On Andover Street, near Greenfield Road and Rotunda, a row of well-maintained homes evokes images of success.
The homes–most of which have been occupied long-term–are situated in one of Dearborn's most successful neighborhoods. But like much of the city, image isn't everything.
The city of Dearborn has been one of Michigan's hot spots for foreclosures since 2007, and some residents believe a glut of unoccupied, bank-owned properties are devaluing their property, and are undermining Dearborn’s closely-knit neighborhoods.
Marium Wilkie, a resident of Andover Street and a local realtor, has lived in her home for 14 years, and said the biggest effect of the foreclosure crisis has been the value of her home.
"We put a lot of work into this home," she said. "There was a time when I though we'd get about $200,000 for the home (if it were put up for sale), but now I think it would be worth about $150,000."
A Shrinking Problem?
Foreclosures have been a problem that have caused numerous issues for Dearborn’s neighborhoods and its government. But the good news is that the city’s foreclosure rate appears to be tapering off.
According to Realty Trac, 214 homes–or one in 184 homes within the city–went into some stage of foreclosure in September. More than one half of those homes–113 to be exact–were located in the 48126 area code, near the Detroit border.
A year ago, that number was 397; and in September 2009, it was 364.
The downward trend is a good one for the city, but Dearborn is still one ranked as one of the most active foreclosure communities in Michigan, according to data provided by Realty Trac. It has a higher forclosure rate than Wayne County as a whole, as well as the city of Detroit.
Mayor Jack O’Reilly said he felt the downward trend was an encouraging sign, but that the pain was palpable for the municipality, which has seen a significant drop in property tax revenues that fund crucial city services.
"We're still concerned about this as a community," he said. "We know that we're one of the cities that has really been affected by this crisis."
It’s unclear how long the trend will last, or how forclosed homes will continue to affect the city’s real estate market. But what is certain is until these homes become occupied, the number of foreclosed homes in the city will serve as a troubling sign of a slow economic recovery.
Empty Homes Create Crime, Blight
The city’s vacancy rate for homes is 9.3 percent, which is about double what it was 10 years ago, according to data gleaned from the 2010 U.S. Census, said Nick Siroskey, the director of Residential Services for the city.
“It’s about twice what it should be,” he said. “The most obvious reason for this is the economy.”
Though there’s no way to immediately indicate how many of the 3,529 vacant homes were actually foreclosed, unoccupied structures create a number of problems, from blighted properties to increases in crime.
Owners of homes near foreclosed properties are concerned about their property values as well as safety, said Mary Petlichkoff, the president of the Dearborn Federation of Neighborhood Associations.
“Foreclosures are one of the top concerns coming from the neighborhood associations,” she said. “It’s a problem for communities because the homes are not well-maintained ... I’ve seen situations where people are angry, and have destroyed the inside of a home because of the foreclosure.
“These are homes that might not be purchased any time soon,” she added.
Another issue that concerns residents is that the homes may be purchased en masse by investors who will flood communities with rental properties, Petlichkoff said.
As for crime, residents are banding together and being diligent about reporting crime. Wilkie said that in her neighborhood, residents are looking out for each other.
"If someone sees something that it suspicous," she said, "they call the police."
Good News Greeted Cautiously
The recent news that Metro Detroit home sales rose 8.2 percent, and that sales prices increased by 10 percent according to Realcomp in Farmington Hills, was greeted positively by realtors. But it’s too soon to say if Dearborn’s real estate market is out of crisis mode because low-priced, foreclosed properties are available in abundance.
In Dearborn, there’s also good news: According to Realcomp, homes within the city are selling again. So far in 2011, 2,069 single-family homes or condominiums have sold, versus 2,190 for all of 2010. In 2007, 1,340 homes sold, versus 1,431 in 2008 and 1,992 in 2009.
O’Reilly worries that a second wave of foreclosures–which have reduced the city’s overall tax base–will take grip as banks that have been holding off on reverting homes move forward with more reposessions.
“We’ve been told to expect more,” he said. “I would want people to know there are programs that can help them.”