Buying Property In Detroit
The best way to start the process of applying to purchase publicly-owned property is by filling out an application here. The same application form is used by both the City of Detroit and the Detroit Land Bank Authority. You may apply to purchase any property owned by the City or the DLBA, even if it is not marketed for sale.
buying property in detroit
Before applying to purchase property, please be sure that you or the organization you represent have no outstanding personal or corporate income taxes, property taxes (check here), or blight violations (check here). If you are proposing a ground-up development or extensive structural rehabilitation, please provide at least a conceptual plan identifying the proposed use of the property, the scope of work, estimated costs and financing sources, and prior experience with similar developments. These additional documents can be digitally uploaded when filling out the Property Application Form.
To help rebuild property values in the city, encourage the development of a healthy real estate market, and promote fairness and transparency, all property is generally sold at market value. When applying to purchase property, please bid a competitive rate. Extremely low offers that are below market value will generally not be accepted. Credits are sometimes provided for adjacent property owners, property sales that will encourage job growth or provide affordable housing, and for local non-profit organizations.
The DLBA created the Community Partner Program to encourage faith and community-based organizations to help stabilize and transform their neighborhoods. Previously-approved Community Partners interested in purchasing DLBA-owned property should use the Property Application and indicate their status as a Community Partner. To learn more about the Community Partner Program and to apply to become a Community Partner, visit the DLBA's website.
You are strongly encouraged to review the zoning requirements for the property you are interested in purchasing. To determine the zoning classification for the property you are interested in purchasing, refer to the zoning map index. You will then be able to use the zoning portal tool to confirm which uses are permitted at that property. Generally, the City does not sell property if the proposed use does not comply with the zoning code. However, if you think that your proposed use of the property is a good fit for the location despite possible nonconformance with the zoning code, please apply using the Property Application and note the potential zoning issue. Proper zoning approvals for the proposed use will need to be in place prior to closing.
For commercial property, if approved by the City and a price agreed upon, an earnest money deposit of ten percent (10%) of the purchase price is to be paid in certified funds to the Detroit Building Authority at the time of the purchase agreement. The balance of the purchase price is due at closing either by wire transfer, certified funds, or cashier check.
If you are interested in purchasing property owned by the Michigan Land Bank Fast Track Authority, please visit their websiteIf you are interested in purchasing a property from Wayne County or at the Wayne County tax auction, please visit the Wayne County Treasurer website
Copyright 2001-2023 by City of DetroitFor information about the City of Detroit's Web site, email the Web Editor. All material is the property of the City of Detroit and may only be used with permission.
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Detroit is an excellent place to invest in for both cash-flow and property appreciation. Local, out-of-state investors, and even international investors are targeting the incredible opportunities of the Detroit rental market.
Detroit is a unique market. Real estate trends are at record low prices with plenty of property availability and a tremendous cash flow advantage. Buying at low prices with the potential for high returns creates the perfect purchase opportunity for serious investors.
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The increase in home prices is an indication of potential value appreciation, while housing affordability is an indicator of the potential demand for rental property in Detroit and other real estate markets.
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Jeff has over 25 years of experience in all segments of the real estate industry including investing, brokerage, residential, commercial, and property management. While his real estate business runs on autopilot, he writes articles to help other investors grow and manage their real estate portfolios.
But vacant land presents a number of opportunities for you and your neighbors. Building something beautiful or useful can improve the health of residents, creating places of rest and activity. It also discourages illegal dumping and raises property values.
One advantage of investing in real estate in Detroit is that property prices are extremely low and you can therefore buy real estate at a much lower price compared to most other major cities in the US.
Not only property prices are pretty low, but also rents in Detroit are still affordable for most people out there and this is great for you as a real estate investor since it means that people might be willing to spend more money on housing in the future and you may therefore be able to increase your returns in the long run.
Since property prices are pretty low, the average person is still able to buy a home and this indicates that the property market in Detroit is not overheated as in most other big cities and while the housing bubble may burst and people who buy property in San José or other expensive places may suffer great losses, you in Detroit will most likely not have to deal with this issue that much since you will buy at a relatively low level and your downside risk will be much lower.
Another reason to buy property in Detroit is that due to low property prices, there is still plenty of room for price increases in the future and this may boost your internal rate of return in the long run.
Since Detroit property prices are pretty low, many people from more expensive regions like Cleveland or Chicago consider moving to Detroit to save lots of money on housing in the long run and this may boost overall demand for property in this region in the long run.
Since property prices in Detroit are extremely low, it is also hard to imagine that they might fall even further and this means that your downside risk will be pretty low while your potential future returns may be enormous in case Detroit becomes more popular and housing prices may explode due to that.
However, Detroit is still a big city and times may change and in case this happens, you can get huge returns on your investment by investing in real estate in Detroit right now while property prices are still cheap so that you can benefit from a solid long-term development.
Unlike people buying property in San Diego or in other tenant-friendly cities, you will also not have to deal with rent control in Detroit and can therefore raise rents as much as you want to so that you get to market level pretty quickly and can maximize your returns in the long run.
Detroit is not only an attractive city for private real estate investors, but also institutional investors may buy huge pieces of land to speculate on future price increases and this may boost property prices and rents in Detroit in the near future.
However, there are also many drawbacks of investing in real estate in Detroit that I want to address in the following chapter so that you are better able to decide whether you still want to invest in Detroit property or rather want to buy real estate in a different region.
Another disadvantage of buying real estate in Detroit is that there are also many dodgy neighborhoods in this region and if you buy in the wrong areas, it may be almost impossible to rent out your properties for a decent price since nobody wants to live in those dodgy quarters.
Unlike most other big cities, Detroit experiences a decrease in population and if this trend continues in the future, overall demand for housing may decrease as well and this will likely cause property prices and rents to drop even further.
Since you will have to accept many dodgy tenants due to a lack of good alternatives, you will also be at significant risk of tenants messing up your property and you may therefore have to spend lots of money on renovations in the long run.
Detroit can be a great place for property investors since property prices are still extremely low while rental yields are excellent and you will be able to build a positive cash flow rather quickly. However, you also have to deal with many difficult and unreliable tenants and Detroit also has a rather questionable future outlook.
While the city of Detroit seeks bankruptcy protection, a local billionaire businessman is on a real estate buying binge. Since 2011, Dan Gilbert has bought more than 40 downtown buildings, and seems to be collecting more each week. 041b061a72