Investing in the Detroit housing market has been a source of contention for investors for a long time. When considering whether or not to add properties in the Motor City to your portfolio, keep these three current trends in mind. The city of Detroit is one of the most populous in the Midwest. It also serves as the county seat for Wayne County.
When it comes to residential in Detroit, home prices are exceptionally low. Detroit is the most affordable city. The rentals can generate extremely high returns on investment. Since the purchase price of a Detroit single-family home is significantly less, it presents a fantastic opportunity with significant returns and cash flow.
It is also the fastest-growing city in the metro for rent.
The Detroit housing market has seen a lot of fluctuations in the past few years. The city has been slowly but steadily recovering from the Great Recession, which hit the area particularly hard.
In this blog post, we will take a look at the current state of the Detroit housing market, based on the most recent data available. We will analyse key metrics such as home prices, days on the market, and buyer/seller competition to provide insights into what to expect in 2023.
Median Sale Price
Data by Redfin show that the median sale price for all home types in Detroit in January 2023 was $76K, up 1.1% compared to the previous year.
This modest increase is a positive sign for the city’s housing market, indicating that demand for homes is stable. Overall, Detroit’s housing market seems to be recovering but it is still far from pre-recession levels.
Buyer/Seller Competition
The Redfin Compete Score rates how competitive an area is on a scale of 0 to 100, where 100 is the most competitive. Based on this metric, Detroit’s housing market is somewhat competitive, with a score of 63. This means that while homes in Detroit receive 3 offers on average, some homes still get multiple offers, making the market somewhat competitive.
Detroit, MI Housing Market
The following housing market trends are based on single-family, condo, and townhome properties listed for sale on Realtor.com. Land, multi-unit, and other property types are excluded. Detroit, Michigan has had its fair share of ups and downs, but when it comes to the housing market, things are definitely looking up. According to the latest report, the median listing home price in Detroit was $79.5K in February 2023, up 6% year-over-year.
In addition, the median listing home price per square foot was $69.
While the median home price may seem low compared to other major cities in the United States, it’s important to remember that Detroit is still in the midst of a renaissance. With companies like Amazon and Google setting up shop in the city, and a growing tech industry, it’s no surprise that housing prices are on the rise.
Despite the increase in prices, Detroit has still considered a buyer’s market as the supply of homes is greater than the demand for homes. With 180 neighbourhoods in Detroit, there’s a wide range of options available for buyers.
While Detroit may be a buyer’s market, that doesn’t mean that sellers won’t be able to sell their homes for a fair price. With housing prices on the rise, sellers may be able to get more for their home than they would have a few years ago.
Location matters.
As with any housing market, location matters in Detroit. Those looking for a high-end home in a prestigious neighbourhood should expect to pay more, while those looking for an affordable option may need to look in less expensive neighbourhood’s.
The rental market is also on the rise. With the influx of new businesses and industries in Detroit, the rental market is also experiencing growth. This could be a great opportunity for investors looking to purchase rental properties.
Overall, the Detroit housing market is showing promising signs of growth. Whether you’re a buyer, seller, or investor, there are opportunities to be found in this city. With the right research and guidance, anyone can navigate the Detroit housing market successfully.
According to Neigborhoodscout, over the last decade, Detroit real estate has appreciated 89.70 percent, which equates to an average annual appreciation rate of 6.61 percent, placing Detroit in the top 30% of all cities for real estate appreciation.
In the last twelve months, Detroit’s appreciation rates have remained among the highest in the country, at 20.95 percent. Short-term real estate investors have found success in Detroit over the last twelve months. Detroit’s appreciation rates were 0.87 percent in the most recent quarter, equating to a 3.53 percent annual appreciation rate.
Detroit Real Estate Investment Overview
Detroit, Michigan is a city with a rich history, known for its role in the automobile industry and its contributions to music, art, and culture. In recent years, Detroit’s real estate market has been on the upswing, making it an attractive destination for real estate investors looking for long-term returns.
Investing in the Detroit rental market offers several advantages for long-term investors. One advantage is the potential for long-term appreciation in property values. As the city continues to grow and improve, property values are expected to increase, leading to a significant return on investment for those who invest in rental properties now.
Another advantage of investing in the Detroit rental market is the relatively low cost of entry compared to other markets. With lower prices for rental properties, investors can purchase properties at a lower cost, increasing their potential return on investment.
Additionally, the high demand for rental properties in Detroit offers the potential for a consistent stream of rental income. As more people move to the city and job opportunities continue to grow, the demand for rental properties is likely to increase, providing a steady source of income for investors.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.
If you are ready to invest in the Detroit housing market, or wish for a call and more information on the latest properties Global Investments can offer then please email us today at :
invest@globalinvestmentsincorporated.
