Fixing The Foreclosure Crisis

Although residential mortgage foreclosures have wreaked havoc on many communities in metro Detroit and Michigan, efforts to stem the damage and boost property values are under way. But do the relief programs go far enough?


Published:

(page 3 of 7)

On a related front, a pilot program coordinated by the Michigan Association of Realtors had sales pending or had closed on 94 of 100 previously foreclosed or abandoned homes that had been renovated in Wayne, Oakland, and Macomb counties (as of August).

Participating communities included Eastpointe, Ecorse, Ferndale, Hazel Park, Holly, Inkster, Keego Harbor, Lake Orion, Oak Park, Ortonville, Pontiac, Redford Township, River Rouge, Royal Oak Township, and Westland. The coalition contracted with Home Renewal Systems Inc. in Farmington Hills to either demolish, build, or refurbish the properties and then market and partner with local real estate agents to sell the homes.

“Our idea was that if we could support our struggling communities dealing with the devastating effects of foreclosures, we could also support the home values within those communities,” says Shannon Morgan, vice president of Home Renewal Systems. Tracey Katzen, daughter of longtime homebuilder Bernie Glieberman, started the effort in 2008. “This program addresses the blight of having unoccupied and deteriorating homes that lower home values and tax revenue, and would otherwise be the subject of speculative sales that turn into rentals, which can further hurt a community,” Morgan says.

In communities such as Detroit, Inkster, and Pontiac, hundreds of formerly foreclosed homes have been purchased at rock-bottom prices and turned into rental properties.

“With rentals you generally have minimal investment into the rehabilitation, (and) tenants often don’t take the time and effort that a homeowner would in contributing to the community,” Morgan adds.

SEMCOG’s Vettraino agrees. “In general, renters don’t have the same stake as a homeowner, the properties are not maintained as well, and the values are lower,” he says. “The problem is that many communities were designed for single-family, owner-occupied neighborhoods.”  

Edit Module
Edit Module Edit Module
Edit ModuleShow Tags

Related Articles

30 in Their Thirties 2015

The 2015 class of 30 in Their Thirties offers products and services from Michigan that span the world, from the latest fashions to data enterprises to wholesale mortgage lending to luxury shopping malls.

Next Generation

General Motors and Ford Motor Co. are investing millions of dollars to upgrade their historic technical and research centers in a bid to better compete for talent with Google, Apple, Uber, and others.

Mad Dog

Following 40 years at Compuware Corp., Peter Karmanos Jr. — with a group of 25 technologists — is out to revolutionize the $700-billion commercial automations systems industry.

Robbing Peter to Pay Paul

During the last two years of Peter Karmanos Jr.’s tenure as chairman of Compuware Corp., a Shakespearian-type drama unfolded that led the board to fire him and cancel more than $4.1 million in vested stock options.

Hyper Speed

The inside story of how a trio of young entrepreneurs convinced billionaire Dan Gilbert to back high-speed Internet service in Detroit — and beyond.
Edit ModuleShow Tags

Most Popular

  1. Hepta Control Systems Earns Integrator of the Year Award
  2. Extreme Cold Therapy Center to Expand to Royal Oak, Detroit
    Cryospa Detroit, a Bloomfield Township-based company that offers a type of therapy treatment...
  3. Rochester Hills Unveils Plans for Ice-skating Pond, Canoe Launch at Riverbend Park
    After raising more than $1 million in private funds, the City of Rochester Hills today unveiled...
  4. Physician Donates $2M to Beaumont Health to Honor Family, Colleague
  5. Livonia’s ZF TRW to Open Electronics Division Headquarters in Farmington Hills
    Livonia-based ZF TRW, a supplier of safety electronics products, will open a new...
  6. Ford Earns $7.4B in 2015, Hourly Workers to Receive $9,300 Bonus Checks
    Ford Motor Co. said today it generated net income of $7.4 billion in 2015, up from $6.1 billion...