Debated house remodel in St. Clair Shores nets city $46,000 profit

By: Kristyne E. Demske | St. Clair Shores Sentinel | Published December 6, 2017

ST. CLAIR SHORES — After putting $100,000 into it, a house rehabilitated by the city on Ursuline has sold for more than the asking price.

The house, in the 27000 block of Ursuline, was part of the 2016 Tax Foreclosure Program and needed extensive work, according to Community Development and Inspection Director Chris Rayes. A living room addition on the house had made one bedroom uninhabitable by eliminating the egress window required, and so the city had to remodel the home’s interior, as well as fixing damage from the prior homeowner. The city turned the living room into a master bedroom by renovating the unusable bedroom into a master bathroom.

The house was listed for $186,000 and, after a dozen showings, Rayes said that an offer of $192,500 was received, giving the city a profit of $46,000, despite the $100,000 spent to repair the home. 

The original bid to renovate the home was for about $88,000, but the house unexpectedly required rewiring, which added to the costs of the renovation.

City Councilman Peter Accica said that he thought the extra costs were worth it.

“By putting the extra money into it, we made extra money,” he said at the Nov. 20 City Council meeting where the sale was debated. “It really turned out nice.”

Councilman Chris Vitale agreed. 

“This was exactly the intent of the program. They do seed the neighborhood,” he said of the rehabilitated homes, adding that the purchase offer was “almost like getting back to 2007 days.”

“Good job, Chris. Your design to redo that middle bedroom really saved this project.”

Other council members were concerned with the additional spending, however.

“What concerns me is we spent $24,000 more than we planned on,” Councilman Peter Rubino said. “When you increase the price of the job 25 percent, we should have some say in it.”

City staff is supposed to come back for council approval if a job goes more than 10 percent over budget, he said. 

“That is the problem in a nutshell. You can’t just do whatever you want,” he said. “Just because it fits your narrative doesn’t mean that you can spend $24,000 without council approval.”

City Council should be notified of the change before the renovations are complete and a purchase offer is in hand, Councilman John Caron said. 

Councilwoman Candice Rusie took issue with the extensive renovations, as she did in April when the bid was first awarded on the project.

“We go overboard,” she said. “Not only do we hit HGTV show standards, we make half the shows look like amateurs, according to the listing ticket.”

Vitale said the point of the program has always been to drive up house values and inspire residents to work on their houses as well. 

“They feel the confidence to improve their own house,” he said.  

He said that since the program has made more than $900,000 since its inception, “we’re obviously doing something right.”

Rusie, however, said that nearby residents wouldn’t necessarily have $100,000 to invest in home improvements.

Council voted 6-1 in favor of the sale of the house, with Rusie opposed.

“This has been a wildly successful program,” Mayor Kip Walby said.