Property Tax Foreclosure, Spatial Effects, and Neighborhood Racial Demographic Change: Examining Data From Detroit.

Karl Vachuska

doi:10.3389/fsoc.2021.598911

Abstract

In recent decades, the city of Detroit has experienced the greatest population loss of any major American city. Applying Event History Analysis methodology to a large dataset containing information on all properties in Detroit between 2002 and 2013, I examine how Property Tax Foreclosure spatially perpetuated itself in Detroit, finding evidence that the number of past but recent Property Tax Foreclosures in a localized area significantly predicts the likelihood of a future foreclosure. I extrapolate these findings to mathematical simulations and find evidence that suggests that initial Property Tax Foreclosures played a significant role in cascading many later on. Finally, building off past research that suggests neighborhood blight disproportionally affects white residential preferences and patterns, I perform an empirical analysis that examines how the initial distribution of Property Tax Foreclosures in Detroit neighborhoods played some role in determining how those neighborhoods have experienced racial demographic change.

Highlights

Detroit, Michigan, serves as an extreme example of a major American city whose property stock has been increasingly subject to vacancy and blight in recent decades
I extrapolate these findings to a larger scale, which suggests that a critical predictor of the longterm number of Property Tax Foreclosures in a neighborhood is how many initial Property Tax Foreclosures there are throughout the neighborhood
I perform an empirical analysis and find some evidence that the number of initial Property Tax Foreclosures and how dispersed they were predicted how neighborhood racial demographics shifted in Detroit between 2000 and 2017

Summary

Introduction

Michigan, serves as an extreme example of a major American city whose property stock has been increasingly subject to vacancy and blight in recent decades. If a homeowner in the state of Michigan has property taxes due and fails to pay property taxes for two consecutive years, a county treasurer notifies them that they are at risk of losing their property if the taxes for the third year are not paid by March 31st of the following year. If this requirement is not met, the home is put up for auction, with the minimum bid being the sum of outstanding taxes, interest penalties, and any liens against the property. A new homeowner must go to a court at least twice to obtain legal orders permitting them to enter and remove the previous homeowners’ person and belongings (Akers and Seymour, 2019)

Methods

Results

Conclusion