Consider for a moment that there are lots and lots of properties in Detroit with an advertised price of less than $10K. How many people in the USA have the financial resources to speculate with that kind of money? Millions? Tens of millions? And yet ... they don't. There is probably a reason nobody else is snapping up these properties.
I actually know someone who bought a house for 6K. He did not buy it from the land bank so he might be able to sit on it, theoretically, and hope it gains some value. But do your due diligence because there may be big taxes, unpaid utility bills, etc, encumbering the property.
>there may be big taxes, unpaid utility bills, etc, encumbering the property
The reason no one buys is actually a lot simpler than that, if you buy, you have to bring the place up to code. Further, the city watches like a hawk to make sure no one games the system or takes advantage of the poor people living there. So in short, the real price is nowhere even close to the USD1000 that you heard about on the news.
These guys got some exemptions from rules because: "agriculture". Most people would not be getting that exemption. It's just too much work and you could never change and say, "Oh, I want to build a building there now!"
It's one thing to renovate one home in squatter and abandoned zones for yourself. Another thing entirely to bank on entire subdivisions of people wanting to move into such an area. Who's going to buy the home you build next to the squatters?
And keep in mind, if no one buys and moves in, you're still liable for upkeep on each and every one of the lots. For as long as it takes to sell. Which may never actually happen.
There are plenty of billionaires in Detroit who have tried to buy up large swaths of land and have been rejected by the city. The city government has made it clear that they do not want speculation, they want taxpayers.
No, the people being talked about go out of their way not to pay taxes. They will pressure the local government to rezone the properties to get away with not paying taxes. Billionaires paying taxes. Lol.
Property taxes on vacant land tend to be much lower than occupied dwellings. The city needs to either unincorporate the land and release it to the county, or find a way to get people living there again to pay for the city services that require upkeep.
Correct. But downtown is a small part of Detroit, and those properties were given huge tax incentives so they generate very little income for the city.
Mike Ilitch and Dan Gilbert have done amazing things in a 5 square block section of downtown, but it does little to help the population of Detroit. These taxpayer-funded giveaways to local billionaires has not exactly played out as planned.
I actually know someone who bought a house for 6K. He did not buy it from the land bank so he might be able to sit on it, theoretically, and hope it gains some value. But do your due diligence because there may be big taxes, unpaid utility bills, etc, encumbering the property.