Excited to get Started Investing in Properties in Detroit

[Rayisha B.]

Greetings Everyone!

As of lately, my focus has been on how to buy investment property in areas that will make a difference in under-served communities. I grew up in South Central Los Angeles and wanted to invest there but since the prices are so high, I am not able to start there at this time.

So I have shifted my attention to Detroit, MI. I am looking for advice on investing on out-of-state investment properties.

I am ready to purchase my first house or duplex, then do the BRRR method but am concerned about refinancing to pull funds out to purchase another property under an LLC. Any advice here?

[Leroy K. Williams]

Hi Rayisha,  

First Thank You for considering our great city for your investment goals. Detroit is really interesting right now since there is a ton of activity in certain areas of the City namely Downtown, midtown, Liv/6 district, historic neighborhoods, the villages, et al. In these areas things are really hot, however in other core neighborhoods things are relatively static as far as values. I am not sure how well the BRRR strategy will work where values are not really that high and lenders are not likely to look favorably on. So with that said when you get here look carefully at the areas and how they are trending before you buy.

In my view the best strategy for tenanting properties in Detroit is buy and rehab first and then hire a property management company. There is a real science as to why but that's an entirely different topic that is tangential to your post so I will leave it at that.