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Comment by echelon | Hacker News Reader

How's the real estate in Detroit? Is it too late to invest in good property for cheap?

Expensive downtown and cheap in the neighborhoods, so no, but it's far less clear to me that the neighborhoods will rebound in the way that the downtown area has (nearly all of Detroit's non-gentrified areas are overwhelmingly black, and across the midwest predominantly black neighborhoods have proven quite resilient to gentrification, for better or worse).

Was downtown ever cheap during the downturn? I only remember hearing about fire-sale prices in the neighborhoods... which were already quite low before '08.

A rebound in not necessary for a real estate opportunity to exist. Even poor non-white people pay rent and there are mountains of money to be made in rental portfolios where you would not like to visit, much less live. But it’s by no means easy money - it’s a super competitive market.

While there is no longer as big an opportunity as there was if you bought in 2008-09 people are still doing well.

https://www.freep.com/story/money/business/2018/12/27/detroi...

Very hard to do anything downtown anymore. Or in Corktown (west of downtown) where Ford is remodeling the old train station for their research headquarters. Maybe in Mid-town and definitely in New Center.

An area just beginning to gentrify is East Village. Here's a project an entrepreneur has launched in the Jefferson Chalmers neighborhood which is further east of there:

https://www.youtube.com/watch?v=bapcgs1v62Q&t=4s

Then there's the BMW mechanic and his wife who created a new career for themselves. When the banks wouldn't lend to him his neighbors were willing to do so! This is in the New Center area.

https://www.freep.com/story/money/real-estate/2018/04/14/vir...

There is plenty of cheap property; it is debatable whether any of it is "good."

This is the essence of land in the Midwest. You do get what you pay for, there's no magic to it.

Equating a blighted Detroit to the entire midwest is a bit asinine. Finding no magic outside a coastal bubble might be indicitave of a deeper sentiment you are not airing.

I meant that there was no magic to lower cost of property in the Midwest, not that there was no magic to be found there.

I think you read something into my comment that I did not intend. My comment was specifically about the rundown properties in Detroit that can be had for a song. They are in such a state, however, that you would have to put in tens of thousands of dollars, at least, to make them livable.

There are properties all over the midwest that can be had for a song - run down, in Detroit or not. My sister in law just bought a nice house for 70k in Kalamazoo. That wouldn't buy you a house boat in Seattle.

My point is that if you want to be surrounded by mountains, forests, ocean, high paying jobs, and culture, of course it is going to cost more than the Midwest.

It's somewhat been picked over. If you're looking to renovate tho there is still a lot to choose from. GF recently bought a house for 45k which will need 40k in renovation probably. But recently a house sold down the street for 150k so there is still money to be made.

We’ve been sitting on zero and near zero percent interest rates for 10 years. The only reason any asset would be cheap at this point is all the other buyers attributed it with a decent amount of risk.

New Center, Woodbridge, and North End is where I'm currently investing. Property no where as cheap as 10 years ago but you still see stories like this: https://www.freep.com/story/money/business/2018/12/27/detroi...

If you do, make sure you check for tax liens before buying.

The Midwest has a plethora of good opportunities for investors. It’s not overpriced like most of the coasts. Couple that with qualified opportunity zones and things will be heating up this year.

Starting a fund soon with someone who has made millions in real estate within the Midwest. We intend to help others profit in these markets. Fund isn’t formed yet, we are not soliciting for investors yet. If you want more info feel free to check http://www.activatedcapital.com for updates.

What is the definition of over priced? Are you talking about some actual index here or just thinking in non-quantifiable terms?

Overpriced would mean in comparison to the price of another identical good at the same point in time, but since that is hard to find in real estate, I've always interpreted it to mean that the return on investment will be lower over a certain period of time for an overpriced property compared to another, either in dollar amounts and/or quality of life terms in case you're living in it.

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