Detroit Real Estate - an update

Any of you remember a thread from a year or so ago - a house in Detroit sold for $10?

Now, its happening all the time. In Detroit last month, the median price of the homes sold was $7,500. Some were offered at $0.

http://www.denverpost.com/business/ci_11475891

One guy is buying some homes as investment properties. Pretty funny line:
"I've got an MBA and an engineering degree," Russell said. "I use Ian because he doesn't have a college degree. He's got common sense. . . . All of the MBAs are the ones who created this financial mess."

Good times... the article says there are stretches of Detroit that the police no longer even patrol (Urban Prairie).

 

I realize the tongue in cheek nature of the post, but honestly what's happened to Detroit (and other industrial cities like it) is fucking tragic and should bother us more. Entire regions that used to be the engine of our economy sacrificed to the free trade/cheap labor gods.

 

And it is only going to spread...

 

Odd to think that the Detroit of "Robocop" was only about 20 years ahead of its time.

 

We had a meeting with our 401k administrator last month and not surprisingly, the economy came up, and he specifically talked about how million dollar houses in Detroit are selling for 100k. Which would be great if there were any jobs there.

 

I think it was Dateline that followed the mortgage repo men around in four states (Florida, Arizona, California and Michigan). It documented how each state dealt with foreclosures. In Michigan, the sheriff and some sort of bank officials show up, throw your shit on the lawn and change the locks. At the time of the story, they were doing 10,000 homes a month. And the cops and officials refused to have their faces and voices on camera without being altered. They feared "repercussions."

 

After seeing the state of Florida real estate after boxing up the stuff in the condo my mother-in-law just sold, I might invest in Detroit futures quicker than I would in Sarasota futures. The golf course you played last year is the new critter habitat this year. Carl Hiassen must be eating this up.

 

Crack houses? Or houses with large cracks in them?

I'm holding out for a better deal on the Windsor Tunnel.

 

I'm guessin crack houses with large cracks in them. But, still, we're talking homes for the price of a stop at McDonald's, this is your once in a lifetime opportunity to become a slumlord, don't let it pass by.

 

Stoney could not agree more. I had not really thought about it much until I read Mitch Album's story on Detroit in SI. The fact that this has been allowed to happen pretty much below the radar is pretty fucked up.

In retrospect the way Congress treated the Auto executives a few weeks back was disgraceful. Rather than grandstanding they all should have been putting their heads together to save all these Midwest cities.

 

Problem is the southern Senators who were doing that grandstanding have no real interest in saving midwestern cities, not when the rival foreign automakers have decided to concentrate their U.S. manufacturing in the South. Seems some of those guys now see the Big 3 and Upper Midwest as economic rivals to be stamped out and destroyed.

 

I was only semi-sarcastic about what I said about Florida. Everything I saw and heard driving from Bradenton, Fla., to Nashville was about economic apocalypse. The Midwest doesn't have it great, Michigan in particular, but southern states are really feeling the deflation of the housing market, which they were much more dependent on. Any of Jeb Bush's school reforms in Florida, for better or worse, are being left to die on the vine because of massive spending cuts, which will be doubly massive next year. I heard in Georgia that it is second to Michigan in the number of layoffs. Tennessee is cutting non-UT system college funding by something like 15 percent. (I'm sure UT is being cut as well, but I was just passing through and didn't catch the full flavor.) Maybe one motivation for Southern senators finger-wagging Detroit is overcompensating for the fear they will have areas in their state that will be headed for the same fate.