I listened to your interview with Aaron Task today. While I can agree with your thesis, I did not care for the Love Canal-Detroit comment. Houses in the city of Detroit rarely go to $0 and certainly have some value to someone. This unfunny remark can probably be best summed up as racist or ignorant. I will assume the former.  

-Nick

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Actually, its neither.

People have tried to take me to task whenever I differentiate between stocks and houses. The half joking quote is "The difference between stocks and houses is, outside of Love Canal & Detroit, houses don’t go to zero."

I’m sorry Nick, but unfortunately, this is not a joke: I first mentioned this back in February, when realtor.com had a huge run of houses for sale in the Detroit area for $100.

Today?

There are 182 Properties for sales for less than $1,000 on Realtor.com/search — and the asking price on some of those houses is one dollar:

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Detriot_1


Thanks for the suggestion Nick — I never would have thought of updating this if it wasn’t for you!

Category: Economy, Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

32 Responses to “Detroit Houses = $1”

  1. Scott Frew says:

    I’ve been skeptical about all the bottom callers in the stock market, and what that portends for stock prices. In this case, though, I’m willing to go out on a limb and state that I think, at the very least, a bottom is forming in Detroit residential prices. Although we could stay at these levels for a while, I do not see prices going much lower from here. Of course, if you buy at the ask, you could still lose one hundred percent of your investment.

  2. Jeff says:

    Isn’t the $1 list price usually indicative of some sort of an auction about to take place?

  3. johnnyvee says:

    Don’t forget that there could be tax liens on the property too or penalties because the place is in violation of new anti-foreclosusre ugly house laws. So, one could buy it and then owe more. These houses are less than zero. There are times when the city bulldozers the house because its such a nuisance. No shit. Its happened to a few lenders.

  4. nades says:

    I love the default to racism… Maybe Nick has some issues of his own cause that’s a pretty shitty null hypothesis…

    ……………….

  5. Scott Frew says:

    I can come up with the scratch for a 10% down payment. Anybody got a mortgage calculator? What’s the monthly nut on a 30 year fixed? Do I qualify for the $7500 tax credit in the new housiing/economic recovery act?

  6. OCDEVIL says:

    Nick:

    Grow a nutsack and take a joke for what its worth. I’m sure that you didn’t put up this much of a fuss when your used house salesman told you that housing never goes down.

  7. Franz says:

    The $1 house menu, courtesy of Chef Bernanke (hat tip to Lew Rockwell blog):

    Foreclosure Fallout: Houses go for a $1

  8. Jim D says:

    And the winner of the “ignorant racist” contest is… Nick.

    Nice going, Nick! Well done, please play again!

    Then again, maybe I’m being to hard on Nick – after all, $1 *isn’t* the same as $0, and that was his contention… Or perhaps he thinks that almost 200 currently listed properties is “rare”?

    Sure hope he comes on here and lets us know.

    Or, you know, apologizes. Publicly. With shame in his voice.

    That’d be nice, too.

  9. Jeff says:

    Any chance I can get an interest-only option ARM on one of these properties?

  10. alan says:

    The house on Tuller is actually $2500. Seller will not bring any money to close. Buyer must bring $2500 to close transaction.

    The $1 price is a bit misleading.

  11. E says:

    I think Nick is likely a child molester. Maybe a serial killer. Like Nick, I don’t need any actual evidence to make these accusations.

  12. Alex says:

    Many homes in Detroit were clearly worth less than $1.00, as evidenced by their long term vacancy, and subsequent torching on Devil’s night. While this has declined in recent years, I have it on good authority that “house burning parties” are still held from time to time.

    There are whole sections of the city that have been devoid of residents for so many years, the wild-life is coming back. See this post on the “Detroit Pheasants”:
    http://www.nodakoutdoors.com/forums/viewtopic.php?t=44710

    Police protection for a large swath of residential areas is non-existent. Police figure if you are stupid enough to buy in certain areas, you get what you deserve. The schools? Please.

    The price of a house is appropriately zero if the area is uninhabitable. That is…if you aren’t a pheasant!

    Only the most bigoted would think that these acute urban problems are solvable by attacking those that point out such abysmal real estate prices and living conditions.

    A progressive person would have something positive to say in response to such claims, or would be able to point to some positive actions being taken to change things.

    I will assume that Nick is the former.

  13. Eric Sebille says:

    So if I have 3.5 cents I can get a FNM backed conforming mortgage on one of these beauties?

  14. joebek says:

    $1 Houses! Ted Turner and nouveau uber millionare Al Gore should be buying up the property in Michigan so that it can be returned to wilderness.

  15. Innocent Bystander says:

    Nick is enlightened, and probably washes his Prius every night. After all, if his neighbors would just listen to him, the world would be a better place. Color him clueless.

  16. Jon H says:

    Hm. I wonder if there are any complete city blocks full of $1 houses, that could be bought up, knocked down, and the land used to build a (well-secured!) estate…

    Not good if you’re planning to have kids, I guess, but ideal for the budding Batman looking for a place to build stately Wayne Manor.

  17. Detroit Dan says:

    Detroit’s not a bad place. We’ve got a beautiful downtown.

    And the housing is affordable (-; Our mayor is in trouble, mainly for lying about sexual indiscretions. But the system is reacting properly and nobody is defending the mayor, so he will be on his way out soon. Our country should be so fortunate…

  18. VoiceFromTheWilderness says:

    Wow, what a charitable guy…’I’ll assume the former’.

    Gee, bud, get much mileage by slinging around the ‘racist’ slur?

    Sure yeah, commentary on house prices that isn’t supportive of one’s view point automatically = racism. Sure, I get that, sure… as Jon Stewart says… go on…

  19. Barley says:

    I’ll buy a house in DEtroit – if they pay me; say now taxes, no fees, no assessments. Otherwise the risks for such a relo are far too high.

    Rust belt be-gone.

    Seriously tho, I think the US majors have done a dis-service to DEtroit and the US. Not enough forward thinking and Mgmt. too damn arrogant to see the forest for the trees. And, Unions who have a sense of entitlement for a simple paycheck.

    Note to self, reduce the MBA hiring of Minie-Mees and explore more creative talent to get the job done and send as broadcast email announcing the formation of a Union and anyone can join and get a higher wage but forgo all future bonuses.

  20. Ironman says:

    Hats off, Barry! Speaking from personal experience, I have to say that there’s nothing quite like seeing the skillful and effective public presentation of objective, real-life data fly directly in the face of a race-baiting twit that fully refutes whatever clueless observation or assertion they may have made.

    Some days, blogging’s just a lot more fun than others….

  21. Nunca says:

    I’m willing to bet large that Nick is a Lib or a college professor, but I repeat myself.

  22. brion says:

    It’s a short step from a one dollar house to “we’ll pay YOU to live amongst the shittiest of shitheads this shitty planet can provide”

    …A close second is “we’ll pay you a million dollars, but first you must spend the night in this creepy haunted mansion….unless you’re prejudiced against ghosts”

  23. simon says:

    If I ever come to America I’m going to visit Detroit to see these houses. They are some how so symbolic. They are so sad. Many were grand houses in presumably leafy suburbs.

    They are almost like organic Inca ruins. I hope they don’t portend a similar fate for us.

  24. Wille says:

    Anyone thought of buying these houses for $1, then stripping what ever can be stripped and selling it of on eBay? (I’m thinking sinks, pipes, any whiteware left etc).

    Take a leaf from the 80′s corporate raiders playbook – cut it up and sell it in pieces.

  25. John says:

    To some people everything has a racial connotation, Nick is clearly one of them. Most of them are totally humorless alas. The more serious downside of this sort of over reactive idiocy is that it provides fodder for those interested in promoting racially divisive politics to poke fun at what are often substantive issues of discrimination and disadvantage. Grow up Nick you sounded like jerk.

  26. Nick says:

    Okay, I’ll start with a huge apology to Barry. I’ve been a fan of this blog and his public work for some time. I’m sorry.
    Comparing Detroit, all of Detroit, to the most notorious toxic contamination event in US history is unfair. These homes are located in blighted areas of the city of Detroit. And as mentioned by previous posters, these places are not in move in condition. To the poster that suggested stripping these homes and selling the parts on ebay: It has already been done for decades. These are not homes. They are shells. Leaky shells. Stripping these places has made them near worthless. It’s scumbag “business ventures” that have helped decimate these neighborhoods in the first place. And tax liens matter. You will have a bill to pay at closing. There is no $0 house.
    And Detroit had this problem well before the advent of the subprime mortgage. Before easy financing, land contracts and FHA were the primary vehicles for selling homes. And these places have foundered along side the subprime financed homes. This is a city that once had nearly 2 million souls that today has 800,000. Want to know what happened? The white people left. Then many, many of the successful black people left. Detroit, the region, is a very prosperous place despite the national atttention it receives to the contrary. But the city is largely a ghetto. It’s schools are terrible. The property tax rates are very high (to compensate for lost population through the decades.) And services are infrequent to nonexistent.
    The upshot of all this is that I believe Detroit is a poor example to use in the housing debate. The suburb experience is far more instructive. In this town, shots taken at Detroit all too often have a racial message to deliver. For that I am sorry to have included Barry. But for everyone, remember this, pot shots at Detroit are cheap in any event. Go make a positive change in your own blighted, urban area before hurling insults at ours.

  27. Mo says:

    I’m sure that I’m just missing the link, but the Detroit News tackled this topic yesterday in an article titled “Foreclosure fallout: Houses go for $1″ and it’s the most popular article on their website this morning:

    http://www.detnews.com/apps/pbcs.dll/article?AID=/20080813/METRO/808130360/&imw=Y

  28. Smokefoot says:

    Nick said: “The upshot of all this is that I believe Detroit is a poor example to use in the housing debate.”

    Barry actually used Detroit as a exception: “outside of Love Canal & Detroit, houses don’t go to zero”.

  29. Short Man says:

    Wille said “Anyone thought of buying these houses for $1, then stripping what ever can be stripped and selling it of on eBay? (I’m thinking sinks, pipes, any whiteware left etc).

    Take a leaf from the 80′s corporate raiders playbook – cut it up and sell it in pieces.”

    - – - – - – - -

    Most likely anything of value was already stripped out but you wouldn’t find out until after you closed on the deal. Unlikely you’d ever recover the closing costs. Even if you did, you are the new owner on title and are responsible for property taxes/maintenance until you can unload it to someone else. Would cost a couple thousand just to demolish the place.

  30. Anonymouse says:

    Hey Nick,

    Way to man-up and apologize. Good for you.

  31. thefinancedude says:

    Did anyone else notice the first two homes listed were the same home?

  32. Detroit, Man says:

    Detroit was the original housing bubble (in the early teens and twenties it expanded like no other city in the country). Now all those big brick McMansions of their day are falling apart, and no one wants to live in them because they are too expensive to maintain; the only people who live in them are the ones who can’t afford anything else.
    The so called “decline” of Detroit is nothing but the evacution of the remnants of an unprecedented industrial expansion and middle class prosperity. Detroit is a giant museum of a by-gone age, but it’s condition has nothing to do with the decline of the auto industry as much as it’s success – everyone who could afford it moved to the suburbs with their big yards and cozy ranch style homes.
    Almost every abandoned house and storefront in Detroit is a remnant of those boom times. There are factories still standing that used to produce horse carriages. If you can see beyond the decay it can be a fascinating drive seeing these old buildings that formed concentric rings around the city decade by decade. It will take a massive demolition project to eventually clean out the leftovers of that age. Unfortunately, they will probably throw out the good with the bad when they do.