Downriver Metro Detroit Investing - Too good to be true?

Question

Hey guys,

So I am very familiar with Oakland/Macomb County, but recently have been looking into Wayne County.  Specifically the downriver areas (Wyandotte, Lincoln Park, Taylor, etc).  Just by looking at what things are currently listed for (single and multi families), there seems to be good cash flow potential....

For those familiar with these areas, would you consider downriver to be a good investment choice?  How is the tenant base?  Does it differ drastically from area like Lincoln Park, to Taylor, to Wayne?

Any insight would be greatly appreciated!!

Dave McGrath · Answer

@Samuel S.

I've lived in the downriver area for most of my life.  It was considered to be a "blue collar" community, and I think that still holds true.  I am a new member here so I don't have any experience in investing yet.  However, downriver area is where I am looking myself.  Here is my opinion based on living in the area for 30 or so years....

Taylor is a large city, and it has varying housing demographics.  Some areas are very low income and low valued housing (off of Eureka Rd, west of Telegraph), and I would stay away from them no matter how good the deal/potential looks.

Lincoln Park is where I bought my first house.  I grew up there and where I actually bought my first house in 2001 (for$83k and sold for $115k in 2005 before the decline really hit).  I moved because the schools declined drastically.

Allen Park is an excellent area with regards to housing values and schools (excellent).  Mostly middle to upper middle class.  House to rent do not stay vacant very long.  My GFs house was re-rented 4 days after she moved out (rent was $1200/month...and landlord said he had countless applications).

Southgate is another city similar to Allen Park.  Nice houses, decent schools, middle class families.

Wyandotte is an interesting city.  It's on the water, has a thriving downtown that is trendy at time.  Decent schools, too.  The city has its own water, electric and cable company which I've been told is very nice.

Trenton, Woodhaven, Flat Rock, and Riverview are more southern communities that have good potential for investments, as they are considered very good areas to raise kids (excellent schools, higher valued houses).

Areas that I would stay away (or at least be hesitant) are: Ecorse, River Rouge, Melvindale.  Ecorse and River Rouge are extremely sketchy areas with very low income, horrible schools, and higher crime rates.  Melvindale is a sort of hit or miss.  It borders Allen Park, so the houses that are closer are nicer....but as you go further north, it gets closer to Detroit city limits...and it starts to turn ugly.

Message me if you'd like to discuss more.  As I've said, I'm just getting into the real estate investment game and would love to connect to others in the area.

Dave

Courtney M. · Answer

Like a lot of areas in metro Detroit, neighborhood is key. I'm doing some driving in the Westland/Redford/Wayne areas this week and I've discounted great "deals" because of neighbor houses that are dilapidated or SFH in a triplex area. I think there are absolutely great deals to be had - but I'd want to see the street/neighborhood before investing.

Stephen Meche · Answer

@Samuel S. I currently have 2 buy and holds in the areas you have described below and live in Flat Rock.  I am getting good cash flow and i have a good property manager so finding tenants has only taken a couple weeks after I have gotten my Certificate of Occupancy.  The market seems to be tough right now.  I will save a house on the MLS and it seems the next day it is gone. As soon as you think it slows down, 5 or so houses will go up pending.  I was lucky on both of mine and having conventional finance helped me out on my second (i was the lowest offer, but they had just had an offer fall though on financing so they went with mine).  I would agree with everyone else on this post, you have to know the neighborhoods.  You can message me if you need more information.

Jeff Hastedt · Answer

I love investing downriver. Then again, my preferred areas to invest are traditionally blue collar, solid working class areas. I own 3 SFR’s in Lincoln Park and one in south Dearborn Heights on the Taylor border. Lincoln Park is a very solid community and I’m generating good cash flow. I can’t get past the demand in Taylor, most properties(even distressed) are going over asking price.

In terms of appreciation, I have hope for a Lincoln Park. I bought in 2016 for $32k, house is prob $75k on a good day right now. With that said, my first and second investment was in Ferndale and at the time, I was told I was crazy and it wouldn’t  see the growth that Royal Oak had. Those naysayers were clearly wrong. Same with Hazel Park, very blue collar. Now it’s a hot spot in Oakland County.

Lincoln Park, Allen Park, Southgate and Wyandotte are my top choices for a deal downriver. Northeast Taylor has solid housing stock but is very much in demand.

Jordan Jones · Answer

Hi all,

Hi @Kieondre Woody. I own 3 SFRs downriver. 2 in Lincoln Park 1 in Allen Park. I've only been doing it for a little over a year (started 2/2019). So far my tenants have been great. Solid, blue collar people who are responsible and take great care of the houses. Good cash flow. Taxes are a little higher in Wayne County. As a couple other people mentioned, the neighborhood is key. The downriver communities vary drastically, sometimes from street-to-street. Also, Allen Park North of Southfield Freeway is Melvindale School District. South of of the Freeway is Allen Park Schools, which are much better and one of the stronger districts in Wayne County.

I find it's getting tight, though. Prices have really increased significantly the past couple of years. It's getting more and more difficult to find a good deal downriver, in my opinion. But they are still out there. Good luck! Feel free to reach out if you have any other questions.

Jordan

Account Closed · Answer

Like @Courtney M.said, it's really going to depend on the neighborhood.  I've got a commercial retail property on Eureka at Telegraph in Taylor, and things do get quite dicey the further west you go.  There's some pockets in Wyandotte I would look into.

I personally stay away from spots that have continual negative population growth (all of downriver).

I think it's just hit or miss and very neighborhood dependent.

-Dillon McGough

Greg Scott · Answer

Downriver is a big area.

Yes, there is great potential!

and

No, it is a terrible area to invest!

Really it depends on the neighborhood and the deal.   Choose wisely.

Kieondre Woody · Answer

I would love to connect with someone if not all of you about these downriver locations. I had a showing setup but virus is forcing us to get creative!

Jeff Johnson · Answer

Good and bad parts of Wyandotte. There are really nice "historic" homes that have been updated and kept nicely and then there are small, "newer" homes that don't have the charm. Generally speaking, closer to Oak and Biddle are the nicest areas with access to a great little downtown. Everyone from other cities much farther north always comment on the fact they had no idea Wyandotte had such a great downtown.

Omar Azam · Answer

It's been 7 months since this thread was originally posted. Is downriver still a good area? I'm looking specifically at Wyandotte.

Downriver Metro Detroit Investing - Too good to be true?

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