UK folks buying up Detroit Houses (RR)

The_NonThe_Non 5,690 Posts
edited March 2009 in Strut Central
UK folls buying up housing in Detroit. Could it be a Northern Soul conspiracy? This whole thing makes me concerned for the residents of Detroit.
«1

  Comments


  • BurnsBurns 2,227 Posts
    Could it be a Northern Soul conspiracy?

    haha, I think the Japanese own the majority of real estate in South Beach if I'm not mistaken. vacation home related.

  • GrafwritahGrafwritah 4,184 Posts
    UK folls buying up housing in Detroit. Could it be a Northern Soul conspiracy? This whole thing makes me concerned for the residents of Detroit.

    Is this like the people who buy Detroit houses on ebay for $5k and don't understand the houses have no systems, roofs, and 35 liens on them?

    And what would be the attraction in owning real estate in Detroit? Not that its unfathomable, but I would think UK folks would want some nicer weather.

  • cpeetzcpeetz 2,112 Posts
    The median price dropped to $7,500 recently .
    I tripped out when I saw that.

    More info here:

    http://www.usnews.com/blogs/the-home-fro...ps-to-7500.html

  • They should grip that Highland Park property!!!

  • LokoOneLokoOne 1,823 Posts
    I would think UK folks would want some nicer weather.

    Yeah but their standards are very low when it comes to 'nice weather'. If 'nice weather' was a chick UK heads could happily F*ck a 3 and brag about it....


  • SoulhawkSoulhawk 3,197 Posts
    huh?

  • GrafwritahGrafwritah 4,184 Posts
    I would think UK folks would want some nicer weather.

    Yeah but their standards are very low when it comes to 'nice weather'. If 'nice weather' was a chick UK heads could happily F*ck a 3 and brag about it....


    Yeah but still... that's like... you don't see people from Canada buying vacation homes in West Virginia just because the weather is better by comparison.




    Better question, who said people from the UK are snapping up houses in Detroit? Was this an article somewhere?

  • The_NonThe_Non 5,690 Posts
    Long, but skimming suffices.

    Outside buyers drawn to Detroit's foreclosed homes
    By JEFF KAROUB and COREY WILLIAMS

    DETROIT ??? Welcome to Landlord Nation, where foreclosure notices are plentiful and for-sale signs offer at least 1,800 homes for under $10,000 that once were worth at least 10 times more.

    In extreme cases, homes are on sale for $1 or less, which has enticed investors to Detroit from as far away as the United Kingdom and Australia.

    "In the past few months, I've picked up 10 new clients from out of state that are buying in bulk," said Mike Shannon, a suburban Detroit real estate agent. His office specializes in foreclosures in a city that's among the national leaders.

    "They're coming to us, saying `Look, I want to buy 50, 100, 1,000.' They want to own every decent and cheap house they can find."

    Despite a stagnant retail housing market, real estate sales of foreclosed homes are booming. Shannon regularly fields calls from eager prospects, and recently sold 30 homes in one day to one buyer. A trio of U.K. investors has bought a half-dozen and plans many more.

    "I thought it would be quite good fun to have a look," said Darren Veness, who lives near Brighton, England.

    Outside buyers are the latest in a long line of landlords taking over the deteriorating housing stock of a city that because of its once mighty auto industry boasted one of the highest owner-occupied housing rates in the U.S. And unlike many large cities, Detroit's single-family homes dominate its landscape, not high-rise apartment buildings.

    The outside investors aren't only interested in Detroit, but it's been targeted because of the sheer volume of homes and the fact that values have fallen so much more than elsewhere.

    Detroit now has the lowest ownership rate for single-family detached homes of the 20 largest cities in the country, according to data analyzed by longtime Detroit demographer Kurt Metzger.

    Even the sale of U.S. Housing and Urban Development homes has been impacted by the poor housing climate in Detroit. The average sales prices of such homes plunged from $46,702 in 2003 to $8,692 last year. Through the first month of 2009, average sales were $6,035.

    Still, not all of Detroit's real estate market has bottomed out. Listings include a seven-bedroom, 11,580 square-foot Tudor in Detroit's historic Indian Village neighborhood for $849,900, and a $765,000 penthouse condo in the city's Albert Kahn Building.

    What's the effect on a city whose population has plummeted to half its size since the 1950s with no sign of return? The winners might be the renters lucky enough to live in a home that's been fixed up by a legitimate landlord. The losers might be those who end up in less reputable hands.

    The stakes could go either way for the landlords arriving in a market that may not have found its bottom. Same for the dwindling number of neighbors who still own their homes ??? they could benefit from having the vacant home fixed up and occupied but likely will find theirs will fetch a fraction of what they paid or owe.

    Novella Willis, a longtime resident of Cruse Street, soon will have her mortgage paid off but she is among those caught in the changing market.

    "None of these houses are selling. None of them," she said. "If you go down to the next block you'll see a lot of foreclosures all around here."

    The once-stable neighborhood of well-tended brick homes on Detroit's northwest side has some with brick paver driveways and front walks, trimmed bushes and new windows. But foreclosures are creating what Shannon calls "an investors' dream." These are not the infamous $1 homes, but well-built structures falling on hard times that are available for under $10,000.

    Willis, a 70-year-old retired court worker, says renters have hurt the neighborhood.

    "A couple of houses across the street, they are in-and-out renters," she said. "They don't stay long, maybe three or four months. The renters rarely cut the grass, rarely do the snow. You don't see the owners until people leave the house."

    But out-of-town investors have rescued two homes from abandonment.

    Anthony Pierson and Henry Suell of Oakland and Wayne counties bought their home for $8,500. It's one of several they bought through HUD, and they expect to rent it within a month after they perform mainly cosmetic repairs.

    Pierson, of West Bloomfield Township and Suell, of Harper Woods said the goal is to cover taxes and maintenance through the rent and maybe make some money if property values turn around.

    "We just want to invest into it and bring the neighborhood back," Suell said.

    Next door, the road to rehabilitation hasn't been as smooth. Days before a tenant was to move in, someone set fire to the home and caused significant interior damage.

    "To be fair, with all the publicity and all the scare-mongering that goes with Detroit, we were expecting it to happen a lot sooner," said Veness, whose SVC LLC has so far rented three of the six homes they own.

    Veness said he sent 10 e-mails to Detroit-area real estate agents after learning about the city's real estate bargains. He promptly heard back from Shannon, whose firm invited him to Detroit for a tour. Veness came for three days, and he and his colleagues bought their first two homes.

    Veness said they have considered other U.S. cities, but so far Detroit is it. For them, it's simple: The homes are cheap and plentiful.

    "Do the math, you can buy and rehab a home for $20,000, then rent for $900 a month," he said. "Three to four months of the year, rent is going to pay the taxes."

    Rentals typically range from about $800 to $1,000, and many are subsidized by the government.

    He rejects the label "absentee landlord," ??? or at least the image it conveys. He uses local construction and property management companies, and returned last month to take care of business and shop for new properties.

    He also takes a long-term view on investing. Besides raising its stake in Detroit, his group plans to buy, fix and sell groups of homes to other U.K. investors.

    "We just want to build our portfolio as big as we can," Veness said. "I know Detroit has been in a mess ... and I think now is the time. The next 10 years, it's going to change.

    "If my investment still pays for itself, why am I going to leave it?"

    City officials say they know numerous outside investors are buying homes because those who want to rent them must contact the Building Safety and Engineering Department. But exact numbers are hard to come by.

    "For every call we get, I would guess there are five or six people we never know are out there," Detroit Planning Director Douglass Diggs said.

    Diggs said city officials are trying to bring some stability to neighborhoods.

    "We try to make sure that the people who are coming in and making an investment in the properties are going to keep them up. We don't want another crisis down the road where we have inferior housing stock."

    Still, the tight credit market makes it difficult for many people to secure mortgages.

    "We are pushing that individuals do rent-to-own and lease-to-own so people are moving toward home ownership roles," Diggs said.

    One out-of-state investor is attempting to do just that. Newport Beach, Calif.-based Michael Alexander has bought more than 150 homes in Detroit and has hired a local property manager to work with renters to eventually purchase some of the homes.

    The recent rush offers some experts hope for a housing market with no better options left. Property values drop when homes are rented, but in many cases the alternative is an empty house.

    "At times, it's the only way to get the homes occupied," said John Mogk, a Wayne State law school professor.
    Detroit began seeing more homes being rented in the mid-1960s as many white homeowners bought homes in the suburbs but kept their property in the city. It accelerated following the 1967 riot, when even more of the city's white residents moved out.

    A HUD program affecting more than a quarter of the homes in Detroit allowed purchases with no down payment to borrowers with reduced credit standards.

    "At that time Detroit was beginning to lose jobs and unemployment was building up," Mogk said. "Homes began to be abandoned, and then foreclosed on and taken over by HUD and sold en masse to investors.

    Metzger said he's skeptical based on the city's history but hopes new efforts succeed where others have failed.

    "If indeed these investors are going to ... strengthen the housing stock and really make sure the repairs the homes are stabilized, I think it's a great thing," he said. "We need housing stability, however that comes."

  • GrafwritahGrafwritah 4,184 Posts
    Ehhh... I live in the Midwest, and I can tell you that the houses that go for under $10k (generally speaking) do not need just cosmetic fixes.

    Many of them have been looted for plumbing, electrical wiring, etc.

    If someone can make a go of it renting them out, great. I just don't think that many of them are going to be in move-in condition with just a coat of paint.

  • SoulhawkSoulhawk 3,197 Posts
    Listings include a seven-bedroom, 11,580 square-foot Tudor in Detroit's historic Indian Village neighborhood for $849,900

    my previous landlord lived in Indian Village - incredible homes over there - he & his wife & child moved out of the city after he was robbed - 2 guys in ski masks came over his back fence on a Sunday afternoon, pistolwhipped him & grabbed whatever valuables they could find

    welcome limeys!!!!


  • ReynaldoReynaldo 6,054 Posts

    "They're coming to us, saying `Look, I want to buy 50, 100, 1,000.' They want to own every decent and cheap house they can find."
    GRIP N' FLIP BABY!

  • tripledoubletripledouble 7,636 Posts
    rey, theres nobody to flip em too
    what are the prospects of finding buyers or even enough renters in detroit? what about when GM implodes?
    can everyone be employed by the brits and aussies to fix up their new purchases?

  • GrafwritahGrafwritah 4,184 Posts
    rey, theres nobody to flip em too
    what are the prospects of finding buyers or even enough renters in detroit? what about when GM implodes?
    can everyone be employed by the brits and aussies to fix up their new purchases?

    Ha. Houses bird dog themselves now. There's no hunt needed.

    There are just so many shithole houses out there I can't imagine anything but a long term strategy. Even then, though, when houses in cities like Detroit can completely fall in because they are worth less than zero (after rehab costs and/or back taxes, liens, etc.) ... I just don't get it. Why would you come overseas for that? There are enough investors here to pick over whatever may be worth salvaging.

    But what do I know.

  • GrafwritahGrafwritah 4,184 Posts
    Actually I'm thinking that article is skewed... I have no doubt someone would say I'll buy 1,000 houses of certain criteria (i.e. they can reasonably make a few thousand with minimal work). I don't think it is how they put it in the article - people saying give me 1,000 houses solely because they are $10k or under. Makes no sense. That's like me saying give me 1,000 $300 cars simply because they are $300 cars - not because they work or can be put in running condition for a reasonable amount of money.

  • shooteralishooterali 1,591 Posts
    I read this earlier today. With the car industry going under, Detroit's population seems destine to dwindle some more.

  • LokoOneLokoOne 1,823 Posts
    rey, theres nobody to flip em too
    what are the prospects of finding buyers or even enough renters in detroit? what about when GM implodes?
    can everyone be employed by the brits and aussies to fix up their new purchases?

    Dont look at us, all our jobs are in India and China..... maybe heads should start sending their resumes over there.

    But on the houses' tip...I know these houses may be in shit hole condition etc but wouldn't the actual land have some value? I mean if I buy a run down place for $1...even if I got to burn it down to the ground, wouldn't the land still be worth something?

    Maybe thats what they are planning on, buy a whol block worth of cheap land, sit on it, then when the boom comes around again, pay of some politicans, get the re-zoning you want and build like a muthafucker....???

  • SwayzeSwayze 14,705 Posts
    buy a house for $1
    http://abcnews.go.com/Business/Housing/story?id=7034770&page=1
    I think a graemlin is necessary here.

  • SwayzeSwayze 14,705 Posts


  • JimsterJimster Let go me ting, duppy, let go me hand 6,506 Posts
    "I thought it would be quite good fun[/b] to have a look," said Darren Veness, who lives near Brighton, England.

    Nobody over here talks like that. Except moneyed dunces. My impression is that the only folks left in Detroit are the only ones who can't afford to get out. Interesting use of "Robocop" footage - that was in Detroit too, no?

    I think the city needs the ed-209's though. Robocop was too nice.

    "YOU HAVE 20 SECONDS TO COMPLY."

  • DocMcCoyDocMcCoy "Go and laugh in your own country!" 5,921 Posts
    The prospect of somebody organising all-inclusive "Detroit - Techno City" sightseeing tours is an interesting one;

    "Right here is the site of the historic Music Institute, where Ken Collier used to DJ. Later, we'll be making a short stop at Belleville High, where Juan Atkins, Kevin Saunderson and Derrick May first met, and after that, we'll be stopping off at Submerge, where you can spend an hour or two trainspotting and trying to guess which dude is Mad Mike, before the bus takes you back to your luxury rented apartments."

  • skelskel You can't cheat karma 5,028 Posts
    Once we've bought up Detroit we're renaming it Chillingfield-on-SeaTM

  • JimsterJimster Let go me ting, duppy, let go me hand 6,506 Posts
    I did a-pass-tru Deet-royt on the way to LV a while back. My recollections are less than flattering:

    Mad sofa-size ladies in dirty sweat bottoms and pink house slippers [outdoors, natch], and the airport khazis dirtier than a Tallahassee biker-bar when the plague's in town.

    NAGL.

    I suspect the answer is that there is no answer.

  • nzshadownzshadow 5,516 Posts
    Once we've bought up Detroit we're renaming it Chillingfield-on-Sea<sup>TM</sup>


  • Jonny_PaycheckJonny_Paycheck 17,825 Posts
    My mom was telling me last night that people are moving to an "artist community" sprouting up in Detroit, because of the cheap housing.

    Bushwick as Detroit training ground? lol

  • tripledoubletripledouble 7,636 Posts
    buy a $100+ detroit houses...pretty good odds of finding a couple record collections contained inside?
    house for a buck - liquidate on ebay

  • an "artist community" sprouting up in Detroit

    I have my doubts


  • white_teawhite_tea 3,262 Posts
    Being that this is Soulstrut, I misread, thought it was an eBay collector trend for Detroit House, haha. I could have seen some of that action!

  • sabadabadasabadabada 5,966 Posts
    Detroit is a dump, and the city council is out of control. I feel sorry for anybody who has the misfortune of having to live there.

    Just youtube "Detroit City Council" and take your pick. It would be funny if you could forget that these people are in charge and that the citizens of Detroit are the ones paying the price. Your tax dollars hard at work.

  • skelskel You can't cheat karma 5,028 Posts
    Last year a whole gang (I mean well over a hundred) of traders from my financial company talked about pooling their bonuses (i.e. well over $200m) and buying up whole tracts of abandoned/unliveable accomodation on and around the Detroit waterfront. Their idea was to develop it into a secure holiday environment for older people. Then they sobered up. And then some of them got canned.

    I have no idea what the moral of this story is.

    In related news, a few weeks ago the local TV here ran a show where some guy went to Detroit for the express purpose of investing in local property. He looked at all the dollar and bill houses and decided it was no go. He ended up paying something like 20g in a decent part of town, rented it out and has now paid for a big chunk of the house. My father in law saw the show and got quite enthused about it. He asked my opinion, finger poised over the 'commit' button on some cheap flight website.
    I says to him, "What the F*ck you going to do in Detroit?".
    He didn't go.

  • LoopDreamsLoopDreams 1,195 Posts
    The money's in getting ahold of the large turn of the century, abandoned homes in the core of the city and salvaging all the hardwood trim/ handrails/ doors/staircases. You can't get that shit anymore... it breaks my heart, as someone who works with wood, driving through D and seeing those homes left to rot since the riots.
    My social conscience winces at the idea of further gutting of that city's infrastructure, but as roofs collapse these places are simply rotting into the ground.
Sign In or Register to comment.