How Detroit’s comeback inspired Kamala Harris’s housing plan

Marine Corps veteran Darryl Williams had never owned a home. For the past few years, he was renting in a subsidized apartment complex in Detroit. While he only paid $352 a month, there was constant loud music and chatter, and he felt like an outsider. He craved his own space. “The area you are in tends to [define] what you can do,” he says. “You’re controlled by your environment.”

But at the end of September, he became a homeowner for the first time. He moved into a newly remodeled house on a quiet street, around the intersection of 7 Mile Road and the I-75 highway. “It’s a beautiful home,” he says.

Williams, 72, was able to do this in large part because of the city’s down payment assistance (DPA) program, without which he says, “I don’t think it could have been as simple, economical, or timely.”

The Detroit program, part of Mayor Mike Duggan’s wider plan to address affordability, launched last year. It has so far helped more than 400 first-time homebuyers, strapped for funds otherwise, get keys to their own homes. It has been so successful that Kamala Harris has modeled her own DPA program—a major part of her housing plan—on Detroit’s.

How Detroit’s program works

Launched in March 2023, the first round of Detroit’s DPA program comprised a $12 million fund—from federal American Rescue Plan Act dollars. It gave 434 first-time homebuyers up to $25,000 to buy a house.

Julie Schneider, director of the city’s Housing and Revitalization Department, says most people who wanted to buy a home earned enough to be approved for a mortgage and afford the monthly payments, but the biggest barrier was the down payment, when many people had less than $3,000 in cash assets.

Others may have been able to afford cheaper, fixer-upper homes, but those can be money pits in the long run. The $25,000 DPA was intended to grant them access to a slightly higher tier of properties. The average price of homes bought by DPA users has been $112,000, higher than the city average of $95,000.

While most states and some cities have DPA programs—there are more than 2,000 nationally—they are often much smaller in size. (Philadelphia, for instance, offers $10,000.) Many of the more generous ones are structured as loans to be repaid, as in Seattle, or require buyers to contribute a share of the payment from their own savings, as in New York.

Detroit’s is designed to be a lot more flexible. It can be applied to closing fees and interest rate buydowns; and users can stack other assistance on top of it, including $10,000 available from the state of Michigan. But buyers must meet the income limit guidelines (below $45,000 for a single person and $61,000 for a couple).

The second round of the program launched in June to help another 300 families. It has been exceedingly popular. “Many families in Detroit didn’t even think that this was real,” says Dina Harris, founder and CEO of National Faith Homebuyers, a HUD-certified agency chosen to administer the Detroit program. Harris has processed DPA programs since 1996 in 40 cities across Michigan, and until now, the largest program she’d seen was roughly $15,000.

It has helped people including Williams, the veteran. “They treated me really, really human,” he says. “This experience has been wonderful. I’ve been blessed.”

He says his $75,000 home isn’t in the “best-looking neighborhood,” but it’s in a section that’s well-kept and on a one-way street, with neighbors his age. He has a big backyard, and a convenient private entrance from an alley. “I feel real comfortable here,” he says.

Williams used to run a home improvement business where he worked on other people’s houses. “Now I have one of my own,” he says.

How Harris’s plan would look

Detroit’s program has had such early success that Kamala Harris modeled her own DPA plan on it; Mayor Duggan says the campaign consulted with the city. Gene Sperling, now a senior economic advisor for Harris, ran Biden’s American Rescue Plan and oversaw the launch of Detroit’s DPA.

Trump, meanwhile, mocked the city while giving a speech at the Detroit Economic Club, saying the whole country would end up “like Detroit” if Harris wins. (Her campaign has put those disparaging comments in an ad running in Michigan.)

Housing experts are pleasantly surprised that the issue has become so central this election cycle. “That hasn’t been something the federal government has gotten involved in since the booms in the post-war era,” says Daryl Fairweather, chief economist at Redfin, a national real estate broker. She thinks it’s a smart move. “In our own polling, we see that housing is the big reason why people feel sour about the economy.”

While Harris’s housing plan is multifaceted, DPA is a key part. It would provide $25,000 for all eligible first-time homebuyers, aiming to help 4 million buyers in four years. Though the eligibility criteria isn’t yet available, it’s an expansion of the plan President Joe Biden proposed at this year’s State of the Union, which was for 400,000 first-generation buyers. (That plan stalled in Congress.)

The question is whether a program built for Detroit would work on a national level, given that the city has such a unique housing history. In recent years, Detroit has become known for its blight. The abandoned homes, an estimated 80,000 in 2014, were a symbol of the Motor City’s decline.

The dilapidated homes made neighborhoods unsafe and unattractive, deterring investment in the city, and displacing families. “Billions of dollars in generational wealth were lost,” says Darnell Adams, VP of Detroit Community Initiatives for the Gilbert Family Foundation, a private nonprofit.

Over the last 10 years, Detroit has demolished more than 25,000 blighted homes, and rehabilitated or sold 17,000 through a public-private program, Rehabbed & Ready. Vacant lots and revitalized homes are then transferred to the Detroit Land Bank Authority, the biggest land bank in the nation. In 2023, voters approved Mayor Duggan’s $250 million plan to continue eliminating the blight.

The boost in housing quality, along with recent economic growth, has made Detroit a buyer’s market. There has been net migration into Detroit for the first time since 1957, including from cities like New York and Washington; the city gained 2,000 residents between 2022 and 2023.

At the same time, revitalization creates affordability issues. Detroit housing is still far more affordable than most U.S. cities, but prices are increasing, and in a study this year, the city’s homes were rated the most overvalued in the country. Out-of-state arrivals lock out native Detroiters who’ve never owned a home, and many can’t compete with cash buyers, when the city’s average income is $36,000.

That’s why the DPA only qualifies people who’ve been in the city for a year, or had a home foreclosed between 2010 and 2016. The focus is on building generational wealth for native Detroiters—especially Black Detroiters, like Williams, in a city that has the largest share of Black residents, about 78% of the population. Almost 94% of the DPA’s first-round participants were Black. “These are long-time Detroit families who we want to see stay here,” Duggan told Fast Company.

“When you have that stability, it can change the trajectory of an entire family,” Adams says. “If we don’t allow economically vulnerable families to acquire assets like a home, we’re not really doing much to support America’s growth.”

Harris has said she wants to bring that stability—and long-term wealth—to the Black Americans across the country. Recent polls have shown Donald Trump is gaining on Harris among Black voters, particularly Black men, with a fifth intending to vote for Trump, a higher percentage than in 2016 or 2020. In response, Harris released an economic plan for Black men, which notes that the DPA program is intended for people “who lack inherited wealth,” and would allow the rate of Black homeowners to triple annually.

But not all cities are Detroit. David Dworkin, president and CEO of the National Housing Conference, a nonpartisan coalition of housing leaders, says Detroit’s program is so successful in part because the amount they’re providing is material to housing costs in the city. “$25,000 in Detroit has a lot of impact,” he says. “$25,000 in San Francisco would have almost no impact.”

Still, many cities do fit Detroit’s template. “I certainly think it’s a tool that can be useful throughout the country,” Schneider says. “Not every market is the high-priced coastal markets.” Fairweather adds that it could work in similar Rust Belt cities that have existing housing stock, as well as in markets where it’s easy to build, like the South.

How a national rollout could work

But experts say DPA alone would continue to increase demand, raising competition—and prices. “When supply is restricted, increasing demand doesn’t do anything to help affordability,” Fairweather says.

Harris is also targeting supply, proposing to build 3 million new units across the country in four years, through tax incentives for starter-home builders, and a $40 billion federal fund to empower local governments to innovate on homebuilding. That would address the national shortage of housing units (which may be closer to 7 million).

Detroit has been ramping up its supply, most notably by renovating its existing housing stock through the Rehabbed & Ready program. There has been bipartisan support at the national level? around a housing supply bill, the Neighborhood Homes Investment Act, which would provide tax credits to programs like Rehabbed & Ready, which Dworkin says would be impactful in a number of cities and in rural red states.

But there may be less congressional appetite for DPA, given Republicans’ resistance to increased spending. Congress “might scoff” at the $25,000 amount, Fairweather says, particularly if the total price tag for the program, intended for 4 million people, comes to $100 billion.

If it did pass, it’s hard to know how it would roll out. “There isn’t that much precedent for the federal government getting so involved in local planning of housing,” she says, adding it could be administered federally, like a stimulus payment, where buyers in escrow are sent a check.

But Dworkin says it’s best to leave it to local municipalities to administer. “Anytime we have to create a new federal infrastructure, we’re talking about years of delay,” he says.

Dworkin says it would be most effective to empower successful local programs—like Detroit’s—that are low in cash. Detroit’s second round of DPA has less than half the original funding, at $5 million, and is relying on a number of partners. But it knows what it’s doing, and is “shovel-ready,” he says.

So if Harris is elected and implements some version of her plan, Detroit could be an early winner. “If we can help 1,000 people achieve a dream of homeownership, do we really care where they are, when they’re all equally in need?” Dworkin says. “Ultimately, we’re all Americans.”