Want to buy in Detroit - suggestions? (Wyandotte, Harper Woods: section 8, foreclosed)

[bevk23]

Hi all,

I am following the Detroit threads with some interest.

My hubby and I are Australians who will be moving to North America next year and are interested in buying some property/ies in the Detroit area (partly as investments, partly to help stabilise/revitalise neighbourhoods).
We would like to buy homes which we can tenant out to the regular public ans possibly Section 8 families.

We get a lot of info here in Australia about how bad things are, especially in cities like Detroit which have been hit very hard by the GFC. Articles here tell us that Detroit is like a ghost town and that a massive amount of the population has moved away (not good when we're looking for tenants!).

I am interested in hearing from you guys who actually live there.
Are people moving back to Detroit? Is there job creation of some kind? Is there a shortage of quality rental units etc.

Thanks!

[Retroit]

I won't address this to you in particular, but just in general to all the people who have never been to Detroit before and are considering buying property here for investment, rental income, or charity.

First of all, not everyone in the metro Detroit area is poor. Many of us have money and could easily buy property in Detroit for the reasons mentioned above. However, there is a very logical reason why we haven't, and it's not because we are naively missing out on a great opportunity. It is because we know why Detroit is a "ghost town" because we live here and understand the dynamics involved. Unless and until you become thoroughly familiar with Detroit, I would strongly recommend you proceed with great caution. Notice, I am not saying you should never invest in Detroit, I'm just trying to warn you as someone familiar with Detroit that it is probably not as easy as you are thinking it could be.

Just for illustration, I had an uncle that owned several properties in Detroit. He told many horror stories about difficulty in collecting rent (he had three guns for this purpose alone) and tenants trashing or burning down his properties (actually, he didn't mind the arson so much because at least he was able to collect insurance on it, although I'm sure he would have preferred stable income). Over time, his properties dwindled to just one, and he was so grateful to the dependable elderly black woman that lived there, he simply gave the house to her and got out of the landlord business altogether.

And now, I'll turn it over to ForStarters who will tell you about all the great investment opportunities in Detroit.

[snoopygirlmi]

I'd visit Detroit before investing in rental units here. Some people love it the city and are trying to rebuild it. Some people are just not nice people and are the reason why Detroit ends up on "the most dangerous places" lists. It really varies by street and district what type of housing and people you'll find. Retroit has a lot of good points.

More power to you if you can make investing in Detroit work for you; however, as Retroit said "Many of us have money and could easily buy property in Detroit for the reasons mentioned above. However, there is a very logical reason why we haven't, and it's not because we are naively missing out on a great opportunity. It is because we know why Detroit is a "ghost town" because we live here and understand the dynamics involved."

Good luck to you whatever you decide.

[bevk23]

Thanks Retroit for your insight.

For those of us from overseas, Detroit is such a wild card. There are those who encourage development/investment and others who tell you to avoid the city like the plague!

I heed your call about proceeding with caution - when we get over there next year, we will spend some time getting to know the city and if we purchase anything, we will employ property managers who carry a big stick!

[rdub1968]

You might also consider looking in the suburbs of Detroit too, there are a lot of good deals there.
Since a lot of people foreclosed on their homes, they aren't able to buy their own home and will have to rent.
Plus the clientele you would be working with might be a bit more 'responsible', for lack of a better term.

[Coldjensens]

I live here and work downtown. If I had some money to spend, I would buy in Corktown or in Boston Edison (or maybe Indian Villiage, but no real bargains there).

However:
1. I am right here to manage and watch over the property.

2. I can fix things myself.

3. I can sue people for free if necessary.

4. I would like to have a couple of houses downtown to make available to my kids after they graduate from college and I think it wodl be neat to live downtown as long as things stay the same or get better. I think that things will get better and a house in a place like corktown will be very valuable. If they get worse, I would lose my investment.

[bevk23]

Thanks guys for your feedback. I'm still quite keen to explore my purchasing options, so it is good to hear both sides of the coin (so to speak).

Your property taxes are a real downer though!

[thealohaman]

Check this one out: Consider the Downriver area. Wyandotte is probably the hub of the region: www.williamschiropractic.blogspot.com
This link has nothing to do with chiropractic. It is a promotion of the City of Wyandotte and of a property that's available there.

[bevk23]

Thanks thealohaman for the info. I have had a look and it seems promising.

[scolls]

If you are looking for just purchasing a rental, try Harper Woods. I've actually made good money on my house. Bought it in 2008 for $28,500 and just sold it to an investor for $50,000 cash. This is a good area to rent because a lot of section 8 people from Detroit are moving into Harper Woods because a small section of Harper Woods is in Grosse Pointe school district. Homes are cheap and there is a market to rent them. I really had no interest to rent so I just decided to sell since I could at nearly a 40% return.