Feeling a little subprime

After the financial crisis of 2008 and the revelation that subprime mortgages were involved in the bubble, commentators intoned that we’ve just gone too far in America with everyone wanting to own their own home. This utter folly was attributed to (among others) George W. Bush.

When he came into office in 2002 he promoted an “ownership society” where owning a home would give people a stake in society.(1) Attractive to minorities, lucrative for big donors to the Republican Party and feasible for Wall Street under lax regulation, this was a “win-win” vision.

Then, lo! The financial debacle hit and exposed mortgage-backed securities — tranches of mortgages, bundles of bad loans to the highly unqualified new buyers. The shady subprime world was revealed.(2)

I’ve been following this drama. It’s infinitely more complex, riddled with arcane phrases and acronyms, packed with factors besides bad mortgages. Nothing rivets me to the TV screen like an interview with economists like Joseph Stiglitz or Paul Krugman. Or better yet, someone I can understand, like Sheila Bair.(3) And don’t get me started on the movies — Too Big to Fail, Margin Call or Inside Job.

I have a stake in this topic because I own a house that I love more than it’s worth. My love has grown as the market value has declined. It’s a healthy house from head to toe — with a new roof and a dry basement. Large windows face the sunrise. In its backyard I’ve learned how to grow roses that bloom from June to November.

In good weather my mother read for peaceful hours on its front porch, observed the school bus schedule, noted who got FedEx deliveries. And the house has a congenial setting — a neighborhood.

I’m new to the neighborhood idea. As a kid I lived on the hillsides of northern California. Only a few houses were visible. It was an unincorporated area, outside the city limits. Nobody lived “next door.” We had volunteer fire departments, septic tanks, dirt and gravel roads and sometimes in the summer, a random rattlesnake that a German Swiss neighbor killed with a shovel.

When you saw a neighbor, it was an emergency — for example, a finger severed with a scythe.

Later, I lived in a big city, on the top floor of a high-rise apartment building. I learned the nuances of nods and mumbles, the social forms appropriate to the elevator and the hallway.

After that, on Main Street in a small town. Everyone minded your business, knew what you bought at the local IGA, observed what you wore to church and commented on how you raised your kid. It seemed ingrown and insufferable.

Then, by accident, I came to live in Mott Park. But I didn’t understand its real value until the mortgage crisis of 2008.

The first Mott Park homes were built in 1921 along Flushing and Bagley streets. For the next decade houses went up along Frank, Dickinson and Monteith, then Altoona and Thomas. By 1933, private developers built Mott Park’s remaining homes, including those along Nolen Drive where the houses are larger and more architecturally complex and are situated on picturesque sites along the Flint River across from the Mott Park Golf Course.

Developers marketed these homes to the city’s elite by placing ads in society magazines. Varied building styles, curvilinear streets, public parks and many trees made the area attractive. Urban planning researchers have called Mott Park “a cornerstone American neighborhood community that represents the American dream.”(4)

Photos and reminiscences record this mid-20th century neighborhood in its heyday. Compiled by two former neighborhood residents, The Mott Park Chronicles shows happy 1950s families and children on the sidewalks going to nearby schools.(5) There’d be family car in the driveway (probably a Buick). It was a lifestyle of pride in ownership of a home that lasted several decades — precisely the years of President Bush’s youth.

When I bought a house in the neighborhood in 1995, the Fifties afterglow was still palpable, even though Flint had suffered in the decades-long decline of the auto industry. Now, 11 years later, in the wake of the 2008 mortgage and financial crisis, sharper signs of hardship mingle with new values and new ways.

Homeowners who could afford (and chose) to leave the neighborhood have moved away. Some left for typical reasons. Older folks retire. Even the dogs they used to walk die. Younger couples want better schools or more bedrooms as the kids grow up.

Others have left because of the unaddressed issues with crime and decline in safety enforcement. And still others were unable to keep their homes for financial reasons and simply abandoned them, increasing the number of vacant homes drastically.

On my walks I see that a house is suddenly empty. Through the glass of uncovered windows, rooms at the back of the house are visible. One week all seems normal. The next, people are just gone. How long did these people deliberate before decamping? Perhaps months of desperation were not visible to the Sunday walker.

Meantime, landlords looking to make a quick dollar and out-of-state investment companies have bought up homes in the neighborhood.

Already in 2008, 53 percent of homes were owned by investment companies, 29 percent were real estate owned and 16 percent were privately owned. Of those investors, 22 percent were out-of-state companies, 21 percent located in Michigan, 27 percent in Genesee County, 23 percent in Flint and 6 percent in Mott Park.(6)

My expectations have adjusted to reality. Fewer traditional property owners live here. New people live in a different world than those for whom these houses were built or the first generation of homeowners that followed them. New residents surely enjoy the freedom, fresh air and green expanses that still decent houses in a fairly good neighborhood provide.

But what former apartment dweller moves in with a lawnmower? The yard around the house, the paint and repairs are probably not the renters’ responsibility. Landlords do the minimum, often less. If people are buying on land contract, they can make payments, but not much more.

My unscientific calculation is that a single-family dwelling occupied by renters can last about two years before external decline becomes pronounced. A vacant house goes in a year. And some edges of the Mott Park neighborhood have gone beyond reclaiming.

A Genesee County Land Bank assessment charts the changing status of the neighborhood’s housing stock. A color-coded map of parcels rates the houses as good (rose), fair (pink), poor (violet), or structurally deficient (red).(7) You can see which properties the Land Bank owns and where the tax foreclosures are.(8)

I’m over the shock of the changes, visual ones mostly, and the loss of property value. I’ve discovered something else that seems to matter more. It’s tied to the neighborhood, just a bunch of people all in the same residential life boat. They have grit, like the workers who first lived in Mott Park. The Neighborhood Association is indefatigable. Its members trek on.

For five years or more, members have conducted monthly recycling that raises money to repair the park playground and patch the asphalt on the tennis courts. Volunteers hang new nets and repair fencing. Gardeners plant the neighborhood’s flower beds.

Another neighborhood group has incorporated as the Golf Course Association, a nonprofit to seek grants to maintain the golf course. A small grant funded a “neat street” project where residents adopt a street to keep free of trash. Joining Genesee County’s Little Free Libraries, Mott Park residents constructed four little libraries for kids in the neighborhood.(9)

In October about 30 volunteers from Kettering University, Calvary United Methodist and Mott Park residents joined forces to clean up the alleys behind Joliet and Chevrolet, as well as Bagley, Perry, Dupont and the surrounding areas. The Flint sanitation division helped by picking up an enormous trash pile.

The neighborhood’s Facebook page that holds all these efforts together shows how creative and energetic these neighborhood people are. Many are young, new to the neighborhood, and they have children.

When I drive through other distinctive neighborhoods in Flint, I’m amazed at how solid they still seem, those larger and more imposing houses of the College and Cultural Center or Woodcroft. My eye is canny, however. I know how much change can be hidden. Friends in those neighborhoods worry too.

The mortgage and financial crisis of 2008 on top of two decades of urban collapse has affected all Flint neighborhoods. As for Mott Park, the year 2019 will mark the centennial of its founding, of a historic commitment to the workers of America’s automotive industry. That industry and its workers are mostly gone, but much of their housing survives.

And the people in those homes are not subprime at all. 

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(1) Jo Becker, Sheryl Gay Stolberg and Stephen Labaton, “Bush drive for home ownership fueled housing bubble,” New York Times, December 21, 2008.

(2) After a two-year investigation by the Senate Permanent Subcommittee on Investigation, their report, Wall Street and the Financial Crisis: Anatomy of a Financial Collapse, was released in April 2011. It’s a free download on Kindle.

(3) Chairperson of the Federal Deposit Insurance Corporation (FDIC), 2006-2011.

(4) “Reclaiming the Neighborhood: Addressing Vacant Homes in Mott Park”. Prepared by Tara AuBuchon & Krista Trout-Edwards, University of Michigan Urban and Regional Planning. May 2009. As cited in Susan Burhans, “Mott Park Neighborhood Stabilization Plan,” Oct. 2, 2012.

(5) Cathy Snyder, ed. Mott Park Chronicles. The Story of an American Neighborhood. Historic Photos and Memories of Life in Flint, Michigan, 1908-2009 (Grand Blanc, MI: Grand Blanc Printing Company, 2009).

(6) Vacant Properties Survey; June – August 2008; City of Flint Assessor’s web site (Aug. 31, 2008), as cited in Susan Burhans, “Mott Park Neighborhood Stabilization Plan” [working document], Oct. 2, 2012.

(7) Genesee County Land Bank, Mott Park Housing Condition Assessment 2012, Nov. 7, 2012.

(8) The Land Bank owns five properties in Mott Park: two have been completed rehabbed; two have rehab in progress, and one is a pending sale. Buyers just need to qualify for a mortgage. The payments are cheaper than rent. See http://www.thelandbank.org/ Accessed Nov. 2, 2012. The Land Bank was established in 2002 after a 1999 Michigan tax law change.

(9) See https://www.facebook.com/MottParkLittleFreeLibrary. Accessed Nov. 8, 2012.

Read more essays like this in East Village Magazine at http://www.eastvillagemagazine.org/