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Leaders address Michigan’s housing shortage amid rising costs

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Leaders address Michigan’s housing shortage amid rising costs

May 29, 2024 | 10:16 am ET
By Ken Coleman
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Leaders address Michigan’s housing shortage amid rising costs
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The panel discusses housing in Michigan (L-R): state Sen. Sarah Anthony (D-Lansing), Detroit Mayor Mike Duggan, Michigan State Housing Development Authority (MSHDA) Chief Executive Officer Amy Hovey, Ann Arbor City Council Member Linh Song, and Communities First President and Chief Executive Officer Glenn Wilson at the Mackinac Policy Conference May 28, 2024 | Detroit Regional Chamber photo

During a wide-ranging, one-hour conversation on Tuesday, Michigan residents discussed ideas on how to solve the state’s housing crisis. The event took place at the Detroit Regional Chamber Mackinac Policy Conference.

Panelists were Detroit Mayor Mike Duggan, Michigan State Housing Development Authority (MSHDA) Chief Executive Officer Amy Hovey, Ann Arbor City Council Member Linh Song, and Communities First President and Chief Executive Officer Glenn Wilson. State Sen. Sarah Anthony (D-Lansing) served as moderator. 

Leaders address Michigan’s housing shortage amid rising costs
Michigan State Housing Development Authority (MSHDA) Chief Executive Officer Amy Hovey at the Mackinac Policy Conference May 28, 2024 | Susan J. Demas

To the question of what is “driving the crisis,” the panelist answered with several ideas such as the lack of gap funding for prospective home buyers; not enough assistance from the federal government; and more attention from housing developers toward building affordable multi-unit housing as opposed to single units. More opportunities for buyers to secure down payment assistance, and more embrace of creating living opportunities that are diverse culturally and ethnically, and equitable funding in terms of regions of the state.

“It’s all about supply. We do not have enough housing units for families. Basic economics says that if you are short on supply, the demand, the cost increases,” said Hovey. “The market is not looking how it should.”

Hovey added that the federal government can do more to provide funding to address the need.

Anthony, who is chair of the Senate Appropriations Committee, pointed out that state government has set aside $50 million in funding that can help to address some of the panel’s concerns. 

Duggan said that the city of Detroit has partnered with area banks to provide $10 million in funding to help city residents who have rented in the past purchase a home.

“You cannot kick out the people who are in your affordable existing housing,” Duggan said.   

A University of Michigan Poverty Solutions report released in April and called “The Growth of Housing Wealth in Detroit and its Neighborhoods: 2014-2022” concluded that Black homeowner-occupants in Detroit amassed $2.8 billion in added home value between 2014 and 2022, which represents an 80% increase during that time. The study analyzed “changes in Detroit’s housing values for the nine-year period following the city’s municipal bankruptcy to understand how much growth there has been and whether that growth has been equitably distributed across neighborhoods and racial/ethnic populations.”

Michigan’s largest city, Detroit, is 77% African American. 

Meanwhile, although wages for low-paying jobs have risen across the U.S. at the fastest rate in four decades, the number of households struggling to get by in Michigan grew by more than 100,000 from 2021 to 2022, according to the Michigan Association of United Ways. That means 1.7 million households or 41% were living paycheck to paycheck.

Song pointed out that she and other City Council members in Ann Arbor have encouraged developers to create housing opportunities where immigrants, including those of color, are encouraged to live. 

She said that Ann Arbor city government has helped to lead an effort to develop affordable housing in a community called Kerrytown that previously had been a majority Black neighborhood where the residents had been displaced many years ago. It will be called Dunbar Tower and will include 63 units, named after the 19th century African American poet Paul Laurence Dunbar. About half of the apartments will be set aside for tenants at 30% of the area median income. The rest will be set at $600 to $750 a month. 

Leaders address Michigan’s housing shortage amid rising costs
The discussion was moderated by state Sen. Sarah Anthony (D-Lansing). She was joined by panelists Detroit Mayor Mike Duggan, Michigan State Housing Development Authority (MSHDA) Chief Executive Officer Amy Hovey, Ann Arbor City Council Member Linh Song, and Communities First President and Chief Executive Officer Glenn Wilson. | Ken Coleman

“It was a call from the community to recognize the historically Black neighborhood that’s been displaced by Kerrytown,” Song said. “What we wanted to do was make this a conversation—a deliberate conversation—on how we can remedy these inequities that came through in racist zoning [and] prioritizing single-family home ownership.”

Wilson said that the Flint-based nonprofit, which was founded in 2010, has developed more than 162 affordable housing units in Genesee County. He said that funding sources that offer flexibility in how dollars can be an important way to address the housing crisis. 

Wilson pointed out in Genesee County where a 1,500-square-foot house with no garage or basement can cost an average of $300,000.

“When you think about those particular numbers, how are people supposed to have that home ownership opportunity? The math don’t math,” Wilson said. “Unless we get additional resources you need to solve that problem, you’re going to continue seeing low-income families,” Wilson said. “This is not a partisan issue either. This is something that goes across both. If you do not have a wealthy person in your family, if you do not have someone passing down a home, it’s going to be very hard for you to get, one the American Dream, or two to be able to just have a nice home or apartment with your family.”