Detroit for buying rentals?

Question

I know how much @Joshua Dorkin loves Detroit, but in light of the recent BP article highlighting the best markets for REI, looks like Detroit is ranking pretty high.  I have heard Kathy Fetke say good things about Detroit as well.   I must admit, when I think of Detroit, I think of high crime and a depressed auto industry.  But maybe my thinking is outdated.  What do you think about buying rentals in Detroit?

Diego Ortega · Answer

@Jenelle Harris

I agree with Alan. I am a young professional who works in downtown Royal Oak and many of my coworkers who are 21-40 rent in Suburbs nearby. (These are people with a salary range of 50k-100k or more). Ferndale and Royal Oak being one of the top cities to rent near me due to the downtowns and nightlife. Young professional flock here and rent is really high. But that also means it's a little tougher to find a deal in those cities. So that is spilling over to Oak Park, Hazel Park, and anywhere young professionals can find nearby.

Yes, some will want to purchase a home here, but there isn't much land so most of my coworkers with big families tend to buy further north like Clarkston, where it's more family oriented and you get some decent land sometimes with your house.

Check out the rental market in Royal Oak now: https://www.zillow.com/homes/for_rent/Royal-Oak-MI...

The cheaper ones are literally to rent a room.

Alan Stalter · Answer

I think there are a lot of suburbs that rent well- Redford, Lincoln Park, Eastpointe & Westland to name a few. I don't agree with what you are being told.

Alan Stalter · Answer

Hi Jenelle,

I want to echo Diego's thoughts. There are a lot of thriving suburbs around Detroit. For your first investments here, I would stick to these suburbs before venturing into the city.

Mindy Jensen · Answer

Hi @Jenelle Harris , buying property  in Detroit can work, but you would need someone you trust to be your boots on the ground.

Also, the city went through bankruptcy. I'm not all that up to date on their finances, but stories of no trash collection, 45 minute fire truck response times and even longer police response times have me looking at other cities with more money and better services.

They hit their population height in the 60's at 1.6 million people. Now they have 700,000 residents. That's a LOT of empty housing.

David Kenny · Answer

I'm in Royal Oak, and own a home in RO and Oak Park. I moved here about a year ago for work and was really surprised. The suburbs are very wealthy and get a really bad reputation from an outdated stereotype. We were in Detroit Friday night for a concert and it felt safer than many parts of Atlanta (where I'm from).

I am targeting flips in RO, and rentals in Oak Park/Hazel Park/Madison Heights. Prices are climbing quickly here though, I bought a home in Oak Park in July for 129 and there is nothing that quality on the market (all listing 135+ already).

DK

Jenelle H. · Answer

Just wanted to check in here with some fellow Detroiter's.  I am reading things about the suburbs not being renter areas, but more buyer areas.  What I've read is that the people who can afford to live in the nicer suburbs wouldn't be renting so much, they'd be buying their properties there.  They said the renters are in Detroit main.  True or false?  What do you think of that?

@Diego Ortega  @Alan Stalter

Jenelle H. · Answer

Thanks folks. I appreciate the insights!  I am looking for a market to buy rentals in and it’s tough!

Detroit for buying rentals?

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