gura said:
I don't understand why you pay so much for properties in Detroit.
you can buy properties that generate rent of $650 for 20-23k with %19 Net.
The reason the good investments are so much more expensive is because these are generally in better neighbourhoods and have been fully refurbished throughout the property.
The more expensive investments also have clean titles so no worries about outstanding debts on the addresses.
These are also fully managed and tenanted.
Investors are seeing yields up to 24% and of course by taking advantage of the current climate and the BMV market in the U.S the natural appreciation of the property as the economy recovers over time.
I have seen firsthand some if the $5,000 - $9,000 properties being offered and these properties are all but destroyed.
They are in very run down, poor neighbourhoods.
All pipe work has been stripped along with any other metals, they have had walls smashed through all glazing gone . They are for all intents, derelict.
If you have the time to base yourself in Michigan and manage and project manage the refurbishment yourself, this may be feasible but surely it makes more sense to deal with some of the 'good' brokers and pick up a much, much simpler product already for you to hit the ground running and collect rental income from month 1?
I do understand that people see these cheap properties and maximise on the market but if you are looking for quick returns speak to Crystal about 12 month social housing projects offering 20% yields.
If you want to build your portfolio with proven properties and good yields then Detroit is the place to buy.
Investments should be like watching a tree grow.
I have seen properties in very desirable areas for under $40,000 that were sold two years ago for more than double this figure and it will return.