$1 Will Buy You a Home in Detroit
By: Diane Tuman, Content Manager | August 14, 2008
Desperation has hit Detroit. According to the Detroit News, several homes and a parcel were listed for sale for $1 in Detroit. One piece — at 8111 Traverse St, Detroit, MI (photo above) is close to a sale. And no, this is not a family member passing along a long-time property to another relative or some other insider deal, this is the ugly truth of how eager a bank is to unload a foreclosed property.
Not only is the bank owner losing any potential value in this property, but it will cost the bank an additional $10,000, “to pay $2,500 in sales commission and another $1,000 bonus for closing the $1 sale; the bank also will pay $500 of the buyer’s closing costs. Throw in back taxes and a water bill, and unloading the house will cost the bank about $10,000.”
In Zillow’s just released Q2 Real Estate Market Report, Detroit continues to slide with a decline of 12.9% year-over-year in Q2. The 5-year annualized is not quite so bad with a 3.2% decline. Detroit’s current Zillow Home Value Index is $124,126. The last time Detroit’s index was at these levels was Q4 of 1999.
- Stumble it!
- Categories: Real Estate Oddities
Comments
10 Comments so far
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rob on August 14, 2008 11:04 am
The house in the article looks to be brown. You sure it is that Green one?
Andrew on August 14, 2008 11:14 am
the back story of this is that the bank wanted to sell the property to rid the liability and potential law suits. they would loose a lot more than 10K if they held onto it.
Diane Tuman on August 14, 2008 11:54 am
Rob: I thought the same thing, but I’m confident that is the house. Look at the photo in the Detroit News. It shows the same bright green color at the top of the house: http://www.detnews.com/apps/pbcs.dll/article?AID=/20080813/METRO/808130360/&imw=Y
On our site, however, you can spin the house around to see all angles: East, West, North and South.
rob on August 14, 2008 12:40 pm
It also shows a tree in the front yard flanking the house. And the google street view shows the trees.
Diane Tuman on August 14, 2008 1:09 pm
Rob: This is the home. I just got off the phone with Ron French of the Detroit News. He’s been to the house and just sent me photos of it. What happened is the “vultures swooped in” and tore the siding off. I’ll do a followup blog post to explain. (Thanks for the idea!)
The Remains of the $1 Detroit House | Zillow® Blog on August 14, 2008 2:08 pm
[…] doing a post about the home in Detroit that is listed for $1, there were some challenges that I had the wrong home. While I was 99% confident it IS the home, I […]
rob on August 14, 2008 2:51 pm
Great research. You win!
mr peepers on August 14, 2008 11:14 pm
most banks can do what’s called a Charge Off. They simply release their lien, and charge off the debt/write it off. Releasing their lien releases them from liability without having to spend any mpney. Why this lender fronted 10K makes no sense to me and I’ve been in the business over 15 years. They’re idiots.
Hitting the Links | Redfin Boston Sweet Digs on August 14, 2008 11:22 pm
[…] Homes for one dollar each. Not a bad deal if you want to live in Detroit. [Zillow Blog] […]
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[…] Posted in Real Estate, Real Estate Politics by -Rob on August 15th, 2008 In light of this atrocious story, it might be time to think about some new initiatives. (H/T: Zillow Blog) Not only is the bank […]