Hello, fellow BP members, Detroit investor here relocating to WI

[Neil Jarman]

Hello everyone,

I'd like to start by thanking everyone at Bigger Pockets for creating this resource. In the past month that I've listened to the podcast, I have transitioned from tentatively considering real estate investment to fully committing myself.

I began as an unwitting investor in Detroit when my girlfriend (now fiancé) and I moved there to buy a house in the property auction. After months of searching, we found a 4 bedroom two story on a corner lot for $500. We spent a couple years learning how to renovate a home, then left the city and left our home in the care of tenants. I fell in love with the whole process, and will be making this my career. I have held many jobs (currently working as a crew lead in commercial construction), and it turns out that I LOVE the hustle! After reaching out to family and friends, I found investment money and a possible partnership.  

We are currently in the Madison area, "house hacking" in a sense-- property managing a home for a friend while living there and maintaining tenants while a portion of our income from the Detroit house pays our rent. My plan is to meet with a few fellow investors in the area, get a sense for what is available, connect with contractors and find my first flip. I would like to remodel and sell a few to earn capital for wholesale deals, then start building my rental portfolio. I intend to utilize the resources on this site for everything they're worth (priceless!) build teams and provide homes to a niche market. After taking small, low cost steps to add value to our Detroit home (in-ceiling speakers, HDMI cable runs from wall jacks, ethernet hookups in every bedroom), I notice that our tenants really appreciate these amenities and I see the results in how smoothly everything else has gone with the relationship.

If anyone would like advice on investing in Detroit, I am happy to share our successes and struggles. It's a rough city that requires active involvement. I also look forward to connecting with all of you in my current market to share resources and information. 

Best regards,

Neil 

[Neil Jarman]

In my experience, in order to develop a property in Detroit, being in the city seems important. Things are changing there, for sure, but outside a couple places (midtown, corktown), it is difficult to hold a property without it being "swallowed up" by the neighborhood. Scrappers still break into any house with any amount of copper, appliances or anything of value. Tenants, other than college students, seem to be hard to manage. Before buying a house, I rented there for years and saw many cases where rent was not paid for months and the tenants left with the furnace and hot water heater on eviction. Or left in the middle of the night. It is important to have an advocate in the city or to be there oneself, and crucial to form relationships with nearby property owners in order to keep something from being trashed. Many houses are in various states of disrepair, and squatters are occupying many of them. 

This is all speaking from my own experience, of course, and an investor may find opportunities that can be taken remotely (such as parcels of land or buying into development). Houses can be bought for cheap, but holding is the tricky part. 

If anyone really is interested in investing here, there are certain areas that may do better than others due to what the city is doing or what individuals have done in their neighborhoods. A light rail system being currently installed, which may increase property values along Woodward Ave, and there are various alcoves of the city where artists or entrepreneurs have begun buying.

If anyone would like advice on navigating the yearly tax auction or has any more questions about Detroit in general, feel free to ask!