By JARED WHITLEY
Mat Ishbia is building his dream home in Michigan, and he’s tearing down five other homes to do it. It’s a display of extravagance that has housing advocates and social justice activists looking askance.
At a time when Michigan is expected to lose thousands of affordable housing units over the next few years, particularly in the hard-hit Detroit area, the United Wholesale Mortgage CEO is building a 60,000-square-foot mansion in the Motor City suburb of Bloomfield Township. To build his 14-acre estate, Ishbia is tearing down his current 22,000-square-foot house, which is just eight years old, as well as five neighboring homes.
Once completed, the Ishbia compound will include a trampoline park, reflecting pool, statues, tennis court, and even an “Enchanted Forest.” (Video of the construction is available here.)
Critics see the irony of a CEO who has gotten rich on mortgages tearing down homes in a display of extravagance.
“The concentration of wealth in the hands of multimillionaires and billionaires is having a disruptive impact on our societies, especially with housing,” Institute for Policy Studies fellow Chuck Collins told The Mortgage Note.
According to the Federal Housing Finance Agency, the Wolverine State is already 37 out of 51 in the nation for housing affordability. The National Low Income Housing Coalition estimates Michigan is short more than 190,000 rental homes for extremely low-income renters.
Meanwhile, Isbhia – with an estimated net worth of $6.9 billion – is Michigan’s fourth-wealthiest individual, according to Forbes.
It’s also notable that Ishbia’s purchase comes at a time when soaring mortgage rates are putting home ownership beyond the reach of many average-income Americans.
“Applications for home purchase mortgages dropped to their lowest level since April 1995, as homebuyers withdrew from the market due to the elevated rate environment and the erosion of purchasing power,” Joel Kan, MBA’s Vice President and Deputy Chief Economist, reported in August. “Low housing supply is also keeping home prices high in many markets, adding to the affordability hurdles buyers are facing.”
And tearing down homes amid a housing supply shortage when would-be homeowners are desperately seeking affordable homes for sale isn’t a good look either, housing advocates say.
“The ultra-wealthy are buying up property and bidding up the cost of land and housing for everyone else, leading to displacement, shelter poverty, and an increase in unhoused people,” Collins continued. “Mega-mansions like Mat Ishbia’s are extravagant wastes of energy, resources, and construction capacity that would be better served building affordable housing for people to live in year-round.”
The news about Ishbia’s massive new home quickly spread among the current and former UWM employees online on Pillar7, the subreddit they use to vent their frustrations about working conditions. Ishbia’s been plagued by investigations and lawsuits over UWM’s treatment of its workers.
This post summarizes how many view the situation:
Although the local zoning board unanimously approved his application to build, Ishbia still needs to obtain the necessary permits for the project. According to USA Today, he’s already been forced to shave a few feet off his proposed 14-foot-high climbing walls (they’ll come down to a modest 10 feet) to comply with zoning regulations. The paper added that the subdivision’s HOA has been grumbling, too, and even made “veiled threats” of legal action.
According to reports, it could take up to a year for Ishbia to get all the permits for his palatial estate in order. Over that time, the housing market could continue to struggle, and this “Enchanted Forest” home could become a PR nightmare for UWM and its CEO.
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