The city of Detroit has been in the news a lot lately, but for all the wrong reasons. The city government recently filed for chapter 9 bankruptcy, which early estimates indicate is the largest municipal bankruptcy in U.S. history. The debt totals between 18-20 billion dollars, far surpassing the previous largest bankruptcy which was declared by Alabama’s Jefferson County and totaled around 4 billion. Things have gotten so dire in the Motor City, government officials are appraising and considering selling off some of Detroit’s most treasured works of art. Reports are that Christies is set to appraise the 60,000 piece collection, which is entirely owned by the city of Detroit.
While Detroit scrambles for ways to begin to pay off billions of dollars of debt, an interesting statistic about the city’s real estate market has recently emerged. According to MLive.com, a Michigan news site, Realtor.com has named Detroit a “Top Turnaround” city for the housing market. This may seem surprising in the wake of the city’s bankruptcy trouble, but Realtor.com’s Detroit listings grew 37% in price since last year. In addition to rising prices, the percentage of unsold homes in the Detroit Metro have decreased by about 26%.
What’s noteworthy about these statistics is that this is not a phenomenon reported only by Realtor.com. According the the MLive article, many real estate sources have seen jumps in price when it comes to Detroit housing. More interesting still is that while these prices have risen quickly, Detroit still has some of the lowest home prices in the entire United States.
Perhaps the most astonishing stats mentioned in the article are the amount of abandoned buildings and their prices within Detroit. There are about 78,000 abandoned buildings with some being priced at only $500!
It remains to be seen if the housing recovery can continue in Detroit amidst the city’s financial troubles, but it seems clear that Detroit’s housing prices are a must-watch for anyone in the real estate business.