If you haven't noticed Detroit housing is a national media subject. They love talking about $100 Detroit homes for sale or that Detroit is becoming "landlord land". And they are right much of Detroit housing is becoming owned by investors.
There are investors buying Detroit homes cheap from all over the country and all over the world. They believe that can make a lot of money renting homes out from out of state and out of the country. I believe they will be in for a rude surprise. Being a landlord in any state takes time and some experience.
The Detroit housing market has unique issues that a lot of out of state and out of country investors don't realize. I think after a couple of years we will see many investors flee the Detroit housing market. The high taxes, the inability to consistently rent the homes and then to be able to collect rent will become issues for these foreign investors.
I wish I could be on the phone line when the management company calls them for funds to replace the stolen furnaces, hot water heaters, or copper plumbing. Yes thieves remove anything valuable from a Detroit home if the home is vacant. I believe the City of Detroit is going to have some major issues in the future from these "foreign" investors. I think what is going to happen is that some of these investors will give back these homes to the city for taxes. Some of them will owe more on taxes than the house will be worth after being rented or vandalized. Wait until the first tax bill comes and the tax bill is more than what they paid for the home. Many of investors have no clue what they are in for. Buyer beware is definitely key in Detroit home buying.
I can imagine their frustration when they realize that not everything is as it appears to be. That they have been sold a bill of goods by the national media. It's hard to make money as instate and hands on investor in Detroit. Let alone think you can make money from out of state and out of country. But we do appreciate you sending your money here.
As I say there is money to be made in Detroit homes if you buy smart.
Russ Ravary your Metro Detroit Realtor
Search Metro Detroit foreclosures
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Russ... I always read your blogs with great interest and you're smack on the money with this one. Detroit is a city that's on the ropes these days. It's gone through boom and bust cycles before and I believe if the city administration ever gets it's self straightened out it will rise again. Detroit needs a change of attitude at the highest levels. Diverisfication away from the auto industry, land planning and diminished egos on city council will lead to a brighter future. The city has much to offer, but it all starts at the top with outstanding state and local planning. We're still waiting for that to happen.