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Detroit Mayor Mike Duggan on Tuesday announced a new fund to address housing instability in Detroit that would offer developers low-interest loans, private grants and other financial tools to preserve and create affordable housing. 

The public-private partnership begins with an initial investment of $48 million, which includes a $15 million commitment from JPMorgan Chase and $10 million guarantee from the Kresge Foundation. The overall goal is to raise $75 million.

“If you want to hold rent low enough that people of low income can afford it, but your housing costs to build are the same as every place else, you lose money,” Duggan said. “Nobody is going to build apartment units where the cost of building it costs more than they get back.” 

The partnership — called the Detroit Housing for the Future Fund — will finance housing for residents whose income is at or below 60% of the area median income or AMI, which amounts to $33,000 for an individual and $47,100 for a family of four. However, priority will be given to housing developments for people with lower incomes. 

More: Replay: Duggan announces launch of major Detroit affordable housing fund

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Developers can go to www.detroithousingforthefuturefund.org to apply or learn more about the effort.

Sonya Mays, president and CEO of Develop Detroit, a nonprofit real estate company, said the high rent of new developments burdens seniors and working Detroiters. 

“In Detroit, it costs more to renovate an apartment building that can be paid back and commit yourselves to keeping those rents affordable. This is the dreaded funding gap.” she said.

With “more flexible capital,” organizations like Develop Detroit will be able to create affordable housing quickly to keep residents in “stable high quality housing situations,” she said. The