Detroit home tax foreclosures: Why they've dropped dramatically

Kat Stafford | Detroit Free Press

Tax foreclosures of owner-occupied homes in Detroit have dropped 89 percent since 2015, officials announced Friday, continuing a downward trend across the city.

Preliminary numbers released by the Wayne County Treasurer’s Office show that Detroit's owner-occupied foreclosures have fallen from 6,408 in 2015 to 708 at risk this year.

"We have no prospect of increasing the population in this community if we keep losing people through foreclosure," Mayor Mike Duggan said at a Friday news conference. "Treasurer Eric Sabree has been the most aggressive ... you've got a treasurer who's doing everything he can to keep people in their houses."

According to officials, tax foreclosures of all city occupied homes, including renter-occupied, is down 84 percent since 2015, with 1,517 homes at risk this year, down from 9,111 three years ago.

Overall, residential tax foreclosures, which also includes vacant properties, are down 81 percent since 2015, down to 4,709 at risk in 2018.

The city's foreclosure numbers haven't been this low since 2008, which was just before the housing industry collapsed, when there were 4,392 total foreclosures.

Officials said they expect the numbers to drop further, thanks to a number of prevention efforts in place, including the city's expanded first-refusal program, which launched earlier this month. The program allows the city to buy the properties before they go to auction.

"Our partners have worked tirelessly," said Wayne County Treasurer Eric Sabree, adding that community groups have played a major role in the effort. "They did the lion's share of the work ... and these efforts have worked. We knocked on over 5,200 doors letting people know their properties were at risk."

Read more:

The program, expanded after a successful pilot last year, is slated to give up to 300 more Detroiters facing tax foreclosure the opportunity to stay in their homes.

The initial pilot helped more than 80 families avoid foreclosure. The administration this week submitted a request to Detroit City Council to allow the city to receive around $5 million to fund the expanded program. Quicken Loans already has committed significant funding to the program.

According to officials, the more than 700 at risk for foreclosure still have a chance to try and save their homes, thanks to the city and nonprofit United Community Housing Coalition. Homeowners are encouraged to reach out to the nonprofit for help.

The Free Press previously reported that in August, the nonprofit will lose two key grants funded by the U.S. Department of Housing and Urban Development. A total of $1.1 million will vanish from its budget by the fall — 40 percent of the organization's overall financing, 90% of its housing placement capital. It was not immediately clear how those funds would be replaced.

"Tax foreclosures are the biggest component of what we do," Michele Oberholtzer, who works in the coalition's tax foreclosure department, said earlier. "We are still seeing tens of thousands of property owners getting foreclosure notices."

Detroit City Council member Gabe Leland, who has spent time door-knocking to alert residents to potential tax help, said the effort has been ongoing for the past 13 years.

"At the time, never before did I think we would have the partnerships that we have now," Leland said. "Residents, they know that government is here for them and we're no longer going to let them fall under and lose their home."

Detroit residents Rachel Sims and her husband Alfonzo Sims said they are on the path to becoming first-time homeowners after they were nearly kicked out of a home they were renting recently, when the landlord decided to stop paying property taxes.

"We had been in the house for almost a year," Rachel Sims said. "I wanted stability for my daughters, stability for the entire family. I was ready to leave Detroit."

Sims said she was able to work with the coalition and she's close to owning the home.

"There's hope," Sims said. "I kept my faith and I'm so excited about being a first-time home buyer. I want my kids to understand you have to go out and try and see what's out there."

Contact Katrease Stafford: kstafford@freepress.com or 313-223-4759. Staff writer Allie Gross contributed to this report.

Need help?

Contact United Community Housing Coalition at 313-963-3310.