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Carlos Osorio/AP
Local investors Anthony Pierson, left, and Henry Suell look over the house they purchased
for $8500 in Detroit.

With Houses Under 10K, Detroit Is a Landlord’s Dream

March 13, 2009 12:30 PM
by Haley A. Lovett
Detroit once had one of the highest owner-occupied rates in the country; absentee landlords now buy $10,000 houses in bulk.

Investors Buy Inexpensive Detroit Homes in Bulk

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With nearly 2,000 homes on the market for less than $10,000, Detroit is seeing an influx of real estate investment. According to The Associated Press, though one of the largest cities in the United States, “Detroit now has the lowest ownership rate for single-family detached homes.”

Statistics gathered by Realcomp and reported by the Chicago Tribune indicate that in December the median price of a home sold was $7,500. In February, according to the Detroit Free Press, that number dropped to $5,737. This trend isn’t a new one; nearly two years ago, findingDulcinea reported that Detroit’s home prices had hit rock bottom.
Sales in Detroit increased in February by 16.5 percent, according to Realcomp statistics reported by the Detroit Free Press. Some see this as the low point for home prices. Reginald Perryman of the Detroit Association of Realtors told the Free Press that because of the low prices of homes in Detroit, “the days on the market for those properties are a lot shorter.” A few realtors have reported investors purchasing dozens of homes at a time.

In some cases, new owners are hoping that by purchasing the homes and fixing them up they can help revive the area. “We just want to invest into it and bring the neighborhood back,” Henry Suell told the AP.

Related Topic: Detroit’s population loss; vacant land

Over the last 50 years, Detroit has lost nearly half of its population. Currently there are more than 50,000 houses on the market in the metro area.

The 138-square-mile city now has lots of vacant land, and in November of 2008 the city passed a Neighborhood Stabilization Plan that will allow some abandoned homes to be knocked down for development. One company, Urban Farming, has turned almost six acres of land into urban farms to help produce food for the shrinking city.
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