Fannie Mae Partners with Detroit Land Bank Authority to Stabilize Neighborhoods
WASHINGTON, DC – Fannie Mae has partnered with the Detroit Land Bank Authority to help stabilize neighborhoods hard-hit by foreclosure. Under the agreement, Fannie Mae will sell foreclosed properties to the Land Bank for a nominal fee, and contribute funds for the demolition of certain properties. In an initial transaction, Fannie Mae will sell 44 Detroit properties to the Land Bank, including 26 properties slated for rehabilitation and 18 for demolition. This agreement allows the Land Bank to make determinations on land and property use for the benefit of the local community.
"Vacant properties are a strain on the neighborhood and can depress property values for other homeowners," said P.J. McCarthy, Fannie Mae's Vice President of Alternative Dispositions and Real Estate Asset Management. "We are happy to partner with the Detroit Land Bank Authority to help transform these properties into homes for local families, or new community spaces. It is our goal to continue to work closely with local organizations to help bring life back into these neighborhoods. We look forward to additional transactions with the Detroit Land Bank."
"This deal with Fannie Mae is a very important piece of the Detroit Land Bank's larger strategy to stabilize neighborhoods through our auction program, demolition, and side lot sales," said Detroit Land Bank Authority Kevin Simowski. "The Detroit Land Bank is working with multiple financial institutions on similar deals so we can address every vacant house in our target neighborhoods."
This effort complements the Detroit Neighborhood Stabilization Initiative (NSI) pilot, announced by the Federal Housing Finance Agency (FHFA) earlier this year. NSI was jointly developed by FHFA, Fannie Mae and Freddie Mac to stabilize neighborhoods that have been hardest hit by the housing crisis. One of the goals for NSI is to match distressed properties with responsible non-profits for property renovation, resale or redevelopment.
In a similar effort, Fannie Mae has partnered with the Cuyahoga Land Bank in Ohio since 2009 to address the vacant property issue in Cleveland, returning nearly 1,000 properties back to productive use. By removing these uninhabitable houses, the Cleveland partnership has improved the conditions in hard-hit neighborhoods by converting vacant properties into a bigger yard for a neighbor, a new home or even a community garden.
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