Recovery is well underway in Detroit, where the real estate market provides steadily growing, attractive investment opportunities.
I’m thinking of a city with the busiest international border crossing in North America. Where downtown apartment vacancy rates are below 5 percent and continuously dropping. A city neighbored by suburbs with some of the safest rated living standards in the United States, where entry home prices are in the ballpark of $50,000. Have you figured it out yet? Over 100 Fortune 500 companies have offices with close proximity to the city square.
What if I told you that this Metropolis was home to the world headquarters of major national companies— Ford Motor, General Motors, Quicken Loans? Welcome to Detroit!
News stories from the past few years showcased Detroit with headlines ranging from a broken municipality struggling through bankruptcy court, to record-setting growths in residential occupancy rates.
In reality, the past five years in Detroit have presented skyrocketing home values, a redevelopment of the urban landscape and billions of dollars pumped into the residential and commercial real estate market. What has significantly caught the attention of many individuals in the world is the success that investment groups and real estate companies have had in the Detroit turnkey rental home market.
When it comes to investing in American real estate, the Detroit market provides steadily growing, attractive investment opportunities. With names like Dan Gilbert and Mike Illitch pouring billions of dollars into Detroit’s high-rise business and residential districts, thousands of new residents have relocated to the city for employment. With employment comes residence, and that’s where small-time investors are profiting. New residents are looking for safe, reliable homes close to the city.
Detroit is located in Wayne County, which has been recognized by RealtyTrac as one of the highest grossing rental markets for landlords in the U.S. What really sets Wayne County apart is the initial investment required to get a rental property performing. Using median home prices as a major contributor, RealtyTrac compares Detroit with other major rental markets in the nation. Although the numbers may be skewed due to extreme highs and lows, the overall picture is still the same—Detroit tops the list.
Apartment vacancy rates in Downtown Detroit are currently under 5 percent and falling with every new report. Residential areas are also seeing occupancy growth, as investment companies are renovating dilapidated clusters of once-abandoned homes into family-friendly communities.
Many more things help to keep the Detroit rental market strong: government subsidies for tenants, ample job opportunities due to the automotive industry’s rebound, and arguably one of the biggest factors—the people of Detroit are known as a resilient crowd.
The city is on a comeback from the largest municipal bankruptcy filing in the United States, and everyone in the region is benefiting. Job stability is strong, helping more residents secure income. Great news for landlords, as individuals on the come-up are finding low rental rates much more attractive than high-interest mortgage payments.
The Detroit real estate market is diverse, so it is imperative that proper research and planning is completed before beginning a venture into the market. There are many great neighborhoods with bright futures, and the daily blight removal by city services is helping to increase home values on a consistent basis.
The flag of Detroit, designed in 1907, displays the motto “Resurget Cineribus,” which translates to “It will rise from the ashes.” True to its history, Detroit is a city that rebuilds—and comes back stronger than ever.