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  • Two-thirds of poor households in Detroit have annual income below $20,000
  • Developers might have little incentive to target the neediest households
  • City is creating $250 million fund to maintain affordable units set to expire

Detroit’s lack of affordable housing could become much worse in the next few years, and those most in need are likely to suffer the worst.

That’s according to a new report from the Michigan League for Public Policy, a Lansing-based nonprofit focused on promoting racial equity and fighting poverty.

While the median household income in Detroit — $27,838 per year — paces at half that of the state, the average rental price in Detroit increased 26 percent from 2005 to 2016 (from $650 to $820 per month) and keeps going up, the report said. Most Detroit households are renters and the median housing costs about 48 percent of median income.

Housing is considered affordable when it consumes no more than 30 percent of household income.

Worsening matters, of the city’s 22,000 affordable housing units, the affordable status on 10,000 of them is set to expire by 2023 when low-income housing tax credits run out. The city is creating a $250 million fund in hopes of preserving the status of these homes and creating another 2,000.

Still, the report suggests the city’s plan to build more affordable housing falls short and may leave the neediest families without support. The city approved in 2017 an ordinance that requires developers to make 20 percent of a development “affordable” if the project receives a discount on city-owned land or at least $500,000 in subsidies from the city.

However, the ordinance calls for the affordable units to be priced for households making 80 percent of the area median income ($45,135 in Wayne County), which is substantially higher than the city’s AMI. The report contends that developers might have little incentive to target the poorest residents, while about two-thirds of cost-burdened households in Detroit have an annual income below $20,000.

Poor residents are more likely to be mistreated by landlords, live in unsafe conditions and be targeted with water shut-offs. In 2017, nearly half of the mortgages issued in Detroit went to white people, which make up just 10 percent of the city’s population, according to the report.

The report calls for the following actions to protect residents:

  • Focus more affordable housing efforts on the households with the very lowest incomes.
  • Strengthen the community benefits ordinance to ensure that the Detroit residents subsidizing developers benefit from the ensuing economic development.
  • Establish water shut-off protections and income-based bills for households with low incomes to protect their health and help stabilize their housing situation.
  • Provide for eviction expungement so struggling families or those wronged by unethical landlords aren’t indefinitely blacklisted from rental housing.
  • Strengthen consumer protections in land contracts to ensure unscrupulous sellers can’t cheat buyers out of the return on their investment.




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