The Effects on Cities of "Best Practice" in Tax Foreclosure: Evidence from Detroit and Flint

Sunday, February 1, 2009

 

Margaret Dewar

Abstract

Although property abandonment affects many cities, little is known about what becomes of that property or what institutional differences lead to varied outcomes. More rapid tax foreclosure in Michigan, touted as best practice nationally, offers the opportunity to investigate who loses property and what property becomes after tax reversion. Two counties' practices, using different approaches to foreclosure prevention, revealed large differences in the numbers of owner occupants who lost their homes. Use and condition of auctioned properties primarily reflected use prior to foreclosure. However, other, more deliberate ways of selling tax-reverted property enabled many more owner-occupants, next-door neighbors, and developers to purchase and reuse property. The processes for sale of tax-reverted properties can thus determine productive reuse of property with positive effects on surroundings.

Download