Detroit buy and hold

[Lydia Woods]

Hey Ladies and Gentlemen’s,

I live in Louisiana but I’m thinking about buying some property in Detroit.

I notice they have a lot property on the low end ($3,000- $10,000) and some are bundle deals. They are in low income area. But I was going to buy and hold without renovations and sell down the line.

This will be my first time doing this strategy. I’m looking for input, did anyone buy property in the low-income area of Detroit ? Have you every did this strategy? Anyone familiar with Detroit market or the future it may hold?

All advice are welcome. Thank you

[Yoann Dorat]

@Lydia Woods, I know people who tried this before in Detroit, they all end up selling at a loss a few years later for 3 reasons. 
1. The city doesn't want those eyesores anymore, so they will bury you under blight tickets. You could declare it has vacant but you will be required to secure all windows and doors, install floodlights and maintain the landscaping on a regular basis.

2. The holding cost, even though it's vacant it's still costing you money every month, you have to keep it clean (#1), pay the property tax, insurance (pretty big risk it gets burned down), even if you make X3 in 20 years by then you'll probably have spent the same amount in holding cost. 

3. It's a pretty big city, Built for 2M people and now down to 637k some neighborhoods are coming back, some never will. $3000 to $10000 houses are probably in the part that never will, but maybe it will it's a gamble. 

I personally look for solid/steady cash flow instead of gambling on appreciation so my advice would be to look into a better neighborhood and buy a stabilized asset. 

Good luck,