DETROIT (AP) - Detroit and the Rocket Community Fund said Thursday that they are contributing $5 million to a program that renovates houses and provides better access to financing for existing and potential homeowners.
The funding is expected to add at least 200 homes across 10 Detroit neighborhoods to the Rehabbed & Ready program, which turns blighted single-family homes owned by the Detroit Land Bank Authority into move-in ready ones. The land bank oversees the renovations.
The $2.5 million from the Rocket Community Fund will finance renovations and help cover the gaps between construction costs and the sale prices of homes.
“We are driven to ensure that every Detroit resident has reliable access to sustainable housing and has the opportunity to grow wealth through programs like Rehabbed & Ready,” said Laura Grannemann, Rocket Community Fund vice president.
Rehabbed & Ready was created in 2015 in response to artificially low Detroit property values and difficulty prospective buyers were having in securing mortgages to buy homes in the city. Less than a decade ago, fewer than 375 mortgages were given annually in Detroit and the median sales price of a home was less than $10,000.
“The Rehabbed & Ready program has made affordable home ownership possible for a lot of Detroiters who may not have been up to the challenge of renovating a vacant Land Bank house themselves,” Mayor Mike Duggan said.
The Rocket Community Fund is the philanthropic arm of Detroit-based Rocket Companies. It founded Rehabbed & Ready with an initial $5 million investment.
Since the program’s start, 85 homes have been closed on, according to the Rocket Community Fund.
The average combined cost of the properties and renovations is $114,540, while the average sales price of the homes is $97,711. The Rocket Community Fund covers the difference.
Billionaire businessman Dan Gilbert is founder and chair of Rocket Companies. Last month, he announced that the Rocket Community Fund and the Gilbert Family Foundation would invest $500 million to improve Detroit neighborhoods.
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