Alex Nigel,,,
this goes to a philisophical point…. And Freckle would like this….
Alex is 100% on about US investors shying away from certain markets detroit being one… And again its inner detroit but inner detroit is a huge area…
So where do you think Detroit would be right now if foriegn investors especially the GB companies that set up there… If these companies never went there…. You would have a town in even worse shape… financially and another probably 20,000 vacant homes there is already 45,000 homes in Detroit that could be knocked down tomorrow and there is still plenty of housing for the population…. Towns shrink,… industry moves,,, The whole Rust belt did this when steel manufactors went off shore…
Or small one industry towns the industry closed up,,, there are all sorts of cities and towns that have had this happen to them over the past 50 years nothing new here.
But at the end of the day its a false market… when and if the Off shore investors decide Detroit proper is too dangerous and stop buying there whats going to happen another huge crash… prices of these homes are already Sub 5k to the wholesalers that are providing these to the off shore marketing companies…
These houses over time will just get shuttered and knocked and burnt down is what will happen…
And no amount of money for one investor will save their investment in these areas that are dead or have been on artifical breathing which is what I call the off shore investor that buys in the hood… you had a dead patient now you put them on life support they can live forever but at what cost.. and when should you pull the plug, these areas are already brain dead….
OK guys, let's try to sort some things out with regards to Detroit.
Jay is perfectly right when is stating that "slums are slums" no matter where they are. If you try to compare the slums of Detroit with the slums of Charlotte or Atlanta, they probably are NOT the same ! Detroit is a bigger city and its slums are, of course bigger.
In fact, for me , 95% of the CITY is a big slum. And Jay, to be honest, I don't feel safe at all, even if I'm in downtown Detroit.
For the investors, Detroit has only very small pockets, and lately, it became harder and harder to find good properties in this areas. For the spruikers, of course, that's not a problem – they can sell to OZs some junk houses in the middle of the slums and present them as "investment properties". Piece of advice: before buying something in Detroit CITY do your due diligence and get as much info about the property and the wholesaler as you can.
A whole different story is Detroit METRO – with Detroit's suburbs. Here you have a lot better chances to establish a good business. Wonderful cities, nice locations, good and safe neighborhoods, not as high cash flow as in the City though.
Some time ago I've stated that the prices went up 15%-20% compared with the January prices; I was referring to the Metro area and not to the City.
For out of state investors is very risky to buy something in the City if you don't know the seller, so beware… Don't just be attracted by some un-real high cash-flows (which are possible, though) and nice pictures sent to you by some company who has a nice website. That's my advice.Mihovi
Not to split hairs and since I am 95% bald I have no hair to split… or at least I can spare…
Atlanta Metro is 3 times the size of Detroit… and Charlotte is probably close to the same.
its really comes down to price…… and demography…
The exception to this is small mid western towns.. And even some small Western and Eastern towns…
You can buy a nice little house in some small town in Oaklahoma for 10k that will rent for 400… never have a worry about vandalism etc etc… But there is no Cache' there and no up side… there are thousands of these small towns from the rockies to the Eastern seaboard were this is possible.
I have started to invest in one I like… I used to make loans there now I am buying.. And I just bought a nice older duplex for 4500 and it will take about 10k to rehab… Each side will rent at about 375.00… No real upside but nice cash flow and no vandilism and or ghetto type problems town is 97% white with the rest mex and Black…… and some white trash which as we all know is just as bad….I have not decided yet whether I will bring these into the TWH family of properties.
JLH
Fascinating thread, boys, thank you.
Ziv Nakajima-Magen | Nippon Tradings International (NTI)
http://www.nippontradings.com
Email Me | Phone MeZiv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property
You must be logged in to reply to this topic. If you don't have an account, you can register here.
