Less than zero: Lots of Detroit properties worth even less than $1 asking price
Filed under: Home, Real Estate
You might blame the fact that houses in Detroit's drug war-torn neighborhoods are going for $1 (plus closing costs and thousands in back taxes) on the foreclosure crisis, but the reality is grimmer and probably more permanent.Although the Detroit News featured the $1 sales on its front page, these kinds of giveaways have been common in East Coast cities for the last 30 or 40 years as a way to unload property with no market value in their current condition.
I took one of them 30 years ago from the city of Wilmington, Del., in return for agreeing to fix it up and live in it for three years. My oldest son's first word was "Ralph," the name of the plumbing and heating contractor who spent more time than his father at our perpetually under-construction home.
But at the end of those three years worth of dust and sweat, we sold the place and cleared $25,000.
I doubt that a property giveaway in Detroit would have such a happy ending these days.
I wrote a story six years ago for the online magazine of the National Trust for Historic Preservation on a neighborhood near the one featured in the Detroit News. Houses in both areas are similar -- a basically attractive mix of early 20th-century homes, including Dutch colonials, Tudor revivals, and Arts and Crafts bungalows. At the time, rapper Eminem wanted to burn down a few of them for his movie, "8 Mile." Nobody protested much because nobody cared.
Real Estate Troubles
WASHINGTON - JULY 27: (AFP OUT) President George W. Bush arrives at the White House after a bicycle ride July 27, 2008 in Washington, DC. President Bush has said he will sign a mortgage relief bill, allowing homeowners to refinance with government-backed loans rather than foreclosing, that the Senate approved yesterday in a rare Saturday session. (Photo by Dennis Brack-Pool/Getty Images)
Getty Images
ALTADENA, CA - JULY 25: (FILE PHOTO)A foreclosed home is up for sale July 25, 2008 in Altadena, California. During a weekend session of the Senate congress passed aon July 26, 2008 in Washington, DC. During a weekend session of the Senate congress passed legislation to aid failing mortgage companies Fannie Mae and Freddie Mac that would allow homeowners to escape foreclosure by getting the chance to refinance into more affordable loans backed by the Federal Housing Administration on July 26, 2008 in Washington, DC. The $3.9 billion bill would aid neighborhoods devastated by the housing crisis buy and fix up foreclosed properties, helping an estimated 400,000 homeowners. (Photo by David McNew/Getty Images)
Getty Images
STOCKTON, CA - APRIL 29: (FILE PHOTO)An abandoned home stands behind a padlocked gate April 29, 2008 in Stockton, California During a weekend session of the Senate congress passed legislation to aid failing mortgage companies Fannie Mae and Freddie Mac that would allow homeowners to escape foreclosure by getting the chance to refinance into more affordable loans backed by the Federal Housing Administration on July 26, 2008 in Washington, DC. The $3.9 billion bill would aid neighborhoods devastated by the housing crisis buy and fix up foreclosed properties, helping an estimated 400,000 homeowners.(Photo by Justin Sullivan/Getty Images)
Getty Images
STOCKTON, CA - APRIL 29: (FILE PHOTO) A foreclosure sign sits in front of a home for sale April 29, 2008 in Stockton, California. During a weekend session of the Senate congress passed legislation to aid failing mortgage companies Fannie Mae and Freddie Mac that would allow homeowners to escape foreclosure by getting the chance to refinance into more affordable loans backed by the Federal Housing Administration on July 26, 2008 in Washington, DC. The $3.9 billion bill would aid neighborhoods devastated by the housing crisis buy and fix up foreclosed properties, helping an estimated 400,000 homeowners. (Photo by Justin Sullivan/Getty Images)
Getty Images
A worker installs air conditioners at a new office building construction site in Jakarta July 23, 2008. While global investors shirk at anything property-related after the U.S. subprime mortgage meltdown, Indonesian developers are possibly Asia's best kept secret, because brisk home sales contradict share prices that reflect a market crash. Picture taken July 23, 2008. REUTERS/Beawiharta (INDONESIA)
Reuters
Labourers work at an apartment construction site in Jakarta July 21, 2008. While global investors shirk at anything property-related after the U.S. subprime mortgage meltdown, Indonesian developers are possibly Asia's best kept secret, because brisk home sales contradict share prices that reflect a market crash. Picture taken July 21, 2008...REUTERS/Crack Palinggi (INDONESIA)
Reuters
A labourer drills holes at an apartment construction site in Jakarta July 21, 2008. While global investors shirk at anything property-related after the U.S. subprime mortgage meltdown, Indonesian developers are possibly Asia's best kept secret, because brisk home sales contradict share prices that reflect a market crash. Picture taken July 21, 2008...REUTERS/Crack Palinggi (INDONESIA)
Reuters
A labourer works at an apartment construction site in Jakarta July 21, 2008. While global investors shirk at anything property-related after the U.S. subprime mortgage meltdown, Indonesian developers are possibly Asia's best kept secret, because brisk home sales contradict share prices that reflect a market crash. Picture taken July 21, 2008...REUTERS/Crack Palinggi (INDONESIA)
Reuters
A labourer works at an apartment construction site in Jakarta July 21, 2008. While global investors shirk at anything property-related after the U.S. subprime mortgage meltdown, Indonesian developers are possibly Asia's best kept secret, because brisk home sales contradict share prices that reflect a market crash. Picture taken July 21, 2008...REUTERS/Crack Palinggi (INDONESIA)
Reuters
A palm tree is reflected on Countrywide Bank Home Loans branch window in La Canada Flintridge, Calif. on Thursday, July 24, 2008. A federal grand jury is investigating mortgage lenders Countrywide Financial Corp., New Century Financial Corp. and IndyMac Bancorp Inc., a person familiar with the situation told The Associated Press on Thursday. (AP Photo/Damian Dovarganes)
AP
Not the sort of city likely to attract even the most committed urban pioneers.
They filmed "RoboCop" in Detroit 10 years after the racial riots destroyed big sections of the city in the 1960s. No set designers were required.
Earlier in this decade, it seemed like things were improving. But the decline in auto industry-related jobs have hit city residents hardest. These days, copper pipes are worth more than the foreclosed and abandoned properties.
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Reader Comments (Page 1 of 5)
8-14-2008 @ 4:05PM
Sandra said...
I am originally from Baltimore and the $1 homes has been going on there for years. There has been much controversity such as the drug dealers were buying the homes with their profits and then mistreating the tenants and such. The most important thing as was noted in this article is the neighborhoods were so bad that even at a $1.00 not a neighborhood you would want to be in after dark.
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8-15-2008 @ 6:59AM
jamie said...
there a company in detroite that needs to sell for 50 cents its as run down as theses old houses and poor people are forced to work there im a former maintance man from this company i was fired because i made a few suggestions on how to fix and make it a little safer the company name is ....drye custom pallets..other than payn off osha someone else needs to look into this place...oh yea and really needs to check for green cards these poor people dont know the danger there are facing working for a greedy slave master
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8-15-2008 @ 7:11AM
Tammiem said...
I am sure it makes you feel good to blame whats been going on in our US of A on black leaders...who is in the White House? Good Ol Country BOY..who has been in office for the last 8yrs. Oh yes,that's correct ..tax cuts for the wealthy(that will SURE keep the gov off of your back). What else is the Black leaders fault?Did you say keeping the illegal immigrants...sure,sure I forgot they are doing this also. Oh by the way crime is everywhere...just so happens it's more reported from the media about Blacks committing crimes. Hmmmm..I wonder why that is? I know how to find the answer to that...Why don't someone contact FOX News. I'm sure we'll get an intelligent and honest answer.
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8-15-2008 @ 8:04AM
Meg & Nick's Mom said...
As a person that lives in a suburb of Detroit, I am offended by comments within the article and from other readers! Not all of the city is drug infested and bad, there are beautiful sights to see and wonderful hospitals that save lives. To all of the narrow minded people...come to Detroit and experience how great it is!
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8-15-2008 @ 8:50AM
Dawn said...
I just do not understand why racism is still prevelant! There is no positive aspect to name calling and blaiming others. People are people no matter what color, we all have the same wants and needs. I do agree that illegals should be shipped out of the U.S. and extremeist should do the same. Money should also be kept in our country to help our own, not sent overseas. As for welfare, I have to take drug tests to secure and keep my job, welfare receipants should have to do the same, if you can not pass the test, you get no benefits, and your kids are sent elsewhere. We do need reform and change, but it has to be the right kind.
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8-15-2008 @ 8:53AM
Christy said...
How did this turn into a racial debate?? And where do you get that idea about "Oh, by the way...crime is everywhere, just so happens it's more reported from the media about blacks commiting crimes"??? I'ts more reported by the media when blacks commit crimes because there's MORE TO REPORT! And just so you know, it is not AT ALL racist to say so. It is a FACT that blacks are a minority race in this country but still manage to be a majority in the "criminal" population. That is not racism, that is fact. Check your statistics before you blurt out ignorant untruths. I am not a racist, just a realist. If you are a sorry, lazy, peice of trash, I won't like you no matter what color you are! Believe me, I don't blame it all on the blacks, I blame plenty of it on the justice system which feels sorry for criminals and slaps them on the wrist and sends them back out into our society. I also blame Bush and all of the ignorant Americans who voted for him the first time, and the even more ignorant Americans who RE-ELECTED him for a second term! Bush is a theif, and a liar, and has been bankrupting this country for 8 years now! Everyone hates Bill Clinton just because he cheated on his wife. So what! Thats her problem, not ours, and millions of men and women cheat on their spouses every day! He did an awesome job as president and that is all that matters. Our economy and our country's government were in a surplus status during his entire presidency, and Bush managed to put us into a deficit in just a couple of years. Now you people want Obama to run our country?? You think things are bad now? Just wait until he's elected. There will be change alright, but not the kind we need. Obama won't wear the American flag pin, won't put his hand on his heart and sing our National anthem! He hates whites and hates America. He is not an American by birth, or at heart! What is wrong with you people??? McCain may not be perfect, but he's a hell of a lot better than Obama! I agree COMPLETELY with Claire...I WANT AMERICA BACK!!!
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8-15-2008 @ 9:54AM
Odessa Bradford said...
I am extremely patriotic..but I would not wear an American flag pin on my clothing. I am an African born in America because my great great great grandfather and grandmother were bought here by the slave trade industry. I believe we have a great deal of tolerance considering we are still being judged for the inequities that exist in America.
Barack Obama is no different than any other African born in America. However, he has transcended the ethnic line. WE will rebuild the country with hard work and new vision.
How experienced were the founding fathers?? They had a vision for the future. We will not have a country if change is not made soon.
8-16-2008 @ 12:03PM
heart said...
well christy you were on the right track for somethings,but you conflicted yourself from bush to obama to mc cain which bush and mc cain are two of a kind, you or confused just like a lot of other commentors of the white race. i find that most of you guys oviously dont live on earth or inside of a box, when comes to the black perspective, because we set the pace for everything from fashion,dance our speech of quick wittedness even to the way we shake hands, we are so carismatic in the way do things ,and we are definitely out of the box thinkers, we have to be, taken away from our true beautiful homeland to here to take on western way of life that is not ours in the beginning, that has everyone in such mental state of confusion. i think we"re hated because everyone wish they was us always imitated but never duplicated. you know what, we"re all immigrants, some by choice and some by ruthlessness, hate ,and greed. alot of you writers, news host and just everyday opinoinated poeple you guys know so much why dont you run for an office and let us here more about ignorant agenda. BELIEVE ME IT ISNT MORE OF THE AFRICAN AMERICANS BUT YOU GUYS,lets keep it real why dont we!!
8-15-2008 @ 8:54AM
david said...
Detroit point blank is the worst major city in the country. Right behind it is Camden, New Jersey. Its not the race of the people living there, it's the drugs and poverty. We don't need the war on Iraq, We need a war on poverty.
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8-15-2008 @ 8:56AM
JRoxanne! said...
I agree with Meg and Nick's Mom. I live in a suburb of Detroit. It is virtually impossible to make an accurate assessment on that for which you are intellectually deficient and therefore use unreliable, third party sources such as tabloid media and/or individuals who have initial biased opinions regarding matters of importance yet use these so-called opinions and reporting in such a way that it will lead to division by those who are ignorant regarding the subject matter. Detroit is not entirely drug infested. The great majority of cities and towns and all of the major cities have some experience with drugs permeating their communities. One accuracy that this reporter negated to inform the reader is that a great majority of the drugs "in Detroit", the john's "in Detroit", and the drug runners "in Detroit" originate from persons who live in the suburbs!!! I am a relatively young, 38 years-old, black woman with a college degree as is my equally relatively young, 33 year-old black husband. With the exception of two people in my extended family, as they are still matriculating in college in their senior year respectively, all of us, including my 90 year-old-grandmother, mother, father, aunts and uncles have AT LEAST a bachelor's degree. Half have a Master's degree and a third their doctorate. We are all black. What is troublesome to me is ignorant people who take a situation, scenario, issue or what-have-you, and turn it into a race issue. It doesn't matter if one says some, most, all, etc. it's the fact that it is brought up at all that makes it an issue. The commonality that I see regarding a great majority of the ills that come before us is that it ultimately becomes reduced to racial under and overtones and the real issues, whatever they may be, become lost and again ignored.
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8-15-2008 @ 9:00AM
peg said...
Poverty is increasingly color-blind in many urban areas. It would be naive to say that black neighborhoods do not suffer more significantly from urban problems such as drug use, gang warfare, unemployment and general urban decay. But certainly we ae seeing this in smaller cities among white communities too (especially in the Northeast where prescription drugs are now sold illegally and creating new addicts every day). I think one of the main problems we continue to face is a lack of hope, a lack of personal accountability and a general lack of civility.
I am also appalled at how people seem to have forgotten the generaI lessons about littering from the 1970s; people just toss their fast food or other trash on the ground without a thought and this adds up quickly and makes neighborhoods looks horrible. If one lives in a "bad" neighborhood it is tempting to give up and let it continue to degrade. But why? If people could take more personal pride in their neighborhoods, keep parks and other public areas clean, plant gardens, keep streets and yards free of litter, this could go a long way towards improving morale and increasing real estate values. The missing ingredient here is personal pride of place and person--if people care about themselves and their surroundings, they keep them clean and presentable. To see such beautiful old homes in Detroit being ruined by neglect is heartbreaking.
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8-15-2008 @ 9:03AM
Barbara said...
Tom and claire are simply two idiots!
Idiots like you ( Bush voters) have brought America to its knees!
Calling people liberals , socialists ...and in my case calling you idiots make no difference but create anger and frankly it is all BS....
Get out of your frame of minds and get educated!and understand that we are not the only in the world and we need to respect the world and it is how we will gain respect back..
Those obnoxious days of me ,me , me are over..
We ( white people) have created the black problem. and indeed they simply have followed . Between the two running candidates , if Obama gets it then he would be a great role model for Black Americans , a young wellspoken and successful black man.and the world would finally realizes that we are not as stupid as we have been ! ( hopefully)
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8-15-2008 @ 9:04AM
George said...
Interesting how we got from $1 houses to racism. Blacks/Whites do not have a monopoly on running down neighborhoods. This last (and biggest) attack on our homes and neighborhoods was lead by Wall Street,mortgage brokers, and banks. They have now successfully ripped the last asset from the common working "man".Personally I believe we must protect whats left of our freedom by becoming better educated so that the big money and our politicians do take everything away from us. The enemy is not black or white it is not getting a good education so that you can protect yourself from the educated that have no ethics.
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8-15-2008 @ 9:34AM
ken said...
RIGHT ON !!!!!!!!
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8-15-2008 @ 9:35AM
Celeste said...
Wouldn't it be nice if we could blame everything on the"BLACKS"? However, you can't. Every city has its drug infested neighborhoods and Detroit is certainly no different. However, what this article fails to note is that Detroit has some absolutely beautiful neighborhoods where people jog and walk their pets and enjoy their neighborhoods. The author of this article is clearly an idiot who doesn't know that the riots took place in 1968. Robocop was created in 1987. Before tearing down a city perhaps he should know the history and have his facts in order. Yes, right now there is a complete thug supposedly running the city and he needs to go NOW!! But, he is not guilty of causing all of the ills of Detroit. I would say the economy is a much greater factor. Now, to those who are clearly, CLEARLY racist and want to blame the blacks-get real. It is our government that has us in the situation we are in and it is predominately WHITE!! I can bring up the many companies that went under and put many people out of jobs, all ran by wealthy white men. These things all contribute to the failure of the OUR economy. We can go back and forth blaming the problems of society on any race we choose. But, it won't solve anything.
Wherever you find poor (mostly urban areas) you find crime. It doesn't matter what the race. It is a problem of desperation, lack of education, loss of inner city programs, and survival.
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8-15-2008 @ 9:35AM
Jacob said...
Tammiem, that is your opinion. I do not condone or agree with what he said, but the fact of the matter is (Since you used it for an analogy) you believe in racist ideals when you stated the white trash opinion of yours. Even saying that shows others it is in the back of your mind or you wouldn't have thought to have said it. I'm not racist and judge people on character and their actions. But I don't just jump on the "hold your racist comments" bandwagon. Racism is the far right of comments such as those posted here and I do believe none of them were racist. Fact of the matter is blacks are in a tight spot in this country competing with Mexicans for social status, work, ect. You don't see whites controlling enormous amounts of city streets for pimping, drugs ect. When you do, they are mixed in with the crowd. Fact is, if whites were in the situation as blacks, you WOULD see the same thing happening with whites. Its not a color issue but a social issue. What he said was partially true based on statistics but at the same time its false because it has nothing to do with color.
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8-15-2008 @ 9:43AM
Sonja said...
I am from the Detroit area and I must say I am not surprised by the comments you so called “Know It Alls” are making. Detroit is full of beautiful, intelligent, hard working African Americans, so you really need to wake up. There are so many young people here doing great things in this city that you wouldn’t even know about. I personally feel that you “others” are threaten by the rapid changes and impacts that African American have made, which rarely gets noticed and will continue to make going forward. In a nutshell, I say to you, “Wake Up” the world is changing you YOU are NOT. I am 26 years old, and please know that I am capable of doing and excelling at anything that I put my mind to.
Know what your comments and inner rooted evil hatred is no good for YOU. Open your mind and change your thoughts, it is the root of your demise.
An lay off the Mayor, there are others who have done much worst, that is not getting the attention a he is, for example the guy for NY.
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8-15-2008 @ 9:50AM
jan said...
It is not the color of your skin but rather the color of your heart.
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8-15-2008 @ 9:58AM
val said...
HEAR HEAR!!!!!!!!
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8-15-2008 @ 10:01AM
val said...
EXACTLY right..I agree 100%
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