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Lay of the Land, Part 1: How Detroit's Housing Crisis Got Worse

As I mentioned earlier this week, I sat down with Deborah L. Younger, the executive director of Detroit LISC, for a conversation about Detroit and our seemingly intractable land issues. Younger has also been appointed treasurer of the newly formed Detroit Land Bank Authority by Mayor Dave Bing. If anyone knows what it'll take to get a better handle on our land woes, it'd be her.

She held forth on a number of topics, including previously horrendous city planning, how racism and neglect combined with the economic meltdown to devastate our housing market and how the city appears to finally be getting more serious -- and realistic -- about managing its 138.77 square miles of terra firma.

It's lengthy, which is why I'm posting in two parts, but I also think her diagnoses are especially important since Younger is expected to play such an instrumental role in city policy going forward. In the first part of the discussion, she explains why our land crisis has gotten much worse in recent years. In part two, which I'll post tomorrow, she explains how we can really turn Detroit around.

So check it out when you can – and let me know your thoughts on her ideas and perspectives...

So is downsizing our best hope in Detroit?

DEBORAH L. YOUNGER: I don't like to use words like downsizing. Because we're not giving any land back. We're not going to say, ‘Here, Southfield, take some of this.' So what we really have to do is what I like to call re-imaging, re-imagining. That's really what we have to do. I think it's better to really figure out how we're going to return land to productive re-use. That doesn't mean becoming the Detroit of old. Most people talk about bringing people back to Detroit and all of that. Well, I don't think that that's immediately in our future.

What's immediately in our future is figuring out how we can be the best city of 800,000 to 600,000 people that we can be. We've got 139 square miles of land, so we have the land mass that can support 8 million people. And we maybe have 800,000 people. Hence we speak of the infrastructure and all. Well, we don't have the population base to support the infrastructure that we have. And then (that's) combined with us undergoing some of the worst economic times of the last 20 years. So not only do we not have the numbers, but sadly, the socio-economic status of the population that is left can't support the infrastructure as well.

How do we start?

DLY: There are critical tools (to help) – the land bank is one that's just up and getting going.

We have a land bank in Detroit??

DLY: Detroit is the only city in Michigan that is allowed to have its own land bank. There is a state (land bank) and there is a county (land bank), but the city's land bank has been operational since August. This is an organization that is building up from ground zero. It's a brand-new organization. The members are appointed three by city council, three by the mayor and one joint appointee. I am member of the land bank. I was appointed by the mayor. And I serve as the treasurer, go figure, the one who has to raise money for the land bank. So while the mayor and other leadership will set the vision for how the land bank operates, really the policies that the land bank implements around the management of property will be critical to the city's future. Certainly there has to be a vision, and we're hoping the mayor will articulate a vision that will lead our work.

But the mayor doesn't appear to have laid out any vision for land management or the land bank.

DLY: I think he does have a vision. We've met with him. I don't think he's ready to articulate it. I certainly don't want to speak for the mayor, but he has talked about master planning.

Even though the city just approved a master plan – finally – after eight years, it's antiquated. The plan was developed over eight years ago. And it took the city council eight years to approve it. So it's certainly not relevant, although it does allow for revisions. One of the things about planning in general: Most schools of planning teach you to plan for growth, not planning for shrinkage. And that's pretty much what this plan looked like. It does not plan for shrinkage. A new master plan would have to look at that.

We wait eight years for a plan and then it's outdated? Figures. What's changed in the time since the plan was conceived until now?

DLY: Foreclosure. We have just as many tax foreclosures as mortgage foreclosures. A lot of time it's people who have been in their house 30 years and can't pay the taxes and are losing their homes. We already had an economic crisis, and then came the foreclosure issue. For those of us who work in the field, we always hear about the irresponsible consumer who went out and over-mortgaged his home. In Detroit, that wasn't the case. It was, for the most part -- and I'm not saying that (irresponsibility) wasn't the case in some instances --- it was mostly predatory lending.

Detroit is not banked by traditional lenders. Seventy percent of the loans that were made in Detroit were made by brokers. When you look at the statistics, many people who got into these loans had scores of 700. They didn't need these types of loans. And because this community has not been banked by traditional bankers…they're here but only about 30 percent of the loans were made by them, by the B of As and by Chase.

Why do you think that is?

DLY: Why do you think? (Chuckles) I think it's the reasons we'd all think. There's redlining and racial bias. Detroit has had a strong history of that.

So it's a situation where banks are just turning people away, turning them down?

DLY: It's two things: Minority communities are typically word-of-mouth communities. If you hear your cousin Jo-Jo got a loan from so-and-so, you're like, ‘I make more money than Jo-Jo.' So smart brokers came in, worked communities, worked neighborhoods. So it was a combination of traditional banking not being aggressive, not really reaching out to those markets. I'm not going to say they turned down clients, but they didn't make a presence in these neighborhoods; they didn't work them in a way. So brokers are smart. They come in; they know it's a word-of-mouth community. They have outreach everywhere, so they are able to make in-roads into these markets. So you had a combination of redlining. And some of it was sheer neglect. There certainly was redlining and racial profiling, but it was a combination of all those things. And like I said, we have as many tax foreclosures as we do mortgage foreclosure in this city.

So you had a combination of all those forces: brokers who were unscrupulous, but aggressive and smart; banks who were redlining and even those who did want to lend didn't know how to reach out.

A perfect storm, eh?

DLY: Exactly. You had all those things that made us just ripe for this. The numbers are staggering. We have a team from Detroit. We're self-appointed, self-anointed. We call ourselves "The Vacant Property Leadership Team." LISC is a member of this. We've been trying to tackle all the issues that are going on, from appraisal problems to all the things that are keeping us from moving vacant property back to productive reuse and trying to develop the infrastructure and system, including trying to stimulate capital. There's no capital in Detroit right now. Nobody will lend in Detroit – or Michigan, not just Detroit.

Because of the employment situation?

DLY: Yes. When the state housing agency can't sell its bonds, it's bad. Those are always seen as safe.

So it's pretty tough. There's no investors. They don't want to come into Michigan. We have more foreclosures than 16 other cities combined. We heard some people complaining: ‘We have 5,000 foreclosures.' We're like, ‘Stop your whining.' We're approaching 100,000, which would be close to 30 percent of the houses.

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  • 1

    Why can't she just say it? "We need to abandon entire neighborhoods to survive."
    Political double-speak is a symptom of Detriot's problems....

    • 1.1

      To abandon entre neighborhoods sounds like a logical solution, But one would have to factor in the emotional attachment to the area and friends that may be there also. Unlike here in the "burbs" alot of the small communities scattered around the decaying neighborhoods of Detroit, the occupants are close to their neighbors. They sit on the pourch together and often times support each other in one way or another.

      To ask, or even demand some one to abandon their home, for the sake of "downsizing seems well thought and well intentioned, it more then likely is just a dream.

      I live in the "burbs" I hardley know my neighbors. Not because I don't want to get to know them, but because I work odd ours and have other pressing responsibilities. So if I was given a chance to "relocate" I probably would. But for those in Detroit who do have great friendships with their neighbors the aspect of loseing those friends and confidants is a big loss for them. Sometimes when all is bleak and hope is far away all we have is friends, and loseing them is like loseing a cherished love one.

      So John while your Idea, and the echo of it is voiced and heard by many others, the reality of it would just be unfathomable for alot of the residents to bear.

      They may not have the money to move, or be unable to emotionally let go of their life where they are at. Also who would pay for such a move of all of those people? Woud you donate you time and or a considerable amount of money that it would take to move residents of the City? Would you expect the City proper to do it with the struggle that they are in? Or would you expect every one to just pack what they could carry and walk it to the new dwelling?

      All of the aspects of Downsizing a major city are very complex and costly to be sure. Nothing short of a military type mission could accomplish that feat.

      What we could do though, Move back in. There are still plenty of people in the Greater Metro Detroit area who have jobs, Lets just move back in and replenish what has left. Lets just mix it up a bit, take all that has made the "burbs the place to be and bring it back to Detroit for the sake of arguement.

      Lets turn the tables on the problen of flight out and make it about flight in. Lets reverse the problem, lets reverse the "Great white flight" and reinvent a city to be revered and sought after by the very people and businesses that left it long ago. Detroit is in debt up to is head, the schools suck, lets infuse our "burb" money and make it great once again. How does that sound, I'll gladly sell my house and take a loss just to put it back into a rebuilding of a great city, and I just may. It would make sense really I could kill a mortgage for a much cheaper one and pay it off sooner too, and the extra money would rehab the house in no time flat.

    • 1.2

      This is fairly well-known I thought. She said it plainly.

      The infrastructure was built to accomodate 2 million plus. The population is .8 million and trending down. As soon as a consensus is reached that a turnaround is unlikely, everything must be rescaled down.

      - Charles Williams
      (born Detroit, now resident in Chicago)

  • 2

    This mess did not happen overnight. The predatory lending was definitely not the fault of the city or many individuals but many other issues responsible for the poor quality of life in the city like the failure to deal with abandoned homes and the lack of support for faltering neighborhoods was the result of years of "looking the other way."

    Well if she did refer to the "previously horrendous city planning"--your words, not hers--this would be an interesting interview because it the first time I remember a city official say "we messed up." Well, that's new and a change for the better from the City of Detroit I knew.

  • 3

    Predatory lending??!! I think it should be called what it is/was - Accessable Lending, or Government Encouraged (read 'nudged') Lending...

    Have we lost any/all sense of individual responsibility in Detroit's or any similar problems? If so - we are indeed doomed as a city...

  • 4

    AMEN!,...I'm white and was a lifelong Detroiter who tried to get financing from , then, NBD, with perfect credit AND high paying job, and was turned down because I lived on the "wrong " side of Lahser Rd. Very Frustrating! But what finally forced me to leave was the VIOLENT CRIME!..IT HURTS TO ADMIT IT, but Young Boys Inc., would stand on corner of Lahser and 7-mile (VERY BUSY street) in front of the "Y", and easily sell their S-it in the open! I tried to help a neighbor lady AND her teen son fleeing a group of punks, only to find out it was THE LADY AND HER SON who were pulling their guns on THE PUNKS! STILL, the final straw was when, at 2:00 pm, a car with 4 'guys' jumped out and beat a guys head with a traffic barricade...ON 7-mile!...At 2:00pm!..In heavy traffic!..And I was only person who got out of car to try to Help!..THAT Was it! If people didn't care enough about humanity to get together and help someone, who might help if MY WIFE or Kids were jumped?!.. Stil,..I LOVE everything great about Detroit and will never Bad-Mouth it. I've been victimized by petty-crime(front door stolen when I went to work-Hillarious!- it really was!-)Getting jumped on on first unofficial 'KING'Day..IFirst thing on most Detroiters' minds would have been.."..Were 'THEY' .." Race Card inserted HERE!..Doesn't matter! Obviously, Then State SEN. Coleman A. Young was a victim of severe Racism, and Anti-'Communist' sentiments that , Literally "colored" his political life. No wonder he played the race card, when he felt forced to play. HE WAS A POLITICIAN! AND HE WAS ENTITLED TO FEEL THE WAY HE DID!..BUT the results were devastating for certain neighborhoods as the city's economy shrank due to perceived racism from whites AND blacks, bailing' on their neighbors! A tale of 2 cities: Detroit the way it is due to "boss politics AND RACISM...Chicago the way it is due to "Boss politicsAND RACISM( R. Daly). When my generation was growing up THE D and Chic. were equall in many ways. 1n 1970 Boston , only a third Detroits' size, was in much worse shape than Detroit. But they had 'the Kennedy machine' to pimp for them. PSS America(K)a! What's happened to Detroit and 'burbs...IS COMING YOUR WAY !

  • 5

    [...] check it out -- as well as the first half of the interview -- and offer your own thoughts about the issue and her ideas… OK, so you've laid [...]

  • 6

    It's odd how it works, but as someone with a college degree and who had a class in macro-economics, I saw this real estate scam as it was happening and benefited from its crash with a nice house at a good price and a low mortgage rate. However, I didn't see this same predatory market as it was happening to a family member with just a high school diploma because I wanted to believe "this would help them out." This whole lending scam was a top-down crime that should have never happened, but it is just one of many of Detroit's problems.

  • 7

    The available real estate in the area is astounding. Lots of the stuff out there is in pretty poor shape, but can be salvaged with a little TLC. I was out near Forest Avenue on Thursday and saw some pretty vintage homes that were unfortunately "stuck" right in the midst of an area you would not want to live.

    You would probably need a door gunner just to get through the hood so you can get to work.

    The problem really boils down to the community's health as it relates to crime. Unless somebody in charge starts busting some butts and locking up hardened criminals and "Young Boys Inc", there will be a continued erosion of the neighborhoods and tax base. That Land Bank inventory is going to get bigger before it gets smaller I suspect.

    I would buy a home down there and gladly take it apart brick by brick and ship it to a safer neighborhood where I could reassemble it and flip it for a decent profit. In addition, I would fill in the hole left from the basement and turn the empty lot over to somebody who wants to plant a community garden.

  • 8

    mogrady's comment about Crime is 'right on target'.... People will not invest financially, emotionally, or intellectually anywhere if there is a perception (real or not) that it is not safe...

    New York City's turnaround began with the civic will and comittment to address Crime - Felonies as well as Quality of Life crime - to give residents the feeling that there was indeed order and that someone was in cgharge...

  • 9

    [...] a recent interview with the head of the Detroit chapter of the Local Initiatives Support Corporation (LISC), I was [...]

  • 10

    As an Architect who has designed a solution to the New Orleans housing problem as a result of hurrican Katrina, I offer a similar solution which can be used to solve the Detroit housing problem which will give the City a clear vision. If interested in seeing graphical solutions either visit my website or contact me directly at Thanks for your interest.

  • 11

    […] Detroit's symbolic importance to the left goes beyond being a city rocked by globalization, redlined into gentrification and starved by conservative governance. Michigan gave birth to automobile industry then the […]

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