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515 Detroit families will get to stay in their homes, thanks to tax foreclosure buy-back program

The Tricycle Collective is working to help keep families in their homes through the tax foreclosure crisis in Detroit.
Michele Oberholtzer

515 Detroit families have the opportunity to stay living homes that were headed to tax foreclosure auction this fall.

They’re on the list for a buy-back program that involves the city of Detroit, Wayne County, and a non-profit housing group.

Michele Oberholtzer is with that group, the United Community Housing Coalition. She calls it a “historical” moment.

“It’s powerful, it’s incredible what we can have,” Oberholtzer said. “There has not been a single law changed. What’s changed is our cooperation, our willingness, all the different pieces coming together.”

The city will buy the foreclosed homes back from the county through a process called right of first refusal. The city will then deed them to the Housing Coalition, who will pass the deed onto the new homeowners once they’ve paid a pre-negotiated price.

Oberholtzer says the Housing Coalition, with help from the city and partners like Quicken Loans, raised enough money to cover buying the homes back from the county. The Coalition has also collected more than $200,000 in savings from participants that will go toward down payments on the price of the buy-back.

For the 175 low-income homeowners in the program, the sale price is $1000, per a lawsuit settlement between the ACLU and city of Detroit. The other participants—mostly renters whose landlords allowed the properties to go into tax foreclosure—pay a portion of the back taxes.

Oberholtzer says that for years, many people in this situation tried to win their homes back by bidding on them in Wayne County’s annual tax foreclosure auction. Some assumed they had priority over other bidders, but many lost out to higher bidders, often real estate investors and speculators with no connection to Detroit.

But Oberholtzer says this program does give them priority. “That was a rumor that we ultimately turned true through this program,” she said. “We recognized the value of homeownership, of stability.”

The program brings the number of occupied properties that will be sold at auction next month down to around 1000, the lowest number in years. Though numbers are down significantly in the past couple of years, tax foreclosure—and property tax delinquency—remain major problems in Detroit.

“We’re still losing more than we’re winning,” Oberholtzer said. “But it is a strong tide in the right direction.”

Sarah Cwiek joined Michigan Public in October 2009. As our Detroit reporter, she is helping us expand our coverage of the economy, politics, and culture in and around the city of Detroit.
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