A HOUSE FOR $500

The author, Drew Philp's home.
photograph by Mike Williams
Today’s post is adapted from a conversation I had with a brilliant friend (code name “Moriarty”). He sent this great rebuilding article about a young man who bought an abandoned house in Detroit for $500 and then proceeded to fix it up.

Moriarty talked about doing this four or five years ago when everyone was agape at Detroit's deterioration. He wonders now if he missed out on a great opportunity. “I could've had the pick of any one of many beautiful, neglected homes, most of them under $10,000. Now, I'd just be another carpetbagger.”

When we discussed the Detroit option years ago, it was obvious the prices would go up after some unidentified period of time.  But that few people would want to live there then (or even now).
If you purchased property and did not live there, you are still exposed to property taxes and liabilities if left unused.  Even a sure thing is a gamble in some ways.

The fixer-upper I almost bought for a song.
It's at the edge of a neighborhood that's improved a LOT
in the last 11 years: I just didn't want to wait that long.

Why Not?


The pillaged colosseum in Rome.
Image courtesy of KatiePanda via Flickr.
What's different about the kid in the article is that he had the courage to live there.  My first home was almost a lovely Victorian townhouse fixer upper just Northwest of downtown Salt Lake City.  But as a single woman, I was too nervous to live there alone: the sidewalks didn’t look safe.  Someone else has taken it and done what I had hoped and has quite a beautiful property on their hands.  Sometimes I wonder if it would have been okay and I wouldn’t have the crazy mortgage I have now.  But what makes me love my home is the neighborhood.  My kids walk to school, we have parks and neighborhood groceries and great neighbors that have been here for generations.


I loved the part in the article about Paul Weertz. The communities building up now are idyllic in many ways.
The salvage opportunities sounds wonderful and incredibly sad at the same time.  Makes me think of the ruins in Rome that were pillaged for materials in the early middle ages.

The Decline and Revival of Detroit


Moriarty continues, “this story and the decline (and revival) of Detroit raise so many issues and questions:


  1. Detroit is a case study of the decline of manufacturing in the U.S.
  2. Detroit is a case study of the deleterious effects of state-enforced labor unionization.
  3. Detroit is a case study of young, upper-SES whites gentrifying a minority-owned urban area and the complications and tensions that that can cause.
  4. Detroit has a new mayor, and he seems likely to really improve things, at least things in City Hall. The index of residential prices in the city has not only stabilized in the past 12-18 months, it is on the rise.
  5. Detroit now offers young people the opportunity at home ownership and participating in a community of involved citizens. Is there anywhere else in the US where a recent college graduate can own a home (or many homes) and a small piece of land outright?
  6. Detroit is anarchic, but many of the citizens seem intent on filling in the gaps that the city cannot.


“I'm very hopeful for a revival of the city. Of course, much of it will have to be razed, and the few citizens who refuse to live there peacefully will have to leave before families and businesses will re-invest in the city.

“I think there are serious business possibilities for salvaging and recycling, if someone has the heart to tear down a building for its brick, wood, stone, and metal. If it's just going to burn, rot, or be destroyed otherwise, I think salvaging and recycling are the best things that can be done.”

What do you think?  


Is super cheap real estate an opportunity or a building plague for residents that you wouldn't risk?

Consider: most Americans who own a home spend the majority of their prime earning years paying off a mortgage so that they can have a place to retire in peace.  If you could pay off your home/land in one pay period, what then?

-ally


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