The median price of a home sold in Detroit in December was $7,500

johnnymk · 03-03-2009, 06:59 AM

http://www.chicagotribune.com/news/n...84,print.story

Motor City on the brink of bankruptcy, but still 15 people want to be mayor

DETROIT — It may be tough to get financing for a new car these days, but in Detroit you can buy a house with a credit card.

The median price of a home sold in Detroit in December was $7,500, according to Realcomp, a listing service.

Not $75,000. Remove a zero—it's seven thousand five hundred dollars, substantially less than the lowest-price car on the new-car market.

Among the many dispiriting numbers that bleakly depict the decrepitude of this onetime industrial behemoth, the steep slide of housing values helps define the daunting challenge to anyone who wants to lead this shrinking, poverty-pocked city of about 800,000 people.

"We're always fighting ourselves out of a hole," said Wayne County Sheriff Warren Evans.

Despite the depth of the hole, Evans is running for mayor. In fact, he is one of 15 people who have raised their hands to be mayor of Detroit and fill the remaining months in office of the former mayor who now wears a green jumpsuit and resides in Evans' spartan house of justice, the Wayne County Jail.

Detroit has long been the snide remark and punch line to derogatory urban humor, and the conviction last fall of two-term Mayor Kwame Kilpatrick for lying about an extramarital affair with his chief of staff reinforced suspicions that Detroit is beyond help, let alone self-governance. But as the domestic auto industry, the city's principal private-sector employer and founding corporate father, seeks a financial bailout from Washington, formerly whispered remarks about the prospect of the nation's 11th-largest city being the first major American city to go bankrupt are now publicly discussed.

If the Obama administration is looking for a city to test new ideas for chronic urban problems, it can look to Detroit, a northern New Orleans without the French Quarter. While bedrock poverty in the Crescent City was violently laid bare by Hurricane Katrina in 2005, Detroit has been quietly slipping into social and economic crisis for 40 years.

One-third of the population lives in poverty, and almost 50 percent of children are in poverty, according to data from the Detroit-Area Community Indicators System. Median household income has dropped 24 percent since 2000, according to the Census Bureau.

more on the link

guiseppewv · 03-03-2009, 07:23 AM

Wow. I did not realize it was that bad. Man, those numbers, not just the home sales numbers, are staggering. 50% of children live in poverty? I guess that is what happens when you elect one idiot mayor after the other into office.

InfiniteNothing · 03-03-2009, 07:32 AM

Sad. I'm curious what the sample size is though. Maybe 1 crappy house sold in Dec

guiseppewv · 03-03-2009, 07:51 AM

I think you have a point. I think it is more like 100 sold at $1k (due to foreclosure and no demand for purchasing them) and a handful of houses sold for < $100k.

The city should buy up those foreclosures and bulldoze them or sell them as part of a gentrification project after the economy rebounds.

I think the bigger point of this story is how many Detroit residents live in poverty.

zippyjuan · 03-03-2009, 08:58 PM

The numbers are very confusing. Condos must be doing a ton better than homes because this says that the median residence including condos and homes was $47,000.
http://www.freep.com/article/2009021...SS06/302130004

Quote:

Metro Detroit home sales continued in positive territory for January, but more than half were of foreclosed homes and that dragged the median sales price down by 48.4%.

Home sales rose 25.7% last month to 4,301 from 3,421 in January 2008 for Wayne, Oakland, Macomb and Livingston counties and parts of St. Clair County, according to Realcomp, a multiple-listing service in Farmington Hills.

Realcomp figures come from sales that closed in January as reported by its Realtor members.

Karen S. Kage, CEO of Realcomp, said she was heartened that the inventory of homes on the market fell by 21% compared with January 2008. But there is still more inventory to clear out with foreclosures continuing to come on the market.

And that will keep the median sales price low until things get better.

The median sales price on all residential and condominium sales in metro Detroit fell 48.4% to $47,000 in January compared with $91,000 a year ago. The median home sales price in Detroit was down 39% to $7,000 from $11,500 a year ago.
In Oakland County, the median sales price was $85,000, down 41.4% from $145,000 last January. In Macomb County, the median was $67,500, down 38.4% from $109,500; Wayne County had a median sales price of $17,000, off 51.4% from $35,000; Livingston County was at $135,000, down 24% from $177,900; and St. Clair was at $54,900, down 53.2% from $117,225.

Foreclosures accounted for 2,329 sales of the 4,301 reported in January in metro Detroit.
The number of homes on the market in January fell to 53,815 from 68,174 in January 2008.

Detroit would be a good place to be from, not in.

brainsmile · 03-04-2009, 12:30 AM

Michigan in general is really getting hit hard by this housing crisis. I saw homes being sold on ebay for $400 in that state.

guiseppewv · 03-04-2009, 06:12 AM

Quote:

Originally Posted by zippyjuan

The numbers are very confusing. Condos must be doing a ton better than homes because this says that the median residence including condos and homes was $47,000.
http://www.freep.com/article/2009021...SS06/302130004

Detroit would be a good place to be from, not in.

I guess it is all a matter of perspective because I wouldn't say this is good:

Quote:

The median sales price on all residential and condominium sales in metro Detroit fell 48.4% to $47,000 in January compared with $91,000 a year ago. The median home sales price in Detroit was down 39% to $7,000 from $11,500 a year ago.

Jeffbx · 03-04-2009, 07:58 AM

Jut to clarify a couple of points:

1) The City Detroit is a smoking hole, for the most part. I can absolutely believe the median cost a house in the city is that low, because there are literally thousands of abandoned properties that can be had for free, if you just agree to pay the property tax. The city just hasn't gotten off of its a$$ & torn them down. In any case, it is NOT an area that anyone wants to live. Yes, there are nice areas where it's OK, but no one "moves to Detroit" and buys a house in the city.

2) The City of Detroit <> the auto industry. Yes, the 3 major companies were founded in the Detroit area, but only GM is headquarted there, and a majority of the workers commute into the city. The media loves to put them hand in hand, but it's really not the case anymore. The people who are working for automotive all live in the suburbs - primarily Oakland county (median home value $178k and dropping rapidly)

The Happy Squirrel · 03-04-2009, 09:36 AM

plus they got the lions!!! LOL

whitealexander · 03-04-2009, 07:53 PM

man the house just almost the price of my pc..

zippyjuan · 03-08-2009, 08:26 PM

Looks like the low prices are attracting investors from all over- that should help stablize or even raise them somewhat.
http://my.earthlink.net/article/top?...90308750105368

Quote:

Outside buyers drawn to Detroit's foreclosed homes
By JEFF KAROUB and COREY WILLIAMS (Associated Press Writers)
From Associated Press
March 08, 2009 9:50 PM EDT
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.

03-03-2009, 06:59 AM	#1
johnnymk Chief of Naval Operations Join Date: May 2000 Location: LEVITTOWN< PA> USA Posts: 13,619	The median price of a home sold in Detroit in December was $7,500 http://www.chicagotribune.com/news/n...84,print.story Motor City on the brink of bankruptcy, but still 15 people want to be mayor DETROIT — It may be tough to get financing for a new car these days, but in Detroit you can buy a house with a credit card. The median price of a home sold in Detroit in December was $7,500, according to Realcomp, a listing service. Not $75,000. Remove a zero—it's seven thousand five hundred dollars, substantially less than the lowest-price car on the new-car market. Among the many dispiriting numbers that bleakly depict the decrepitude of this onetime industrial behemoth, the steep slide of housing values helps define the daunting challenge to anyone who wants to lead this shrinking, poverty-pocked city of about 800,000 people. "We're always fighting ourselves out of a hole," said Wayne County Sheriff Warren Evans. Despite the depth of the hole, Evans is running for mayor. In fact, he is one of 15 people who have raised their hands to be mayor of Detroit and fill the remaining months in office of the former mayor who now wears a green jumpsuit and resides in Evans' spartan house of justice, the Wayne County Jail. Detroit has long been the snide remark and punch line to derogatory urban humor, and the conviction last fall of two-term Mayor Kwame Kilpatrick for lying about an extramarital affair with his chief of staff reinforced suspicions that Detroit is beyond help, let alone self-governance. But as the domestic auto industry, the city's principal private-sector employer and founding corporate father, seeks a financial bailout from Washington, formerly whispered remarks about the prospect of the nation's 11th-largest city being the first major American city to go bankrupt are now publicly discussed. If the Obama administration is looking for a city to test new ideas for chronic urban problems, it can look to Detroit, a northern New Orleans without the French Quarter. While bedrock poverty in the Crescent City was violently laid bare by Hurricane Katrina in 2005, Detroit has been quietly slipping into social and economic crisis for 40 years. One-third of the population lives in poverty, and almost 50 percent of children are in poverty, according to data from the Detroit-Area Community Indicators System. Median household income has dropped 24 percent since 2000, according to the Census Bureau. more on the link

03-03-2009, 07:32 AM	#3
InfiniteNothing Fleet Admiral Join Date: Aug 2002 Location: San Diego Posts: 9,997	Sad. I'm curious what the sample size is though. Maybe 1 crappy house sold in Dec __________________ As for our common defense, we reject as false the choice between our safety and our ideals.

03-04-2009, 12:30 AM	#6
brainsmile Chief of Naval Operations Join Date: Jun 2000 Location: woah... why is welfareloser here with me so early in the morning and more importantly why am I wearing her clothes?!? Posts: 13,721	Michigan in general is really getting hit hard by this housing crisis. I saw homes being sold on ebay for $400 in that state. __________________ ********************************** DCM #1 (Founder) "Nobody beats Vitus Gerulaitis 18 times in a row." - Vitus Gerulaitis on beating Jimmy Connors after 17 failed attempts.

03-04-2009, 09:36 AM	#9
The Happy Squirrel Rear Admiral Lower Half Join Date: Oct 2000 Location: the castle beyond the goblin city Posts: 2,760	plus they got the lions!!! LOL __________________ Lion face / lemon face!

03-04-2009, 07:53 PM	#10
whitealexander Lieutenant Junior Grade Join Date: Jan 2009 Location: 2200 Norma Lane Monroe Posts: 137	man the house just almost the price of my pc.. __________________ beware what you wish for...

03-03-2009, 07:23 AM	#2
guiseppewv Admiral Join Date: Nov 2001 Location: East coast Posts: 6,955	Wow. I did not realize it was that bad. Man, those numbers, not just the home sales numbers, are staggering. 50% of children live in poverty? I guess that is what happens when you elect one idiot mayor after the other into office.

03-03-2009, 07:51 AM	#4
guiseppewv Admiral Join Date: Nov 2001 Location: East coast Posts: 6,955	I think you have a point. I think it is more like 100 sold at $1k (due to foreclosure and no demand for purchasing them) and a handful of houses sold for < $100k. The city should buy up those foreclosures and bulldoze them or sell them as part of a gentrification project after the economy rebounds. I think the bigger point of this story is how many Detroit residents live in poverty.

03-04-2009, 07:58 AM	#8
Jeffbx Fleet Admiral Join Date: Mar 2000 Location: Michigan Posts: 9,065	Jut to clarify a couple of points: 1) The City Detroit is a smoking hole, for the most part. I can absolutely believe the median cost a house in the city is that low, because there are literally thousands of abandoned properties that can be had for free, if you just agree to pay the property tax. The city just hasn't gotten off of its a$$ & torn them down. In any case, it is NOT an area that anyone wants to live. Yes, there are nice areas where it's OK, but no one "moves to Detroit" and buys a house in the city. 2) The City of Detroit <> the auto industry. Yes, the 3 major companies were founded in the Detroit area, but only GM is headquarted there, and a majority of the workers commute into the city. The media loves to put them hand in hand, but it's really not the case anymore. The people who are working for automotive all live in the suburbs - primarily Oakland county (median home value $178k and dropping rapidly)

03-09-2009, 02:00 AM	#12
ray captain awesome Join Date: Jan 2003 Posts: 6,961	Here in Praha I saw a commercial on CNN International promoting businesses to open new locations in Michigan because it's a great state. You know there's problems when you have to solicit TV advertisements to drive business into your state. __________________ new uploader

03-09-2009, 06:16 AM	#13
Jeffbx Fleet Admiral Join Date: Mar 2000 Location: Michigan Posts: 9,065	Yeah, the governor has been doing that for a long time now (recruiting international companies to come here) - it's actually an excellent place for R&D or manufacturing firms to open an office, since there are so many displaced engineers just floating around.

03-09-2009, 12:26 PM	#14
cruelpupet Admiral Join Date: Jan 2001 Location: NYC Posts: 5,398	Wow, the city is just ripe enough for OCP to come in and buy up everything. __________________ Am I alone here? Is that it? Am I the only one who sees. Maybe we can learn to be just like him. Wear a little uniform. Yes, sir. No, sir. Thank you, sir.

03-10-2009, 05:39 AM	#16
Jeffbx Fleet Admiral Join Date: Mar 2000 Location: Michigan Posts: 9,065	Heh - but they'd never get their HQ built because it would be stalled by Detroit City Council

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