Editorial: Affordable housing plan good for Detroit
As Detroit’s revitalization continues, it’s critical to support Detroiters who’ve stayed despite the challenging economic times. The city’s comeback will ultimately mean little if it doesn’t regrow the economy while also boosting the quality of life for lower-income residents who have struggled for decades.
To that end, Mayor Mike Duggan’s plan to launch the Affordable Housing Leverage Fund to preserve and create affordable housing is necessary, although the city should ensure that housing developers can still make a profit off their investments. The administration plans to essentially extend tax credits that will soon expire in current subsidized units, which should be an effective way to target the residents who have remained in Detroit, but felt ostracized in the city’s rebirth.
The fund will include $50 million in grant funds, $150 million in low-interest borrowing and $50 million in public money that will likely come from federal and city funding set aside for affordable housing, or from philanthropic organizations.
The money will go toward about 10,000 units across the city whose federal housing subsidies will expire in the next five years. The plan also calls to prioritize 3,500 units that are most at-risk.
“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,” Duggan said.
Detroit needs more mixed-income neighborhoods. The boom of downtown and Midtown has created additional residential opportunities for new residents, but it has also forced up rental prices to a point that some lifelong residents have been pushed out. Lower-income senior citizens have been particularly affected by price increases in areas that have been most redeveloped.
From 2005 to 2016, rents have increased by more than 37 percent in the downtown district — to $1,020 per month from about $746 on average per month. Citywide rents have increased 26 percent.
This plan will build on initiatives that already help develop new affordable housing. The City Council last year passed an ordinance to require housing developers who receive certain public subsidies to reserve 20 percent of their units for lower-income residents.
The schism of two Detroits — one for newcomers and one for lower-income residents who’ve always been there — must end for the city’s comeback to be meaningful.
Creating more affordable housing is a step in that direction.