Home Buying in Detroit>Question Details

Rajeev V, Home Buyer in Miami, FL

I am an Australian investor looking to invest in Detroit or other areas that have super low prices. I have

Asked by Rajeev V, Miami, FL Wed Aug 5, 2009

noticed some sites with crazy 20% net returns on 20k 3 bedroom homes, are these too good to be true? Also these are section 8 housing, is this an issue or is the guaranteed rent a huge plus?

I am looking to invest in one property for now & if all goes well then why not look into several. The potential for prices to restabalise over the coming years are a huge drawing card as well as the positive gearing & low initial investment.

Just waiting to hear a catch and see what could be an issue down the track.

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Bruce Ailion’s answer
Rajeev, Good luck with your investment, as you know or will learn, the higher the return the higher the risk of not getting the return. Sub-prime lenders learned this, many sub-prime buyers will find the same. Some pay off big, some write off big that is the nature of high yields. Much of real estate is about Location Location Location, and these cold, rust belt cities, lack the long term appeal of the growing and dynamic sunbelt cities. Certainly you made a better choice than Detroit time will tell if you got a deal or a dud.

Bruce@LocationLocationLocation.com
0 votes Thank Flag Link Tue Aug 20, 2013
Dear Bruce, do you live in Detroit. Do you invest in Detroit? If not, please do your do diligence about the market here. Honestly, it is great for long term investment and the middle investor. But small investors will have the hardest time. If you have the money to invest and have strategy in place, then 6 to 12 mos. for return on initial investment 12 to 24 mos. for total investment return.
Another issue as I have seen it non local investors need to trust your contact's knowledge of the local market. Rules, pricing, cost of labor, marketing , etc. Differnent. And don't be afraid to rethink strategy.
Flag Wed Aug 21, 2013
I ended up buying in Rochester, NY - very happy! Used collossal property and am getting around 25% net return... about 6 months in now.

Feel free to contact my if you have any questions/concerns.
1 vote Thank Flag Link Thu Jan 6, 2011
Rajeev: The word we keep hearing and reading most these days is 'Austerity". We believe this signals a major paridigm shift... one that may cause landlords used to government subsidy programs to keep units filled to re-think current business models.

A significant weakening in rental demand caused by shrinking government rental subsudies could significantly impact cash flow and even depress already low prices for single and multi-family.

It's not a prediction, but something to consider in your investment plans. There may be better models available.
1 vote Thank Flag Link Sat Nov 20, 2010
We work with overseas and out of state investors buying in Detroit.
Video Inspections of any potential investment property or neighborhoods that you can watch on your computer or smartphone.
http://www.VideoInspectors.com
0 votes Thank Flag Link Mon Apr 21, 2014
Multi Family Home $15,000 cash in Dedroit, Michigan, PLEASE send email for more information and your phone number.
Thanks
0 votes Thank Flag Link Fri Apr 18, 2014
If you're buying, rehabbing or Just want to check up on a Detroit rental property check out http://www.VideoInspectors.com
0 votes Thank Flag Link Thu Apr 17, 2014
Hello, my name is John.

I was born and raised here in Detroit area. My wife and I have properties of our own. And some we are looking to sale. We also have access to over 200 available properties. If you would like for us to help you in your search please contact us at mrjwyatt@yahoo.com

And here the sec8 program is a sure way to get your rent moneys on time and your property rented
0 votes Thank Flag Link Thu Apr 17, 2014
We Buy, Sell and Rehab Detroit Investment Properties.
SheriffWholesale@gmail.com
http://www.SheriffWholesale.com
0 votes Thank Flag Link Tue Aug 20, 2013
Hi Mr. Rajeev,

My name is Charlene Johnson and I am a licensed Realtor in the State of Michigan. Detroit is a very good place to invest in but please do your "Due Diligence". My company is Conquest Real Estate Group and we have under our umbrella a Property Management Company, You can consider us a one stop shop, meaning not only can we assist you in purchasing a home but we can manage the property for you also.

Make sure that whomever you choose to work with they are who they say they are, please ask a lot of questions and make sure the answers Make Sense! Starting with one property is very smart, that will allow you to gage the entire process.

I would love to work with you, please give me a call and allow me to find you your first of many homes.

Thank you,

Charlene Johnson, Realtor
Conquest Real Estate Group
16250 Northland Drive, Suite 202
Southfield, MI 48075
(248) 569-1486 - Office
(248) 595-8966 - Fax
(313) 574-7633 - Cell
cjohn3615@gmail.com
0 votes Thank Flag Link Tue Aug 6, 2013
Hello to any one interested in the Detroit market. We have plan to get you into rental properties in the Detroit area without worrying about rehab and the like. Houses are sold at investor's price with tenants occupying the property at your purchase date. No up front money needed.

Detroit Renewal Group, llc.
313.445.9823

serious inquiries only
0 votes Thank Flag Link Sun Aug 4, 2013
I am a general contractor looking to partner up with someone willing to invest in Detroit. I am willing to put up materials and the renovation of properties in exchange for someone willing to put up funds to purchase properties for an equal split. I am very familiar with every aspect and have worked for property management co.'s and investors for a long time. I have a full crew from plumbers, electricians, painters, roofers, carpenters as well as great relations with various vendors for great material pricing. If this is something that is of interest to you please contact me at Rapidrenovationsmi@gmail.com
0 votes Thank Flag Link Tue May 14, 2013
Hello the Mr. Investor, I am Ken Powell and I have a couple of nice Rental Properties (Ready To Move In) for sale $12,000 & $15,000. I have a Temp Renter at one of the locations, therefore, if you are interested please feel free to contact me KJPowell187@yahoo.com

Thank you for your time.
0 votes Thank Flag Link Tue Apr 23, 2013
Rajeev,
15% is pretty typical for a NET return in a good neighborhood with a nice property. We deal with 15% net returns all day long in Detroit and every few weeks we'll run across a home run of 20%+. Those deals tend to fly off the shelf quickly though. Good luck in your Detroit Investment Property search and check out: http://BuyHomesInDetroit.com for updates on the Detroit Real Estate Market and turnkey Detroit properties for under 40k.
Matt
0 votes Thank Flag Link Fri Aug 12, 2011
Yes, there are opportunities for high returns on real estate investments in Detroit, but the people who know of them aren't advertising them on the internet.
0 votes Thank Flag Link Wed Aug 10, 2011
Hello Rajeev,

That is a little bit of an exaggeration don't get me wrong it is possible but highly unlikely on
a regular basis.It's more in the realm of 12%-17% return on investment.You should have
someone or company that knows the good areas to rent with the thought that the neighborhood
is pretty stable.Section 8 is good good if your looking for guaranteed rent payments also property management
is also important.You should be able to see what is going on with your properties like rent payments,repairs
tenant info etc.Our company specializes in all the things that you may be looking for.Go to our site
http://www.metrodetroitrentalexperts.com to find out more or call me at 248-569-1486

Thank you,

Chris Shaw
Metro Detroit Rental Experts
16250 Northland Drive st 202
Southfield,Michigan 48075
0 votes Thank Flag Link Wed Aug 3, 2011
hi..i have over 16 years in the mortgage business and just started a real estate investment co...
pls call...
best regards
bob mcclure
0 votes Thank Flag Link Sun Jul 24, 2011
Detroit probably has the lowest property prices in the country. They were the hardest hit during the recession. You're probably right about the potential for prices to re stabilize.
0 votes Thank Flag Link Fri Jul 22, 2011
The Atlanta metro area represents one of the best opportunites in the US. Values on homes build in 2000-2006 are down 70% from their initial sale. With little to now new construction in 3 years and a growing population, rents are rising. Our typical investor purchases a home for 40000 that previously sold for 120-140, spend 10-15k on new paint, carpet appliances and HVAC and rents for 1100 per month. A fantastic cash on cash with a 100% upside with a return to 2002/2003 values. Atlanta is a dynamic, diversified market, world class business, transportation, progressive government and low taxes. Expect 20 years if ever for Detroit to return to 2000 pricing. Feel free to contact me and I send you several of the recent sales and analysis.

Bruce Ailion,
RE/MAX Greater Atlanta
CRS, CRB, ABR, MSRE, CDPE, e-PRO, ESQ
Certified Residential Specialist
Certified Real Estate Broker
Accredited Buyers Agent
MS Real Estate and Urban Affairs
Certified Distressed Property Expert
Certified Internet Professional
203K Certified Specialist
Attorney
2050 Roswell Road
Marietta GA 30062
770-973-9700 Office
404-978-2281 Direct
bruce@locationlocationlocation.com
http://www.LocationLocationLocation.com
0 votes Thank Flag Link Thu Jul 21, 2011
I live in Detroit. have been an investor for 11 years, and I have never seen deals on homes sch as this in my life... Now is an excellent time to invest in Detroit and the surrounding suburbs. There are many steals for under 10k. Some even less. The only thing that I would suggest is to have someone based in Detroit that knows the city, the real estate, and it's neighborhoods to make sure you are'nt purchasing shells, burnouts, or in certain area's that may not be the most desireable for various reasons. That is where I can be of service to you. I have been in search of an outside investor to take advantage of this urban "goldmine"... I can no longer afford to suck up any more properties. my money is nt that expendable, but I do not want to let these deals pass me by. We can be o service to each other... my name is Jeff. my email address is sumitcomm@msn.com. My # is (313)424-9753. I an b reached @ anytime. Thank you
0 votes Thank Flag Link Thu Jul 21, 2011
Considering investing in the U.S. then look to Arizona which has some great prices and is a growing area. Not to mention a wonderful place to vacation as a business write-off!

Call me if you decide AZ is a place to look into or check out my website to search for properties: homesales411.com

Sandy Farmer
0 votes Thank Flag Link Wed Apr 27, 2011
Detroit is a decent option, however there are much better opportunities in the area.
There is a town within 20 miles of Detroit where there is true opportunity. In 2005 the average sales price for homes in this town were just under 100k. In 2010 the average sales price for homes in the same town were under 30k. The key factor however is that rent in 2010 was averaging $675.00 now the rent averages $750.00. You can get into the houses for a third of the price and rent prices are going up.
Here is the key over Detroit. If the economy improves in say 5 years Detroit will still be way behind, there are too many problems in Detroit. However if the economy improves the sales of the homes in this other town will start to go back to their 2005 sales prices. I think we all know that prices aren't going to be back to 05 numbers but why be in Detroit where appreciation will be delayed when you could be in a community that has a great chance to rebound.
If the economy gets better property values will increase and you can sell for a nice gain, if foreclosures continue and the economy stays in a declined state your rental revenues will increase. Why not be in a community where you are proptected either way?
I can show you all the numbers and have turn-key properties with renters in them for you. I have no interest in selling one property; I am interested in showing my investors great returns therefor they do more properties and I make more money. Sorry to be blunt but there is no reason to dance around ones true objectives.
Please feel free to e-mail me at titoshafer@yahoo.com and I will get you more information
0 votes Thank Flag Link Wed Apr 27, 2011
I am the Man you need to talk to. I currently have 2 package Real estate investments in Detroit under $30 a home yielding returns of 20% or higher. Contact me 313-475-3165
0 votes Thank Flag Link Thu Jan 27, 2011
Be careful..its $20,000 for a reason! Areas like Detroit are suffering population loss and are even considering demolishing homes and shrinking the city. Look for more expensive investments in more secure areas. 20% returns on small prices are small returns!

Richard Schulman
#1 Listing and Selling Agent
Keller Williams West LA
310-482-0173
schulmanrd@yahoo.com
http://www.RichardSchulman.com
0 votes Thank Flag Link Thu Jan 6, 2011
YES 18-24% ROI is VERY true if you are dealing with the right company and right houses. I have completed over 100 overseas transactions with a majority of buyers being from AU. But BEWARE of the scams or middle men that try to raise prices for "quick flips" buying the home is the easy part its the reno and management that is going to make or break the deal.We can handle the entire transaction from buying, reno, renting, selling and even setting up an american LLC ( US version of LTD.) I would love to add you to my list of clients and help build your US portfolio. Feel free to contact me with any questions or to request further detail. I will also be including the website of a friend of mine who has his his business based in AU http://www.apws.net.au or you can contact me @ 734-237-5969 or RentDetroit@gmail.com
0 votes Thank Flag Link Mon Jan 3, 2011
Hi there, Visit this website which provides free resources and information about Detroit from a international investors perspective. The address is
0 votes Thank Flag Link Mon May 10, 2010
Call Desert Management Group at 877 572 4466. They have VERY VERY good knowledge, AND have propery management in place for their cheap homes.
0 votes Thank Flag Link Fri Sep 18, 2009
Hi Reajeev,
We have a few investor's that are buying homes in the $20K price range, they do minor renovation work and are renting them for around $700 per month, they plan to sell in the next couple of years, once the market starts to improve, I would think that you would more than double your money. This area is about 15 mins from the Airport and 20 mins from downtown Atlanta, great location. Let me know us know if you need more info!
Thank you and have a Great Week-end!
LBR Home Selling Team
Linda, Brenda, Rhonda
RE/MAX Advantage
770-616-6817
0 votes Thank Flag Link Sat Aug 22, 2009
We have some great prices here in the Atlanta area! Investor's are really buying alot of homes in the $20-30K range and using them for rental property until the market picks back up and then you should see a nice profit!
0 votes Thank Flag Link Fri Aug 21, 2009
I am a large investor in Detroit. Please feel free to contact me with questions.

Adam
Desert Management Group LLC
877 572 4466
0 votes Thank Flag Link Fri Aug 21, 2009
You most likely need a real estate consultant provide you additional stat's. Professional agents can't make comments , you need establish a short / long term business plan.

Usually areas in USA way below market great invest however depends on rate of return on purchase. I have been a long time real estate investor with success. Dallas, TX markets offer many opp's for world wide investors.

CONTACT OUR OFFICE TODAY
972-699-9111
Lynn A. Crosby ~ National Featured Realtor
Follow me on Twitter: http://twitter.com/Lynn911
"...Specializing in Residential, Commercial Properties and Loans..."
Dallas Realtor, and Credit Repair Consultant -
The Michael Group - "Dallas Business Journal 07’ & 08' list top realtors"
Dallas Loan Officer -
Dallas Real Estate Website: http://www.lynn911.com 60,000 listings Dallas homes for sale
0 votes Thank Flag Link Thu Aug 6, 2009
I live in Detroit all my life, I love this city.

But, Perhaps the most common misperception surrounding the Detroit real estate market is that a large percentage of the population has deserted it. Read the real truth about Detroit's real estate market.

Sorting fact from fiction
0 votes Thank Flag Link Wed Aug 5, 2009
You will get no arguement that the Detroit real estate market e terrific opportunities for today's buyers. We would offer a word of caution that includes the fact that there are many other areas of the country that present these types of offerings and may have greater resale value because of the desirability of the location.

Our recommendation is to not only consider your investment from the purchase point of view but its resale value as well.

Good luck
The Eckler Team
0 votes Thank Flag Link Wed Aug 5, 2009
Lots of possibilities, but doing your homework definitely pays off.
Yes, there are true stories, but always beware anything that sounds too good.

As with any overseas investor I work with, I urge you to consider the "other" factors with managing from afar --
Who is going to do the work to rehab the home?
Who is going to do the day to day management?
etc

These are all difficult things to coordinate without a good amount of effort, so if you want someplace to start, let me know and I'd be glad to help.

Happy hunting!
0 votes Thank Flag Link Wed Aug 5, 2009
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