Innovative approach to affordable housing in Michigan proves successful

An innovative approach to the shortage of affordable housing in Michigan is proving itself a success, judging by demand from buyers.

Robinson Landing, the new neighborhood built just north of the Grand Haven Memorial Airport, is nearly complete, and most of its houses have been bought. 

The single-family home development is offering new homes priced below $280,000. The $7.5 million project is led by the nonprofit developer Michigan Community Capital in response to a housing crisis across the state. 

These three-bedroom, 2.5-bath homes are priced between $140,000 and $280,000. Of the 30 homes, 16 have been set aside for participation in the Grand Haven Community Land Trust project. All these homes are under contract and sold. 

The remaining 14 houses are market rate homes that are exactly the same as the Land Trust homes. They are priced at $209,000 to $259,000, with the exception of one two-story home that is $320,000.

“We have one house that is an available market rate home,” says Eric Hanna, president and CEO of Michigan Community Capital, the Lansing-based developer of the neighborhood. “And then there are eight homes that we have not yet listed. Part of the reason is that we are waiting on the local utility to complete some utility hookups.” 

Eric Hanna, president and CEO of Michigan Community Capital, speaks to an attendee at the Robinson Landing Black Party.

Some homes part of Land Trust

The Land Trust homes are on a 99-year lease. A homeowner pays about $30 a month for the trust lease, in addition to what they paid for the home and the normal mortgage that would come with it, Hanna says. 

Buyers of these homes must have income of about 60 to 80% of the area median income, which Hanna describes as “very much a living wage.” Future purchasers will have to meet a similar income criteria.

“It’s actually quite a nice cross section of people in the homes,” says Hanna, who attended a recent block party to meet the new homeowners. 

“It’s really important to note that those homeowners do still build significant equity in their homes over time,” Hanna says. “And the Land Trust also participates in keeping some of that equity in order for it to continue to purchase other homes and provide that opportunity to other people as well.” 

The Grand Haven housing project is coordinated by Housing Next, an Ottawa County nonprofit and housing advocate. Housing Next commissioned a study in December 2018 that identified moderately priced housing as a high-level need.

Program gaining momentum

Robinson Landing is one of a handful of such projects across the state. Michigan Community Capital is looking at lending on a similar project in Ypsilanti. 

“This shared equity model is starting to be given a little bit more weight,” Hanna says. “On the coasts and in more expensive markets, it’s a very common way to do housing for what we call the missing middle.

 “But in the Midwest, it's been tougher to get up and running. That's because real estate here has been, believe it or not, more stable than it is on the coasts. So the demand for these kinds of protections for price is a little bit lower here than it is in New York, California or Washington.”

Hanna says Michigan Community Capital continues to engage with municipalities up and down the Lakeshore about their housing challenges. 

“The state has recently announced some very significant job creation projects in these areas, and there's already a dire housing situation here,” he says. “We're really hoping that we see a response from the public sector to help ease that housing burden, because it's great to see the economy growing here. 

“There’s a dislocation problem with housing. It’s continuing to get worse. We don't have any currently scheduled to go into construction. We're very interested in working with local communities to solve that problem.”

For the Robinson Landing project, the city of Grand Haven provided the land, while financial support came from the Brownfield Redevelopment Authority and the Grand Haven Area Community Foundation.

“It didn’t really didn't utilize state resources for a variety of reasons, so local communities can do this on their own. They control their own destiny in that way,” Hanna says. 

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Read more articles by Shandra Martinez.