Of course, we are all aware of the financial collapse that has slowly taken place in Detroit over the last decade. The city has been left in the unusual circumstance of becoming the caretaker for thousands of abandoned houses. In some cases, the homes have been bulldozed - entire neighborhoods were simply demolished. The remaining empty homes are now being auctioned off with hopes that people will return to the city, stake their claim, and become part of its next chapter.
You can browse the available inventory of homes and even register to bid online.
Rules (from the website) -
Who can bid?
- You must be a Michigan resident or a company or organization authorized to do business in Michigan.
- You cannot have lost property to back taxes in Wayne County in the last three years.
- You cannot have material unresolved blight or code violations in the City of Detroit.
- Any bidder who misrepresents himself on these qualifications is subject to loss of payments and/or property.
- In addition, the Detroit Land Bank reserves the right to exclude bidders with a history of delinquent taxes or code violations.
How to Bid
- Each property will be open for sale for only one day. Bidding will be open from 9:00 a.m. until 5:00 p.m.
- If any bid is made within the last 5 minutes that bidding is open, the closing time will be extended by 5 minutes.
- The bidding will open at $1,000.00. All bids must go up in increments of at least $100.
- To bid, click on the property that you want and then click on “Bid Now”.
- The amount of each bid submitted will be posted immediately on the screen, so that the public knows the current bid at all times, together with the Bidder Name of the current bidder.
- The DLBA reserves the right to reject any and all bids and either remove a property from auction, or reopen bidding on it at a later date.
There is clearly a major string attached to these bargain priced homes; they want the homes brought up to code quickly and they want someone living in them within six months.
While no one knows the future of Detroit, it is highly likely that it will reinvent itself and become a thriving city again some day. This opportunity really reminds me of a modern day version of what happened when the western United States were settled. Now, in this case you are not just staking a claim on a piece of land, but there is a home already built there.
What if I am not a resident of Michigan?
One final point to note. You may have read in the rules above that in order to bid you must be a Michigan resident or be a business that is authorized to do business there. Even without officially becoming a resident of Michigan (which would probably be fairly easy if you wanted to move there), a person could set up a small corporation for the purposes of bidding on and acquiring one of these homes. It seems that the rules even allow for the corporation to be one formed in another state as long as it is also registered to do business in Michigan.
While the opportunity to buy these abandoned homes appears to be directed toward owner occupied scenarios, I see nothing in the rules that would prevent a person from buying one of these homes with the plans of renting it out. Here is an interesting article that points out the stellar returns on rental real estate in Detroit. I found another very interesting press release outlining how one Utah investor is snapping up Detroit homes at quite a rapid pace.
One other important point to make here. Even if you don't buy a home from this particular auction, there are others. There are also numerous other bargain priced homes available from banks and sellers directly.
Helping you make the most of God’s money!