Why most Detroit rentals aren’t up to code — and how the city could fix that

Detroit’s approach to inspecting rental properties isn’t working. A new report offers a blueprint for fixing it.

The City of Detroit enacted its rental registry ordinance in 2017 to bring all rental properties up to code. It mandated that landlords register their properties then bring them into compliance through regular inspections, including lead remediation. Tenants rights activists hailed it at the time as a novel and good-faith effort to protect renter health and safety.

Few landlords have followed the ordinance , despite several efforts over the past six years from the city to entice or enforce compliance . There are about 124,000 rental properties in Detroit, but only around 10,000 — or a little more than 8% — have achieved full compliance.

If Detroit’s goal was to make housing safer for renters, it has barely made a dent.

A March report from the Center for Community Progress diagnoses issues with the ordinance and offers recommendations for the city to make it work. Authors Matt Kreis, Alan Mallach and Danielle Lewinski say it’s essential that Detroit gets it right because the city’s old housing stock can leave tenants in precarious, unsafe living situations .

They’re unflinching in their criticisms of the way the ordinance is currently managed but are optimistic the law can be fixed.

“If the City acts now, the new system can be up and running within a year, putting Detroit on a path to becoming a national model for rental regulation,” they write.

A spokesperson for the city’s Housing and Revitalization Department did not respond to a request for comment.

What isn’t working

The biggest problem with the ordinance is that it’s too expensive for most landlords to comply. Properties must pass a 37-point inspection that includes everything from having no graffiti or markings on the exterior to fences needing to be shorter than three feet.

The authors say the number of items is excessive and that not all these issues “rise to the level of fundamental health and safety matters.”

Meeting the ordinance’s lead requirements is even more difficult. Landlords must remove or contain the dangerous metal, both inside and out. They can do this through temporary measures like covering lead paint in additional layers of paint, but this route necessitates annual inspections.

Even with the option of what are known as “interim controls,” Detroit may have the highest standard for lead remediation in the country.

“To the best of our knowledge, no other cities require such an onerous inspection standard,” the report says.

Meeting these requirements is especially challenging in Detroit, where a combination of old housing stock and history of heavy industry mean homes are often filled with lead .

The authors estimate the average cost of temporary abatement from $2,500-$3,500 and full abatement at $35,000.

Repairs aren’t the only expenses landlords have to incur. There are several inspections, each costing around $1,000. It can take a couple of months to more than a year to reach full compliance. Meanwhile, landlords aren’t supposed to collect rent before they’ve gotten a certificate of compliance.

Landlords face a basic math problem when deciding whether to comply: Should they spend tens of thousands to bring a house up to code, or just ignore the law? Almost all are choosing the latter.

For compliance to make financial sense, the report says, a number of factors in Detroit’s housing market would need to change: There would need to be an infusion of billions of dollars for home repair, a dramatic decrease in construction costs, a sharp increase in property values or an increase in median income so landlords could charge more rent.

“None of these events are remotely plausible,” the report says.

It also makes sense for landlords to ignore the rules because there are few consequences for flouting them. The authors found that since 2018, the city has issued more than 100,000 blight tickets for not following the ordinance, and more than 45,000 of them are still outstanding.

How to make it actually work

The authors offer a number of suggestions to fix the ordinance. They say making the inspection process more achievable and streamlined should be the city’s top priority.

“It’s far better to get most of the properties to a good standard, where we’re getting rid of most of the problems, then to set an unrealistic standard of trying to solve all of the problems,” Mallach told Outlier. “Because if you do that, you end up solving very few.”

Instead of requiring all homes be free of lead hazards, inspectors should only do a visual inspection for most homes. That means looking at all painted surfaces for evidence of chipping, debris or dust. Inspectors can also be trained to identify signs of lead paint.

Inspectors could still conduct lead testing on homes that fail a visual inspection or are in census tracts with high rates of lead poisoning.

“Full abatement would be great. We would absolutely support every property being able to get to that standard,” Kreis said. “But what we found is that the cost of doing so, particularly in the older housing stock in Detroit, is not economically possible.”

Lyke Thompson, director of Wayne State University’s Center for Urban Studies, has studied the effect of lead poisoning on children in Detroit. He strongly opposes eliminating mandatory lead testing for rental homes.

“Part of the rental ordinance is about protecting children,” Thompson said. “And in order to do that, you have to eliminate lead dust.”

Lead dust is microscopic and pervasive, so a visual test alone is “virtually useless,” he said. He added that the city and state both offer incentives for lead remediation.

Beyond lead, the report recommends paring down the number of regular inspection items to 15 instead of the current 37. And all should be done under a single inspection that only has to be paid for once.

“Every time a landlord has to pay for another inspection, file a document with the City, or receive a document from the City,” the authors write, “it represents an opportunity for that landlord to decide that compliance is too much of a burden and walk away.”

Enforcement should also be more targeted. Just as it should be achievable and inexpensive for landlords that make good-faith efforts to comply, those that repeatedly fail inspections and actively ignore unsafe conditions should be held responsible.

The authors recommend increasing the cost of tickets on an escalating scale for repeat offenders and treating blight debt similar to delinquent property taxes: The city could place liens on properties and take them to court to compel payment or compliance, or seize the property if necessary.

The city could also include tenants in this process. If the city made its escrow payment program more accessible, it could help identify bad actors and potentially influence landlord behavior. The authors also recommend making the city’s rental registry data available to the public — including property ownership, compliance and blight violations.

Were the city to take up the report’s recommendations, the authors believe it might be able to fix the ordinance within a year. Actually getting a majority of Detroit’s landlords into compliance, however, would be a multiyear effort and require extensive outreach from the city.

“This is a long-term investment. It’s going to take time,” Kreis said. “But overall, we believe that if they put this general framework in place, they’re going to be more successful.”

Why most Detroit rentals aren’t up to code — and how the city could fix that · Outlier Media