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property tax foreclosure

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.

Sarah Cwiek / Michigan Radio

Another 50 Detroit families will own the homes they currently live in, thanks to a city program.

City of Detroit

After years of being ravaged by property tax foreclosures that claimed more than one in three city homes,  Detroit will see fewer than 5,000 properties go to the annual Wayne County tax auction this fall.

The county announced preliminary 2018 tax foreclosure numbers Friday. They show the county is set to foreclose on 4,676 properties this year, with 1,499 of them occupied properties.

Sarah Cwiek / Michigan Radio

Detroit expanded a program this year that gives some people a last-minute chance to avoid tax foreclosure, but its reach could be limited by time and money.

Urban Institute

African-American homeownership has fallen further in Michigan than in any other state since 2000, and a growing number of low-income renters in Metro Detroit are “being squeezed from all sides” when it comes to finding affordable housing.

Those are two just two notable conclusions from a series of reports released by the Urban Institute this week about major issues in Southeast Michigan’s housing market.

Wayne County

Detroit has settled a lawsuit filed by the ACLU, alleging the city made it too difficult for residents to learn about, and qualify for, a property tax exemption based on poverty.

Thousands of Detroiters in poverty paid property taxes they didn't owe because they didn't know they were exempt, and the city didn't tell them.  Many lost their homes at tax foreclosure auctions when they couldn't pay the taxes.

Sarah Cwiek / Michigan Radio

One Detroit family celebrated getting a new home Thursday, as they also called for other families like them to receive similar compensation as victims of what they call “illegal” foreclosures.

House Foreclosure
Steve Carmody / Michigan Radio

new lawsuit says Michigan’s property tax foreclosure laws are unconstitutional and amount to “government sanctioned theft.”

The case was filed this week on behalf of two men who lost Oakland County properties to foreclosure.

One of the men, Uri Rafaeli, lost a rental property in Southfield when he miscalculated the amount of interest he owed on 2011 property taxes by $8.41. Oakland County foreclosed, then sold the home for $24,500.

BasicGov / Flickr - http://bit.ly/1rFrzRK

Many people in Detroit cannot or, sometimes in the case of landlords, do not pay property taxes. Every year, the Wayne County Treasurer's Office seizes owner-occupied homes and puts them up for auction.

Even with recent efforts to get homeowners on installment plans, lowering interests rates, and letting more low-income people know they might be eligible for property tax wavers, it hasn’t been enough to keep many people in their homes. There’s a high poverty rate in Detroit.

A foreclosure sign.
Steve Carmody / Michigan Radio

An effort to help some Wayne County residents from losing their homes to tax foreclosure seems to have stalled. Until the last minute, low-income property owners were being encouraged to apply for tax exemptions, with the hope of preventing their homes from being sold at Wayne County’s annual auction of tax-foreclosed properties.

Detroit City assessor Alvin Horhn’s office promoted the idea that some low-income homeowners might be able to avoid tax foreclosure this year if they hurried to apply for a tax exemption.

Steve Carmody/Michigan Radio

Many homes that go into tax foreclosure in Detroit are owned by landlords. The renters are often booted out once the homes are sold at auction.  

In a pilot project, Detroit has bought 80 of these homes where tenants have expressed interest in becoming homeowners.  The city used right of first refusal for the purchases. That means the city can buy the properties before they go to auction, paying only the county and state portions of the taxes owing, but not the city portion.