All Forum Posts by: Mike McClung

I think it's less a question of if, and more a question of how long :wink: My carrying costs are minimal, so I don't have to worry so much about flipping. And I can afford to sell it below market value.

But I'll be sure to update here. A plan is a plan, and reality has a tendency to make hash of plans....

TC-

You forgot total rewiring :D

You're absolutely right in 99% of the cases in Detroit, too. You don't get something for (almost) nothing, which I learned when I first decided I wanted to start investing and chose Detroit as my petri dish. I spent about $1,000 on property inspections for prospective purchases, to see what I would be getting into (considered it the price of doing business from thousands of miles away). The inspections turned up exactly what you're talking about- rotten roofs, AWOL plumbing, AWOL bathroom fixtures detached garages about to fall in on themselves, basements taking in water, outdated/missing furnaces/water heaters, nightmare rat's nests of outdated electrical wiring.... The list goes on and on. I'm glad I spent the money.

As for neighborhoods, that's much harder for me to judge from a distance, since I'm originally from Texas, not Michigan. I have to rely on what other people tell me/what research tells me.

Oddly enough, all this hasn't put me off Detroit. I've enjoyed the learning process immensly (which makes my wife doubt my sanity even more than she did before), and it made me keen to find that one REO house that, while not perfect, is not a money pit about to collapse. Which I think I've done. More importantly, at some point you have to stop dreaming and scheming and start doing.

The bank has accepted the offer of $7,500 on the house I chose. Roof is new, wiring is new (new = less than 5yrs in my book) interior of the house is in good condition if dated, detached garage will not fall in on a car parked inside, basement is not an indoor pool when it rains. Yes, it'll need a new furnace and hot water heater, some plumbing, and the like, but even taking a dim view of neighborhood comps, purchase price plus repairs minus sale price should see me net $30k. Which to me is worth sifting a lot of sand to find a gem.

And if this all works roughly acording to plan, then I'll be able to take that money and start sifting sand in the $10,000 to $20,000 range...

Mark,

Wow, you really know your stuff! I've really taken a long look at the Detroit market over the last couple of months, and decided, due to my particular strengths and weaknesses, to go into single-family housing with a buy and hold mentality.

When you spend enough time sifting through the REO housing in Detroit, out of the hundreds that are not worth investing in (for me at least), there are a few priced under $10,000 in decent neighborhoods that involve only minor renovations. Not having to carry a mortgage on these allow you the ability to sit on the sidelines without the pressing need to rent.

Now I'm off to read your blog!

Mike

Thanks PNW, Mr Castillo.

I guess I was trying to make the idea too general :oops: .

More specifically, when I search the Wayne County Tax website using property ID numbers gained from Zillow, I sometimes come across properties whose status is "forfeited", and others whose status is "delinquent". I assume (already in trouble, aren't I?) that in the first instance the property has already been taken by the county, and in the second, a lien has been placed on the property. if this is true, then I could buy the first property outright, and the lien on the second.

But I realize now what I need to do is talk to the county, not pester you guys about knowledge I can find out for myself. :idea:

Mike

Hi John,

I did poke around, and it did clarify matters some. Thanks!

Hi all,

I suspect my understanding of liens is faulty, otherwise someone else would probably be doing this already:

Search county tax rolls (many of which are online) to find delinquent/forfieted tax properties in areas you like. Pay the tax, place a lien on the property for the tax amount, then eventually either get the property or get reimbursed the tax amount.

Downside I can see is that it might be a junior lien and get wiped out in forclosure/bankruptcy.

Thoughts? Gentle mockery? Outright laughter?

Ryan,

Thanks for the info. Sounds like there *are* opportunities there, but a fair amount of risk as well. Unless I can put 'boots on the ground', I'm afraid I'm bordering on speculating...

But I come back to the fact that some of these houses --good, solid houses-- are practically being given away on the REO side... :crazed:

Hi all,

I'm a newbie out-of-country investor (American living in Singapore). Been using the internet to check out REO markets across the US, and Detroit keeps coming up where you can get the most house for the least money.

I know that Detroit has been stuggling for a long time, and that it's likely that any property I buy will not sell fast, but if I buy low enough, should that really matter?

Would welcome any thoughts or observations.

Hi Joshua-

Short answer, I'm here because my wife is here :wink: She's a lawyer here in Singapore. Yes, I'm looking at investing in the US. We have a couple of properties here, a house and a commercial property, but the real estate situation in Singapore is hair-raising. Not because of shadyness or anything (very much rule of law here), just because property is so darn expensive. The Singapore real estate market is fascinating, actually, but that's another topic for another time :)

Mainly I'm starting to look at investing in the US because of the weakening US dollar, and because of long term issues to do with education and national service issues for our 3 year old son. We have a comfortable life here, and when/if we move back to the states, We'd like to maintain it.

Hi Tim-

Yes, they're building 2 casinos here, a Sands with convention center on the main island just south of the central business district on reclaimed land, and another spearheaded by local Genting Goup on smaller Sentosa Island (sort of a resort/park/ golf development island linked by bridge and monorail) which will include a theme park.

Funny thing is, Singapore has resisted having casinos for decades, afraid of turning into another vice-ridden Macao. So the politically correct term for these developments is not casino, but Integrated Resorts (IRs for short) :D

Hi there. I'm an American living in Singapore. With the exchange rate becoming more favorable, I've decided to explore something I've long wanted to do - invest in real estate!