There was a time when my investments in Detroit real estate were mentioned at family gatherings only with light snickering and then everyone hurriedly changed the subject. Those days are gone. Now, there is always a nephew or cousin who asks about the Detroit real estate market with sincere interest and heads turn to listen to what I say. That’s because my answer is more enthusiastic every time—and with good reason. The last time we had a get-together, my favorite niece Deb turned to me and asked, “Should I invest in Detroit, too?” I told her about my experiences and a recent conversation I had with veteran Detroit investor Sami Abdallah. In short, I told her that this is an excellent time to invest in Detroit as the city’s recovery is really beginning to take hold, though the competition is getting stiffer all the time.
Why Should I Invest in Detroit?
Detroit was hit hard by the pull-out of the ‘Big Three’ automakers and that left our city in a particularly vulnerable state when the housing crisis hit. It took some struggling to come back from that double wallop, but now we are seeing the results of our efforts. One of the most dramatic signs of Detroit’s economic recovery has been the rapid growth of the housing market. A combination of three forces are driving this expansion:
Technology companies are especially prominent among the city’s new corporate citizens, some of whom have moved their regional offices downtown from the suburbs, including Google, Accenture, and Microsoft, while others came from further afield. Silicon Valley–based LinkedIn, for example, has opened its newest office in downtown Detroit. These companies bring with them stable, well-paying jobs for local residents and draw in workers who move to Detroit for new employment opportunities.
Government programs across the Motor City have had notable success fighting blight in residential neighborhoods. The Detroit Land Bank has cleared away acres of abandoned or decrepit houses and sold others at accessible prices to investors willing to restore them. The land bank has also instituted the Side Lot Program, allowing people to buy vacant property adjacent to their own for a nominal sum, thus encouraging the creation of new gardens, landscaping, and outbuildings that add to the attractiveness of a neighborhood and the value of a property. Overall, the ongoing campaign to wipe out blight is restoring many neighborhoods to places where people are glad to live, and this transformation is reflected in rising property values.
Foodies, art installations, tech startups—these things are part of life in many American cities and their emergence in Detroit shows how normal the city is becoming again. Add in our Motown history, the Pistons, and Detroit’s reputation as a gritty survivor and we have become hip as well. Detroit’s style powers local small business, draws tourists, and gives the city the prestige that it has lacked for a long time now. My colleague Sami calls it our ‘brand,’ and, like all brands, it has its own value, both intangibly as civic pride and quite tangibly as economic stimulation and population growth.
Put this all together, and you have a real estate market that is jumping up the charts. I watched Detroit climb Realtor.com’s hot market lists this summer, from 16th place in May to the #7 spot in July. It was hard not to stand up and cheer. With the city’s new employers, some pretty neighborhoods, and local pride, Detroit is on its way to a long-awaited brighter future.
While buying, rehabbing and selling houses around Detroit is getting hotter right now, I am still diversifying my real estate portfolio by acquiring rentals as well. With the city on a positive trajectory, this long-term view makes sense and we are already seeing rents rising. But, Detroit is big and the rent that an investment property demands differs widely among neighborhoods. I personally am seeing the most opportunity in Boston-Edison, Warrendale, and Corktown. Sami says that he is also focused on Indian Village, the University District, and Rosedale Park. These areas require a somewhat higher initial investment, he said, but the potential for returns is worth it.
While new opportunities for real estate investing are opening up every day, the good deals can get snatched up fast. That’s why you need direct access to qualified leads if you want to grow your real estate portfolio in Detroit quickly. Luckily for Sami and me, that’s not a problem.
Finding the Best Investment Opportunities in Detroit
Being independently owned and operated HomeVestors® franchisees, Sami and I receive calls straight from motivated sellers who need to sell their house fast. Homeowners know who to call when they need to sell because they’ve seen the nationally-known and trusted “We Buy Ugly Houses®” marketing campaign on billboards and commercials regularly. In fact, marketing has helped franchisees like us buy over 100,000 houses since 1996. With this kind of marketing power behind us, we can stay ahead of the growing competition in the Detroit real estate market. That is what I told my niece Deb, and all the relatives hovering around us.
Now is a great time for investing in Detroit real estate, but if you’d like qualified leads to boost your business call the “We Buy Ugly Houses®” team today.
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