As some of you know, I've wanted to live in Detroit since at least 2008 or so. Before the first emergency financial manager took over the school district. Before the Grand Bargain. Before Midtown was at 100% occupancy. Before EAA. Before they revitalized the River Walk. (Yes, before it was cool. So hipster.)
We tried, in fact, to move to the city in 2012 when Rebecca started her medical school clerkship at Henry Ford Wyandotte. The money just didn't come together. We hadn't factored in the cost of car insurance, we hadn't realized how much rents had risen by then. We ended up in Wyandotte.
The current #househuntersdetroit story picks up this past spring, when I went to a Land Bank Open House with a friend. I wanted to see the inside of a very grand Boston Edison home, and this was my chance. We weren't planning to buy a home. Rebecca wasn't even with me - she was working that day.
After my friend and I looked at the featured home at the open house, we checked out a couple more. And I fell in love with one. It wasn't as big. It wasn't as grand. But it was full of light, and color, and architectural details, and the day was sunny and the neighborhood was brimming with joy, and I could see us there. I could see us in that house. So I got more information about purchasing from the land bank.
I'd heard about the land bank before. It's where the urban legend of the "$500 house" in Detroit originated, I think. Without getting into too much detail, the programs shift a little through the years, but for this one, the homes were tax foreclosures and that sort of thing. They were auctioned off, and then the new owner had a certain amount of time to bring them to an occupable state. If they're not finished in that amount of time, the land bank can take the house back. Because of that condition, traditional financing is very difficult.
So I visited two different credit unions with the address of this house and some land bank information sheets in hand. I read up a lot and asked a lot of questions. And despite assurances from the land bank that they're looking for owner-occupied dwellings, regular people, neighborhood stabilization, what I found out made me convinced that this is enabling a land grab. We couldn't get financing through any reputable financial institution. Without cash up front, and a lot of it (we were almost certain, based on past auctions, that the house would go for $20,000 or more, not the $1000 they usually start at), it would have been impossible for us to win the house at auction. And then even if we had that amount, we would still have to find cash to renovate, usually significant renovations, hard to tell exactly since there was no way to get an inspector in before we bid. I tried. I asked. No way.
I'm not saying that we deserved this house or belonged in that neighborhood. I'm not pitching a hissy fit about privilege and crying that I wanted something and didn't get it. After all, we're on schedule to close on an amazing home in a neighborhood we absolutely love and doing it with a financial institution we trust. We are incredibly blessed to be financially stable enough to be approved for this mortgage, to have had the privileges that have lead to our solid credit scores, to know that we can stay in the Detroit area for employment for long enough to make buying a house worth it. We are not the ones harmed by these policies, not really.
But if we couldn't buy a house from the land bank, if we couldn't get financing given the privileges I just mentioned, if we couldn't be sure we would fix it up in time, how could the people who have less than we do? How could people barely eking out a living despite working multiple jobs? I don't watch Rehab Addict much (I think I've seen two episodes - people ask me all the time if I love Nicole Curtis. She's doing good work, but it's not really my thing), but I know one thing she will say is that every square foot of renovation comes out to about $1000. Some of these houses could cost hundreds of thousands to renovate or restore. We found a house we liked down the street from the one that we're purchasing now that needed every square foot gutted and renovated. I looked at a fire-damaged house in University that was similar. In some cases, you can't renovate them for what they're valued at, even if the house were signed over for free. The average Detroiter that needs a house can't come up with that kind of money.
You know who can?
Foreign investors. Slum lords. People with the ability to endlessly create new LLCs. These people also have an advantage in negotiating with the tax office to avoid the foreclosures that put the property back into the land bank.
That house I fell in love with, that sunny day? I watched its auction, and it sold for more than $80,000. I've driven past it a few times as we've searched. A couple times, I've seen people working on it. I wish them well. I wish Boston Edison well.
But the costs of a $500 or $1000 house are higher than many think. It's not a quick fix for the poor or the homeless. There's a lot of liability in those kinds of houses. I'm not saying that I would never do it. But by the time we're able to, we would no longer be the kind of owner the land bank claims this program is for. We would be able to buy a second home, or an investment property, or a rental property. And while I wouldn't do what the owners of the last house and our current house are doing - neglect the property (and neighborhood) until it's time to make money and then try to cover up the issues to sell high - we probably could do so legally if we tried a little. I hated seeing foreign investors gamble on the University District, on a house that is just right for a family. I hated seeing the game they were playing.
I'm not buying a house to gamble, or play, or rescue anyone. I love the house we're buying, but what sold me is the neighbors, Christmas caroling, neighbors knowing each others' stories, pumpkin patch, block parties. Of course, we looked at the price point, the space, the floorplan, the long term issues we'll have to face, and we factored them in. But it comes down to the fact that this is not wholly a financial decision. If it were, we wouldn't do it.
I wish, I so very much wish, that I could get the foreign investors who owned the home we tried to purchase before this one to come to Detroit. As far as all the documentation read, they had never seen it. I don't think they'd ever been to the city. I wish they could have stood in the Florida room to feel the breeze, seen the children riding bikes up and down the block, gazed up the trunks of the massive oak trees. I wish they hadn't looked at the house solely from a financial perspective.
Because a house is so much more than a sticker price.
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