Section 811 program. Total project cost: $14.5 million.
• Brush Park South – 58 (20 percent) of the 287 units in this new mixed-income construction development will be reserved for residents earning 60 percent AMI or less.  This project, which will revitalize 19 vacant city-owned parcels, is being supported by $2.3 million in HOME funds.  The project also has support from the Detroit Housing Commission in the form of project based vouchers to support lower income units. Total project cost:$70 million (estimated).

To begin the projects developers working with the City’s Department of Housing & Revitalization applied for and were awarded a series of 9 percent LIHTCs.

The 9 percent LIHTC award is the most valuable and competitive affordable housing tool in the country, because it leverages up to 90 percent in equity to build affordable housing units.  It also gives developers the ability to serve families and individuals who are at the lower end of the economic spectrum (below 30 percent AMI), including those who have experienced homelessness.

Collectively, these awards to the city of Detroit represent approximately 40 percent of the total available 9 percent LIHTCs statewide in this round of applications.

“After many months of work to shape a project pipeline with MSHDA that reflects both state and city investment priorities, this set of project awards is real progress,” says Director of Housing & Revitalization Arthur Jemison. “It includes projects in our target areas for residential density; creates mixed-income in downtown midtown; addresses family homelessness, and preserves key assets threatened with expiration and obsolescence.”

Not only will these new affordable developments provide nearly 400 families and individuals with a decent place to live, the program may dramatically change the future of many.

Some studies have shown homeownershiprelieves stress on adults and benefits children. Kids are more likely to do well in school, less likely to have behavior problems and less likely to become pregnant as teenagers.

These are all pluses for Detroit’s ongoing recovery.

Lead photo by Michelle & Chris Gerard

  affordable housing in Detroit, Brush Park South, City of Detroit, Detroit Dept. of Housing & Revitalization, Low income housing tax credits, Mayor Duggan, MSDHA, Peterboro, Ryan Court II