Detroit Mayor Mike Duggan seeks to enact an ordinance that would require property developers’ housing projects to have affordable units to low-income households.
The cost-friendly units would account for 20% of each project that has at least 20 units. The fraction was based on area median income and if the properties will be located on government-owned land or buildings. Projects that receiving grants from the Community Development Block Grant, HOME Investment Partnership Program and other funding initiatives.
Some property developers understand the logic behind the proposal, but it should not serve as a deterrent for building new homes. The financial incentives for building homes in the city are already few, so implementing the ordinance should not further discourage companies to pursue new projects.
Depending on the terms of the proposed ordinance, it may affect the pace of new home construction either in a positive or negative way.
Pros and Cons
U.S. Census Bureau data showed that there were 15,176 new construction permits for projects in the state in 2016. While that’s slightly lower than the forecast, the number represented the highest recorded figure since 2006.
If you’re thinking of buying a house, Kalsee Credit Union noted that now is likely a good time. There’s no argument that many people believe that the best mortgage rates in Michigan are only when they're low with flexible terms.
Beyond the state, Americans are believed to be in a hurry to acquire homes before an increase in interest rates takes place, according to a University of Michigan consumer sentiment survey.
Many factors affect the progress of affordable housing in Detroit. Research certain trends and find the best financing package that aligns with your income. Even as investment in affordable housing may seem scarce, that doesn’t directly imply that you are left with no other option other than waiting for the market to pick up to buy a house.