‘A place for us’
Last fall, Virginia Hayes moved from a trailer park into a two-bedroom, 844-square-foot house in Flint, Michigan. The driveway of her new home was full of stinking garbage, the garage full of black mold. Two raccoons lived in her attic. There was a two inch-wide gap between her bathroom’s tile floor and tub.
Her 8-year-old son, Abel, couldn’t spend much time at the house while it was in that shape. The pungent, ever-present smell of raccoon droppings and exposure to black mold irritated his asthma, making it hard for him to breathe.
But the house was hers. With hard work, Hayes thought she could turn it into a safe and permanent home for Abel.
“That’s what he deserves,” she said. “He’s just a little boy.”
Then, days after moving in, she received a visit from a man named Adi Asraf. He introduced himself as a representative for her new landlord and said that if she wanted to keep living there, she’d have to pay rent. Hayes thought it must be a misunderstanding.
“I’m not even supposed to pay rent, I’m supposed to own the place,” she said.
Hayes couldn’t afford to pay Asraf’s asking price of $850 per month. She was unemployed and couldn’t access her birth certificate, which made getting a job almost impossible. Asraf said if she wanted to stay, she needed to fix up the place before city inspectors could condemn it.
“I don’t have nowhere else in the world to go, so I agreed to,” she said.
For the first few months, Hayes spent her time repairing and cleaning the house. Asraf asked her to send him weekly progress pictures over text to ensure she was doing labor worth $400-600 each month. If she did, he’d deduct it from her rent payment. It was dangerous, dirty work — since moving in, she constantly felt sick. She got three bloody ear infections in five months. Still, the dream of making it safe for Abel kept her going.
“I’m thankful I do have a roof over my head,” Hayes said. “Just because I share it with raccoons doesn’t mean I can’t be thankful for that.”
Months before moving in, Hayes gave her friend a promissory note (a legally-sound IOU) in exchange for ownership of the home. So when Asraf called himself her new landlord, she was confused and even suspected that he bought the house illegally.
But the purchase was perfectly legal. It was just rare in Flint.
Here’s what Hayes didn’t know: her friend didn’t pay property taxes in 2020. For the two following years, she failed to repay them. Because of this, the house was foreclosed on in May 2023, meaning the Genesee County treasurer took possession of the house.
Michigan law requires county treasurers to list foreclosed properties on the Michigan Public Land Auction (or tax sale) website, where anyone without delinquent property taxes can buy them. Treasurers can either sell these properties individually or package multiple properties together into bundles. Even with the addition of unpaid property taxes (back taxes), which buyers have to pay off, treasurers list each item well below its market value.
At Genesee County’s online tax sale last September, To Life Real Estate, a Florida investment company Asraf represents, bought a bundle of 230 homes, including the one Hayes was about to move into. To Life only paid around $5,400 for each house.
News of this sale shocked those living in the purchased homes. Though foreclosures were common in Flint, in past years, no one bid on the foreclosed properties at the tax deed sale. They’d then land by default in the hands of the Genesee County Land Bank (GCLB), a quasi-governmental entity that buys and holds property in Flint and its surrounding areas. The GCLB works with residents to keep people in their homes — eviction is their last resort.
That’s the foreclosure process the people living in these homes were expecting. Instead, they got Asraf as their landlord. He gave no such assurances.
Hayes said Asraf seemed nice until she acted smarter than he thought she was. Then, he didn’t act nice: “He tells me if I don’t like it, I can just get out.”
Their home repair arrangement lasted until late this February, when Hayes got a letter with a notice to quit, which is the first step in the eviction process. Her eviction hearing was scheduled for March 19th.
Abel turned 10 years old on March 31st. If she got evicted on the 19th, Michigan law gave her ten days to find somewhere else to live. With no connections, no birth certificate, and little savings, she didn’t know if she’d still have a roof over her head, racoon-infested or not.
“I don’t want to be homeless for his birthday,” she said.
Before this sale, people didn’t see value in Flint real estate because of its infamous past, according to local writer Patrick Hayes (no relation to Virginia), a professor at Mott Community College in Flint. He said the city’s bundling of foreclosed homes is evidence of this: “They’re like, ‘Well, no one’s gonna buy [230] houses at once. Why would anyone want that?’”
Patrick Hayes thinks real estate is Flint’s greatest strength right now. In Flint, home ownership is still possible for young people — while prices all across the country climb, Rust Belt cities remain cheap home oases. The median Flint house costs almost 72% less than the median Michigan house according to Redfin.
Yet homes are cheap for a reason. The city’s name has been synonymous with urban dysfunction for decades — certainly since the late ’80s, when General Motors plant closings caused thousands to lose their jobs and white flight was well underway. Flint shrank by half in the following 50 years. So when the bundle sold for its opening bid of about $1.08 million plus $170,000 in back taxes, Flint residents wondered why To Life Real Estate would put such a large investment into Flint homes.
That’s where worry creeps into many residents’ minds. In Flint, where a third of residents live in poverty (compared to 11.5% nationally), a capital investment of this kind has the power to do more harm than good.
Running on fumes
Before its water crisis or its rise in violent crime, Flint was known for its thriving auto industry.
The city of 80,000 people, about 70 miles northwest of Detroit, is full of wide avenues and parallel parking spots. Its downtown area is a quiet strip of restaurants, shops, and businesses that lay on either side of Saginaw Street, a brick road first laid in 1897 with iron arches stretching across it. The central arch proudly reads “Flint Vehicle City.”
Founded in Flint in 1908, General Motors (GM) quickly became the lifeforce of its home city, providing jobs, cars, and housing to its workers. Before and during the Great Depression, though, GM was an unforgiving place to work.
“If you tell ‘em you were sick, they’d say, ‘Die and prove it,’” J.D. Dotson, a GM factory worker, said in an oral history project.
In 1936, the recently-created United Auto Workers (UAW) union organized a sit-down strike in a Flint GM plant. It was an unlikely success that garnered workers higher wages, safer working conditions, and benefits. With this, Flint officially became a working class utopia.
“It was an enormous celebration all over the city that night,” Shirley Foster, a union organizer’s wife recalled in 1999. “Flint would never know a feeling like that again.”
As GM flourished throughout the 20th century, so did Flint. People from all over the United States moved to Flint to enjoy GM’s high wages and steady work. It was a booming GM company town.
Steve Casner, 78, grew up in Flint during these boom years. He met his wife, Rosie, while driving along the rust-colored bricks of Saginaw Street, graduated from Flint Central High School, then worked in a GM factory.
For him and other older white “Flintstones,” these were the glory days. While he was growing up, there were plenty of jobs in the area with good wages, quality schools, and little crime.
Douglas Knerr, a history professor at the University of Michigan’s Flint campus, said Flint natives like Casner often mention this brief shining moment when there was a real, strong, empowered middle class in Flint. But the entire community was built by and for GM’s labor force.
“When that went away, what replaced it?” Knerr said.
As sociologist Rick Matthews wrote in his dissertation about Flint, “When GM was doing well, Flint did well.” However, this also means that when GM wasn’t doing well, neither was Flint.
By the second half of the 20th century, General Motors was by far Flint’s biggest employer. In 1978, GM employed about half of Flint’s 160,000 residents.
Then, manufacturing companies began to favor offshore labor. In 1994, the North American Free Trade Agreement (NAFTA) went into effect. It limited tariffs on goods bought and sold between the United States, Canada and Mexico. NAFTA also made it easier for U.S. companies to use Mexican labor to keep costs down. In 1998, the New York Times reported that Mexican employees at a GM-owned company that made car parts earned $1 to $2 per hour. When GM employees in Flint made the same parts years earlier, they earned almost $22 an hour. As GM moved its suppliers across the border, it began shutting down factories in Flint.
In 2001, another factor accelerated GM’s restructuring. China joined the World Trade Organization (WTO), an international organization that regulates and arbitrates free trade agreements between countries. This allowed for more low-cost Chinese imports, and therefore more competition for American manufacturing companies, than ever before. “Cheap imports have been lethal for many American manufacturers, particularly in the midwestern rustbelt and in the South,” The Economist wrote in 2016.
Other parts of the country benefited from this increase in Chinese imports because it forced American companies to find new ways to lower prices in order to compete, according to The Economist. But Flint, which was dependent on one company for half of its jobs, suffered disproportionately.
Flint native Michael Moore, the controversial documentary filmmaker, went after GM’s chairman for a wave of plant closings in his 1989 project, “Roger and Me.” The film links the closings to montages of abandoned houses and scenes of families getting evicted from their homes on Christmas Eve. It also features updates on the lives of former GM employees — they became Taco Bell employees, plasma donors, prison guards and prisoners. One woman sold rabbits, offering them either as pets or as meat.
Flint has lost about 73,500 GM jobs since 1978 and over 113,000 residents since 1970. GM now only has about 6,500 employees in the city.
Despite the complicated relationship with its former biggest employer, the city still emphasizes its automobile manufacturing roots in museums and tourist attractions. Every year, Saginaw Street is closed for a classic car show that celebrates the city’s automobile-based heritage. It brings 500,000 car fans to Flint annually. GM is the event’s biggest sponsor.
At the Pitts’
As GM powered down in Flint, white flight was also causing the city to shrink. Cora and Hurbert Pitts, a Black couple who moved to Flint in 1978, experienced this first hand.
Cora Pitts waved at me from the porch of her red brick house on Odette Street through the snowflakes of a cold January day. Then, she ushered me inside, introducing me to her husband Hurbert and their squat bulldog. The house was small, but warm and cozy. Sunlight streamed through its many windows. I sat between them at their long wooden dining room table.
Cora said they bought the house in 1978 when it was part of a mixed-race neighborhood. The couple settled on this house knowing that they wouldn’t be shown anything better — Flint real estate agents refused to show Black people anything west of Dupont Street, where the houses were nicer. But when the time came to sign, Hurbert couldn’t get a mortgage. Even though he’d worked for several years before joining the Air Force and meeting his wife, the Veterans Association wouldn’t give him a loan because he had no credit history. A white veteran he knew in a similar situation had no trouble getting one.
Cora was no stranger to racial discrimination. At 13, she was one of seven Black students integrating a white South Carolina high school of 1,200. Still, she said, “It surprised me that there was so much more prejudice here.”
Flint’s prejudice was covert, sneaking. It came in the form of not being shown a house, not getting a loan. When the couple finally secured a loan and moved into their Odette Street house, white neighbors spread flyers amongst themselves that said, according to Cora, “Blacks are moving in, your property is going to devalue, you better hurry and move.”
At around the same time, Steve Casner’s family moved from Flint to its surrounding suburbs. Casner said he and his wife were attracted to the suburban lifestyle and the extra space it promised for raising their newborn. They also wanted to escape the inner city, where he said they worried about race riots erupting.
“There was a growing … racial animosity in the area,” Casner said. “And we didn’t want to have to deal with that.” He agreed that there was de facto segregation in Flint: “Black people largely lived between the Flint River and the main street of town, Saginaw Street.”
The Casners remembered leaving Flint as a personal decision based on space and safety. But as they watched their white neighbors leave one by one, the Pitts recognized it as a pervasive pattern of white flight. Cora said this white flight, which came at the same time as GM closed several factories in the area, was the start of a vicious cycle for Flint.
She explained that the cycle began when those flyers came and their neighbors would sell their house in a rush for less than it was worth, fleeing for the suburbs. The next owner then saw people moving away en masse and decided to leave, too, even if they suffered a financial loss. And the white flight cycle continued.
Cora said she has lived in other places with poor areas that still looked beautiful. In other words, she doesn’t think Flint’s problem is simply poverty — it’s the lack of community.
Knerr, the history professor, agrees that the diverse array of people initially attracted to Flint from all over the country had nothing to unite them after GM jobs dried up.
Only those who couldn’t leave remained. Around them, houses passed from hand to hand, then eventually were abandoned.
As Flint’s population shrank, so did its tax revenues. A housing study by urban planning experts reported that the tax revenue couldn’t cover the costs of systems “built for a much larger population,” so Flint struggled to adjust to its new, smaller size.
By 2002, Flint had a budget deficit of nearly $30 million, meaning the city government spent $30 million more than it made. Michigan’s governor declared the city to be in a financial emergency. In 2011, it happened again, making it the only Michigan city that has needed emergency takeover twice, according to the Flint Journal.
As a cost-cutting measure during the second takeover, the emergency manager switched Flint to a new water pipeline that was still under construction. In the meantime, Flint decided to treat and pump its own Flint River water.
That brought on the widely reported water crisis — the moment Flint became national news.
Soon after the switch in 2014, residents began to complain about the water’s strange taste, smell, and color. In the first month of its use, the city issued three water boiling advisories to Flint water users. GM stopped using Flint water in its plants. Still, city officials insisted that the water was safe to drink for everyone except infants, elderly, and those with a compromised immune system. In late 2015, the mayor finally declared Flint was in a state of emergency.
The water is safe now, but Flint is still one size too big for its current population. The city had almost 16,000 vacant homes as of 2020, and many more that were run down or tax-delinquent. Its shrinking problems are far from over.
The ownership of Flint homes now follows a new cycle: the foreclosed homes cycle. First, a homeowner dies and leaves their home to their children, grandchildren, or another relative. After a couple of years, that relative doesn’t have enough money to pay property taxes on the house. After two years of being unable to repay this debt, their house is foreclosed on. Then, another Flint resident buys their house at a low price in the tax sale. A couple years later, they too fail to pay property taxes. And the cycle continues.
Cherry-picked
When Deb Cherry, the Genesee County treasurer, packaged 230 foreclosed homes together to be sold in last year’s tax deed sale, she didn’t expect anyone to buy it — she’s been treasurer since 2010 and she can’t remember anyone ever buying a bundle of houses.
“There’s never really been an interest in these properties,” she said.
Almost 20% of Flint houses are vacant, according to the 2022 U.S. Census.
It’s not the only city in Michigan with this problem. The state has seen such little demand for this category of real estate since the early 2000s that legislators developed a specific legal framework to deal with the problem of these houses.
County treasurers like Cherry can foreclose on (i.e., confiscate) occupied properties that haven’t repaid late property taxes after two years. They can foreclose on vacant properties even faster.
Originally created in the ’70s to deal with vacant buildings in St. Louis, Cleveland, Louisville, and Atlanta, land banks allow local governments to acquire property, renovate it, then resell it to “new, responsible owners” according to the GCLB’s website.
Cherry, who is also the chairwoman of the GCLB, added that their goal is to “keep people living in their own home.” For example, the land bank might sell the foreclosed house to a relative of the previous owner who can better manage the property’s tax payments.
GCLB owns a third of Flint by Cherry’s estimate, and has reduced crime around the vacant lots it owns by 40%. Genesee County is well-known as a model for other land banks forming in the state, she said.
But treasurers can’t just give properties to the land bank — at least, not at first. Michigan requires treasurers to list foreclosed properties on the tax deed sale website for two consecutive auctions. If properties go unsold both times, the treasurer gains ownership of the home.
Cherry’s office then gives most of these properties to the land bank.
In the past, she’d bundle three different types of houses together: vacant houses, occupied houses and houses that needed to be demolished. For example, Cherry bundled 1,193 properties together in 2019, listed at a minimum price of $6.8 million. The bundle didn’t get a single bid — and that was the point. All the costs associated with demolition and environmental cleanup made bundles like these unattractive to investors. So by bundling, Cherry could be almost certain that properties she wanted to give to the land bank wouldn’t sell at auction.
She said the occupants of the bundled homes seemed like they could use the land bank’s help: “That was always a good way to deal with those [properties], to send them through the land bank, because the land bank could work with them.”
Cherry’s system — bundling hundreds of homes, listing them at a high total bidding price, then giving them to the land bank — worked like a charm. The bundles always went unsold.
Then, a group of previous property owners sued Cherry and five other Michigan treasurers in 2018 for giving their counties the profit (minus the back taxes) earned at state tax auctions instead of paying the original owners of each home. This made Cherry cautious about bundling too many homes together, and she began bundling each category of homes separately: one bundle for the to-be-demolished, one for the vacant, and one for the occupied.
She thought the large disparity in home values — some houses in the bundle were almost uninhabitable, like Hayes’, while others were in better shape — would dissuade investors from purchasing the occupied home bundle. But last September, it didn’t.
The other occupants
Virginia Hayes wasn’t the only person who was shocked to learn they had a new landlord last fall.
J.D. Smith told local news station WNEM he had paid off his house in 2016, only to fall behind on property taxes after his wife died three years ago. He thought he’d have a chance to get his house back. But then, it was sold and a representative of To Life (likely Asraf) knocked on his door asking for rent money.
Smith was shocked: “I said, ‘What are you talking about man? I’ve been here 30 years.’ He said. ‘Well, you don’t own the house no more.’”
Sa’Terica Simpson, a 33-year-old mother of two, told the Flint Journal she almost passed out when she learned her home was sold.
“I still feel sick to my stomach,” she said. “I can’t sleep because it’s a very horrible, horrible, horrible situation.”
Simpson said her great grandmother bought the house she lives in 55 years ago. Simpson thought that through the land bank, she’d find a way to continue living in her home. When To Life bought it instead, her future became much more uncertain.
“I wanted to buy my house. I don’t want to rent my house and have somebody else own my house,” she told the Journal. “I wasn’t prepared for this at all because I was told something different.”
Treasurer Cherry wasn’t the only local official distraught by the sale. Flint 1st Ward Councilman Eric Mays told local news site MLive that the sale “should serve as a wake-up call that changes have to be made in the current foreclosure system.” When the news first broke, Flint Mayor Sheldon Neeley passed a measure to spend $50,000 to provide the residents of these homes with help from local law firm Legal Services of Eastern Michigan. But the move seemed largely symbolic.
Legal Services attorney Brian Smith said, “It is difficult to try to explain to people that there isn’t much I can do for you.”
His colleague Kyle Lawrey added, “They’re coming to us thinking, ‘Oh, well, everybody’s told me this was wrong, you can save this,’” he said. “Then we have to explain to them that from what we’ve seen — we can’t.”
Smith and Lawrey said they’ve asked To Life’s lawyer, Jeremy Piper, if residents will be able to buy their homes back from the company. But even if To Life agrees to sell, some occupants might not be able to afford the asking price. Many in the bundle owed less than $1,600 — the amount of property taxes a house valued at $60,000 owes each year in Genesee County — yet couldn’t afford to pay it. One occupant whose home was sold in the bundle only owed $893 in unpaid property taxes, according to Lawrey.
Smith and Lawrey spend most of their time negotiating with Piper to get their clients more time to find new housing after they’re evicted. There’s some hope for occupants who aren’t the previous homeowner — who were renting the house or are relatives or friends of the previous owner, such as Virginia Hayes — due to a law that might help Smith and Lawrey get them 90 days to find a new place to live instead of ten.
Most of the homes are owner-occupied, however. For them, there’s nothing the lawyers can do.
Smith said news of the sale has exacerbated a feeling of us-versus-them in the Flint community. Because of the notorious water crisis and the distrust in state and local government that came with it, this feeling was already strong in Flint before To Life made headlines there.
“You have this non-Michigan, non-local entity buying up properties in the city, trying to make a dollar,” he said. “It just hits home with people… it’s just one more entity that’s trying to get one over on us.”
“Unfortunately, sometimes that’s the way the world works,” he said.
To Life Real Estate LLC
To Life has evicted 28 occupants as of April 2024, and they’re in the process of evicting 31 more. That’s a total of 59 residents in different stages of the eviction process with To Life, more than one-fourth of the initial bundle of 230 homes.
When Haim Azizy, the company’s manager, and Asraf, the company’s Flint representative, spoke to local news outlets in 2023 about the purchase, they said they’d work with residents as best as they could. Asraf told the Flint Journal he knows that many occupants, like J.D. Smith, Sa’Terica Simpson and Virginia Hayes, were surprised to learn of the sale.
“I’m trying to work with the situation so the ground won’t shake under people’s feet,” he said.
Azizy echoed that sentiment in an interview with WNEM about J.D. Smith, adding that, “You have to take into consideration that he no longer owns the house. Someone else owns it. And we have a responsibility of fixing it up and putting it back into a tax-generating property.” He said eviction decisions would be made on a case-by-case basis.
To Life Real Estate LLC was first incorporated in Florida in August 2021. This year, a week after their big purchase, it was also registered in Michigan.
Azizy is no newcomer to evictions. In Broward County, Fla., (where To Life owns a 15-unit multifamily residential building) he’s listed as a plaintiff in eight removal of residential tenant cases.
Legal Services of Eastern Michigan lawyers Smith and Lawrey, who haven’t met Asraf or Azizy, said they doubted that To Life fully understood what properties they were purchasing when they bought the bundle.
“I don’t think that they knew what they were doing,” Smith said. “They just knew there’s 230 properties, we’re going to become one of the biggest landlords in Genesee County overnight by buying this.”
After their big purchase, the company seemed to scramble. Their representatives reached out to both the GCLB and Habitat for Humanity shortly after the sale, asking to swap properties with the local non-profits, according to Smith.
Christina Kelly, director of planning and neighborhood revitalization at the GCLB, confirmed this. She said it seemed like To Life was surprised at the condition some of their properties were in, so they asked the land bank to take their “problem” properties in exchange for better ones. Kelly said Michael Freeman, the executive director of the land bank, declined this offer.
“That idea is so outrageous,” she said. “Like, why would we give them more profit?”
But To Life may know Flint better than Smith assumes. Asraf is far from a new face in town; in 2016, while Flint was attracting national attention for its water crisis, he bought 14 individual properties through the Genesee County tax deed sale according to county records. He no longer owns any of the houses.
One of Asraf’s purchases was a two-bedroom home on Copeman Boulevard. In September 2016, he bought the house for $5,400 (including the cost of back taxes) according to tax sale records and the county deeds registry. He then sold it in April 2017 for $11,000, a difference of $5,600.
Then, in 2020 and 2021, the man Asraf sold that house to failed to pay his property taxes. He eventually repaid them in May 2021 and still owns the house.
With Asraf’s help, To Life has now sold at least 24 of the 230 homes it bought last fall. All of these homes were sold through a land contract, a mortgage alternative where the buyer of a home pays the seller a certain amount of money each month until they pay off the house. Basically, land contracts allow the occupants who don’t qualify for a mortgage to slowly buy back their house.
To Life gave Joshua Pope Jr., who lives in one of the houses the company now owns, two choices.
“I could either come up with a large lump sum and pay rent until I own it or just pay rent,” he said.
He chose the first option and entered into a land contract with the company in January. When his house was foreclosed on, he estimates that he owed about $5,000 in property taxes. His land contract with To Life prices his home at $28,000.
Pope said he feels taken advantage of. If To Life’s true goal was to buy homes in Flint, renovate them, then sell them to new owners, there were plenty of vacant homes they could have purchased.
Instead, they “purchased the ones where people were having a hard time and tripled — no, not even tripled, like quadrupled — what you owe in taxes,” he said.
The deeds registry only lists the price of 17 land contracts. The average cost is about $26,000 per house. If To Life keeps this rate up, they’ll gross over $6 million. That’s about $4.77 million more than they paid.
Smith thinks there’s going to be two different answers to the question about To Life’s intentions in Flint. Short-term, what is the company going to do this September if Cherry stops bundling so many properties together in response to their big purchase? Will To Life stop investing in Flint when the properties are no longer listed at rock bottom prices?
Long-term, Smith asked, “What are they going to do with properties that they don’t see a market for? There is some possibility that there are properties that they will jettison back off to the county by just not paying the property taxes.”
“Might To Life surprise us? Sure. But they’re not starting out real well,” Smith said.“There’s sort of this… mystique around them that they’re not clearing up.”
To Life did not respond to multiple requests for comment.
‘The thing about Flint’
Flint residents wonder if more investors and prospective homeowners will now set their sights on Flint — and what that could mean for them.
According to Shelly Hoffman, the director of development for Shelter of Flint, a homeless shelter, this is not the first time small out-of-state investors have paid attention to Flint. After the financial crisis in the early 2000’s, “You would see regularly online, ‘You can buy this house in Flint, Michigan for $500!’” she said. “So a lot of our property did get bought up … by out of state investors seeing it as a potential investment just because it is so incredibly cheap.”
And it seems like To Life’s purchase has reignited this interest in affordable Flint homes. Christina Kelly, the GCLB director, helps translate for Spanish speakers who call the land bank. She said she’s already seen a change in the calls she receives there — people are calling her from Miami every day asking how to buy properties in Flint for themselves and their family members.
“I used to take like five Spanish calls a year,” she said. “And now I take at least one Spanish call a day.”
And it’s not just individual homeowners: “There are also investors from Miami that are buying up houses at a smaller scale and renovating for rental,” she said. These callers ask her about buying anywhere from 5 to 10 houses.
Will larger investors also follow To Life’s lead? Tim Savage, an NYU Schack Institute of Real Estate professor, said that institutional investors are indeed interested in residential markets right now.
He explained that these large investors have always put a substantial amount of money into real estate. In the past, they invested the majority of this in commercial real estate, like office, storage and shopping spaces, not residential real estate. But office real estate is still struggling because of the increase in remote work due to the pandemic, so investors are looking to invest in other segments of real estate.
“Capital that would like to flow to commercial real estate is not getting the returns, so now it’s going to flow to residential real estate,” he said.
As investors turn to real estate, more may consider buying in Flint and similar rust-belt communities that have low housing prices compared to the rest of the country, which Savage says is facing an affordability crisis. Still, Flint is unlikely to be their first choice city.
“Institutional investors tend to focus on cities that have the potential for strong job growth and a lack of housing supply,” an article by The Journalist’s Resource says. “Since the Great Recession, they have focused primarily on the Southeast and Southwest.”
Patrick Hayes, the professor, is worried about the negative impact To Life’s purchase will have on the Flint community.
“Here’s a more accurate descriptor for what Asraf and To Life Real Estate are inflicting on Flint: harm,” Hayes wrote in an editorial for “Flintside”, a local online publication. “This is actively going to harm people, and not just the people in those homes who now suddenly face an even more perilous housing situation than the one they were previously in.”
He blames the local government for offering such a large bundle of homes for sale. They were so focused on Flint’s hardships and lack of resources, he says, that they made a shortsighted decision.
“That element is very similar to what happened during the water crisis,” he said. “We made a quick decision that was hasty, but that got us out of an economic jam really quickly, and then once the long-term ramifications start settling in, it’s kind of like … what did we do?”
Mayor Neeley was more optimistic: he said that Flint wants investors because investment in Flint can improve the quality of life of current residents. If investors think they can make money here, that’s a good sign. Cherry agreed, saying this purchase shows that To Life is “getting some value at any rate, which hasn’t occurred in the past.” Still, the purchase made her reconsider how her office handles occupied foreclosed properties.
“One of the things that we’re looking at now is whether or not we’re going to bundle in the future,” she said. “That might not be the best way to handle this.”
Patrick Hayes said he’s glad the purchase finally led Cherry’s office to realize that this practice was devaluing Flint property: “This was a moment where they’re like, ‘Oh, maybe we should protect some of these assets a little better.’”
The long-term effects of the purchase still remain to be seen. If To Life does attract new buyers to Flint and raises home values in the area, that could benefit current Flint homeowners — but only as long as they can afford to pay their taxes.
Hoffman said that throughout its long history, Flint has been a leader in both good and bad things across the country. Because of this, it functions like a canary in a coal mine.
“What happens in Flint is kind of a foreshadowing of the rest of the nation,” she said.
“There’s just so much that can be learned from our city still,” she said. “I think that we serve as both a beacon and a warning.”