I am Pro Detroit but not ready to invest there yet.

[Scott Mac]

I posted this for discussion on the investment aspects of Detroit.

I am very pro Detroit, but not ready to invest there yet--too many problems.

I think it has a ways to go before I'd be comfortable investing there.

===

So many fixers, so much space for strip malls, if this were Austin, these places would sell for a Mint of money.

So many duplexes, all brick....

So many apartment buildings--all brick...

Too bad it's so Dangerous there.

===

Also I think it would be interesting to have a monopoly sized map of Detroit, and move all of the remaining (un-burned down) little houses and apartments into one area.

Put them on the Vacant lots and see how how really small Detroit is, if it were once again a city of homes side by side vs the acres and acres of burnt out lots with homes scattered in all directions. Condense the population so to speak into one proper town with new strip malls, and medical service areas---plus figure out what kind of work suits them and bring some of it there.

Might be easier to (weed out) the criminals if there were in one city of side by side homes, vs so spread out--and put a new BIG men's prison, women's prison and kids prison in that area too--and get rid of the crime.

===

Here a a couple of video tours:

[1] Class D Business District Tour: https://www.youtube.com/watch?v=u2qdMxzJsXY

[2] Class D Residential District Tour (Lots of Fixers here): https://www.youtube.com/watch?v=u_rIv55jEq8

===

Any comments, observations, experiences, etc...

[Joe Hammel]

What is the bottom line for everyone in real estate investing? Passive income and a great ROI.

This is exactly what I (and so many others) have in Metro Detroit.

Drew said it well above.. "you're making a common mistake..."

Essentially by lumping in all the bad locations with the entire area...you (and many others) miss the sweet spot.

This is how so many people "see" Detroit. They only see Detroit as Vacant lots or burned houses and nothing more. In the mean time. I have a portfolio of houses in METRO Detroit that cash flows $300-$400+ a door and I've DOUBLED my equity in 3 years and it's very easy to manage with paying tenants. You can't tell me I've done poorly. I've used the cash flow to retire my parents. They don't work anymore because I have enough consistent cash flow to cover their needs. Did I fail? Nope. I've executed what everyone in Real Estate Dreams of, because of how good the investments are in Metro Detroit. 

Trust me, I'm NOT buying $10k-$20k houses in D markets. Those are the horror stories.. but there are near 100 individual cities within 50 mile radius of Detroit. Lots of people do make money buying in the up and coming neighborhoods of Detroit (a more difficult strategy) and I personally don't own a property IN Detroit, but my entire portfolio is in the suburbs bordering Detroit. 

Franklin, MI. A city just outside of Detroit... has an average home price of near $1,000,000. Is that a bad location? 

The locations I/we invest have an average price of $150k and I purchase the properties in the lower percentile and do extremely well.

The price/rent ratios are the best in the country. The sweet spot is the 1.2-1.4% deals. They cash flow so well and are in good working class locations. 

And on top of the great cash flow, i've personally seen double digit appreciation. The data doesn't lie.

Attached is an example of one of the cities I have a rental in. Oak Park. 24% average annual appreciation for 10 years straight. Paid $125k. Rents for $1500. Solid appreciating location. Average price in Oak park is $200k and I paid $125k for mine. Bought a solid house in the lower percentile and it cash flows extremely well and will continue to appreciate.

Just in metro Detroit there are over a DOZEN fortune 500 companies with Auto, Hospitals, and Mortgage industries leading the pack and supplying a lot of jobs. 

Metro Detroit is the best place in the Country to invest for the typical investor looking for passive cash flow and a good ROI. Prove me wrong.