NEW REPORT: $7.5 Million for Demolition Preserves over $30 Million in Home Values
Jackson, Michigan used the U.S. Treasury's Hardest Hit Fund, part of the Troubled Asset Relief Program (TARP) and administered by Michigan State Housing Development Authority (MSHDA), among other sources, for demolition of blighted homes. A report by Detroit-based Dynamo Metrics showed $7.5 million in demolition preserved over $30 million in neighborhood home values. More information at www.demolitionimpact.com.
JACKSON, MI - 04/27/2017 /EASY NEWSWIRE/ — A report released today by the Detroit-based data analytics company Dynamo Metrics LLC, shows 612 demolitions conducted by the city of Jackson over the last five years preserved $30,177,684 in home values across the city.
Since early 2012, Jackson has aggressively demolished condemned and city-owned nuisance houses. Initially using general revenue funds, Jackson later used funding made available from the Community Development Block Grant program, the Neighborhood Stabilization Program, and U.S. Treasury’s Hardest Hit Fund. Jackson spent $7,507,085 for 612 demolitions between 2012 and 2016. The average demolition cost $12,266.
Dynamo Metrics estimates that this investment preserved $30,177,684 in neighboring home value, highlighting $4.02 in preserved home values for every demolition dollar spent.
To establish these estimates, Dynamo Metrics used spatial econometric modeling to identify how much worse neighborhoods with distressed houses are compared to vacant lots. On average, a distressed house near a home reduces the home’s value by 2.07 percent. A nearby vacant lot, on the other hand, reduces a home’s value by only .58 percent. By turning a distressed house into a vacant lot through demolition, roughly 1.5 percent of the nearby home’s value is preserved.
Jackson has consistently targeted the worst nuisances for demolition – houses that were both condemned as dangerous, and tax foreclosed.
“It is common knowledge that vacant and condemned properties are bad for neighborhoods,” Jackson Mayor Bill Jors said. “They are magnets for crime and lower property values. Now we know just how much home values are negatively affected by surrounding blight and distressed structures. “Our long-term strategy of blight elimination is literally paying off,” he added.
The Jackson demolition study was made possible by a collaborative, data-sharing exercise amongst various city departments and the Jackson County Treasurer. Dynamo Metrics created an innovative data system from various government sources.
“City leaders can now better understand the financial impact of their target investments,” City Manager Patrick Burtch said. “Data-driven decision making is imperative, and firms like Dynamo Metrics affords us the ability to predict outcomes of program initiatives.”
Dynamo Metrics has conducted similar studies for Detroit, greater Cleveland, and the Ohio Housing Finance Agency. These studies have consistently demonstrated that vacant and abandoned houses depress neighborhood values, and blight removal protects property values and homeowner equity.
“Our investigation in Jackson shows that blight removal does not only benefit big cities like Detroit and Cleveland,” said Nigel Griswold, managing director of Dynamo Metrics and principal investigator of the Jackson report. “Cities of any size can improve their housing market dynamics by eliminating nuisance properties.”
The results of the Jackson demolition report are available on an interactive website at www.demolitionimpact.com
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Media Contacts:
Company Name: Dynamo Metrics LLCFull Name: Nigel Griswold
Phone: (231) 709-3461
Email Address: nigel@dynamometrics.com
Website: www.dynamometric.com