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Michigan Landlords and Tenants May Be Facing Big Changes

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The State Court Administrative Office has proposed new rules that would affect eviction cases. The proposal includes an option for online pretrial hearings in eviction cases, a tenant requirement to give landlords 48-hour notice if a jury trial is desired, a requirement that tenants be served in person if the landlord wants an immediate default judgement, the creation of a minimum 7-day window between pretrial hearings and trials, and the ability for tenants to get an automatic stay if they’ve applied for rental aid. The aim is to allow more time for commercial and residential tenants to pay what is owed when they fall short. In some cases, this will lengthen the eviction process. The intent is to continue the advances that were made during the pandemic. The rule changes are in a public comment period until Tuesday.

 

Duggan-Targeted Riverfront Apartment In Foreclosure

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The former River Plaza Apartments, a rundown apartment building between old Whittier Hotel and Owen Park, has fallen into foreclosure. The two-building property went into foreclosure with Columbia, Maryland-based Enterprise Community Loan Fund Inc. The property, one of 100 similar properties, was targeted by Mayor Mike Duggan to rid the city of blighted buildings. It’s unclear if the administration is still seeking demolition and there is no update on the plans. The foreclosure was scheduled at the end of December but was postponed multiple times; it finally took place in late August. The owner, Kathy Makino-Leipsitz, has until February 25, 2023 to redeem the properties.

 

Detroit Apartment Building Opens With Help From Detroit Housing Fund

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Detroit city officials, along with developers, celebrated the opening of The Charlotte, a renovated apartment building with 28 units. The apartment building is the first project backed by a $75 million private investment fund that was created two years ago to aid developers in building more affordable housing in Detroit. The redevelopment cost $3.19 million and is part of seven projects in the Detroit Housing for the Future Fund pipeline. A $2.55 million loan from a fund managed by the Detroit branch of the Local Initiatives Support Corporation helped bankroll the project. The fund has supported 269 units already completed or in progress.

 

Demolition of Historic Detroit Theater Makes Way for Parking Lot

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The Bagley Development Group has begun demolishing the historic United Artists Theater building in downtown Detroit. They are converting the attached office tower into 148 apartments. The space created by the theater’s demolition will provide parking to residential tenants. Detroit-based construction manager L.S. Brinker has partnered with Lansing-based construction manager Christman Co. to redevelop the office tower. Demolition of the theater is expected to take about 4 to 6 weeks. Homrich Inc. is the contractor on the building.

 

Free Legal Services for Low-Income Tenants Delayed

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A program to provide free lawyers to low-income Detroiters facing eviction is being delayed. The program was supposed to start October 1, according to the Detroit City Council ordinance that was enacted over the summer. Tenant advocates are voicing concerns over the delay, although legal services continue to be available through a statewide pandemic program. The ordinance offers legal representation in 36th District Court for tenants who are facing eviction and making below 200% of the federal poverty guidelines. The city is working to produce requests for proposals and is working its way through the American Rescue Plan compliance process. Funding for the program would last for over three years.

 

 

Apartment Construction Gets A Boost Due To Mortgage Rates

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New construction of multifamily properties jumped 28 percent in August. bringing the market’s multifamily segment to its highest level since 1986. The jump is due to rising mortgage rates. Single-family home construction also increased slightly in August after a two-year low. Borrowing costs have doubled since late 2020 due to interest-rate hikes designed to tame high inflation. Last week, the average rate on a 30-year fixed mortgage surpassed 6 percent. The continued low apartment vacancy rates and low single-family inventory have given multifamily construction a boost.

 

Cities Rethink Parking Rules

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The city of Ann Arbor recently voted to remove all minimum off-street parking requirements. Detroit is reviewing its zoning code, possibly implementing new rules regarding how many parking spaces are needed for uses like housing, retail and industrial. Both examples are part of a growing trend in Michigan and around the U.S. as cities rethink their parking rules. Complying with Detroit’s parking requirements is a pain and poses a threat to business growth. Some Detroit-area businesses and organizations think the parking minimums are old-fashioned and block the development of vibrant neighborhoods. Others remain skeptical of entirely scrapping all parking minimums.

 

 

Metro Detroit Rents Begin to Soften Amidst All-Time High

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Although metro Detroit’s average rent growth is 5.14% annually, and metro Ann Arbor’s is 7.14%, metro Detroit’s rent market is beginning to soften.  According to CoStar Group Inc., asking rents are $1,214 a month in the metro area. In Ann Arbor, the average asking rents are up to $1,443 a month. The largest annual increase between both areas was in Saline, with rents up 26.56% which equates to $1,311 a month. Birmingham/Bloomfield area averages $1,815 a month, which is down from $1,857. Detroit’s west side has the most affordable rent at $726 a month. According to CoStar’s director, inflation, rising interest rates and home sales prices, increasing maintenance costs and a rush of renters wanting t lock in rates contributed to increasing rents.

 

Metro Detroit’s Fair Market Rents Increase

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The U.S. Department of Housing and Urban Development is predicting rent hikes for the 2023 fiscal year in metro Detroit. It published fair market rents at a 11.9 percent increase for a two-bedroom apartment. The rate is increasing from $1,084 to $1,213, beginning October 1. This increase is higher than the Michigan and national averages which hover around 10.3 to 10.4 percent. Metro Ann Arbor rates are 9.7 percent higher. Kalamazoo County wins the prize for the highest fair market rent increase at 19.3 percent. Private sector data was used to estimate changes. The figures are used to determine rent ceilings for certain low-income and emergency grants, as well as the worth of housing vouchers and the maximum award amounts for Continuums of Care.

 

Revised Fisher Property Plan Approved by Farmington Hills City Council

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Farmington Hills City Council has approved a revised planned unit development and site plan for a skilled nursing facility and residential units at the St. Vincent and Sarah Fisher Center. The initial plan proposal was denied in October 2021. Optalis Healthcare and Robertson Brothers’ revised plan decreases the number of dwellings on the property. Originally, the plan included 156 townhomes, but now it includes a combined 94 townhomes and detached single family homes. The townhomes will face Inkster Road, and the single family dwellings would back up to the neighborhood west of the property. Optalis also decreased the bed count on the skilled nursing center from 350 to 100.