A major donation will lead to greater homeownership in one Detroit neighborhood. Thanks to a $2.5 million gift from Judith Yaker to start the Sam L. and Judith Yaker Fund, Southwest Solutions is leading a new program to turn renters into homebuyers.
Southwest Solutions purchased 60 homes in the Chadsey-Condon neighborhood; the homes were built in 2000 as low-income rentals. The nonprofit will now renovate 56 of the homes and offer mortgages to residents.
Here’s how the program works. The net average sale price of the renovated homes is about $35,000. Renters pay the mortgages to Southwest Solutions, keeping money in the Fund. The mortgage payments are estimated to bring in about $40,000 per year for Fund expenses, with the recovered principal going to more renovations in the neighborhood.
Part of the $2.5 million gift will go toward creating a new park and pavilion in the neighborhood.
Southwest Solutions will also offer financial counseling to potential homeowners.
The homes—called Newberry homes—sit west of Corktown, north of Michigan Avenue. They were built in 2000-2001, many funded through the Low Income Housing Tax Credit (LIHTC) program, which uses tax credits to encourage developers to construct affordable housing. According to Southwest Solutions, more than 1,300 LIHTC single-family homes in Detroit will be out of compliance by the end of 2020, and this program could be a model to increase homeownership across these homes.
“Homeownership is the bedrock of stable neighborhoods, and the Yaker Fund donation will have a transformative effect in supporting the Newberry project and the attendant revitalization and investment in the area that the project will spur,” said Steve Ragan, Senior Vice President for Development and External Relations at Southwest Solutions.