You won’t be able to move in right away, but you can invest in a 500 dollar home. Watch its market value rise up, and soon enough you’ll have property which can cost up to 30,000 dollars. That’s a great deal of value, which makes for a great option for commercial purposes or for use as a rental space somewhere down the line.
You’ve heard stories about how Detroit, Michigan is the perfect place for some real estate ventures, whether commercial or residential. Yet, if you’re thinking about moving in, you’d be surprised at the really good deals you’ve got waiting for you. Nicole Curtis, host of Rehab Addict on HGTV, and Detroit Land Bank Authority Director of Public Affairs Craig Fable share a few tidbits of valuable information on purchasing houses that are available for auction.
They don’t actually cost 500 dollars.
It’s only because they are in shambles that they’ve been given such titles. Truth be told, you’d have to invest some money into it, perhaps right around the 10,000 dollar range just for repairs, in order to make it viable as living space. The worst case scenario is you spending way more for that, including utilities, furniture, water bills and many other factors that go into making it livable.
Buying a house auctioned by the DBLA gives you 6 months to occupy it!
Of course, for homes which have some historical value, 9 months is the maximum time allowed. If you don’t take care of the regulatory requirements, you’ll end up losing the home, thus throwing away all your initial expenses for it. Hence, it is necessary to have a budget prepared beforehand for the repairs to be done.
Time (that means money) is needed.
You’ll have to be patient with the rehabilitation of an auctioned home. You can either do the fixing yourself, or hire services. So long as you have the skill set required, as well as the imagination, you can ensure that the house will end up looking just how you envisioned it. If you’re not sure of your home renovation skills, there are professionals who can do it for you. Just know that nothing is instantaneous.
Vacant homes don’t always mean you can move in immediately.
Considering that a lot of the homes which had been foreclosed are in bad shape, this makes them less than desirable living spaces. You will find doors missing, windows broken, many utilities being non-functional and the like. You’d have to spend some money first for necessary repairs and hiring services to address those concerns.
Some homes automatically go into auction. (MAJOR LOOPHOLE!)
On the first auction, the cost of the home is attributed to the amount owed. However, if they don’t sell, a second auction is held, wherein the house is sold for 500 dollars. If that doesn’t work out, they’re then given away to Detroit Land Bank Authority, where the starting price would be $1,000.
Homes that are in bad shape often contain hidden gems, such as…
A lot of the homes available for auction often have rather special features about them which make it all too good to pass up and just tear down immediately. Sure, the plumbing may not be up to par, but if you’ve got a rather swanky fireplace that only needs a few touch ups, that’s reason enough to get everything else fixed. The details will stand out even more if that’s the case.
There is a very small chance for quick turnarounds.
The fact is that you can’t expect the property to be made livable in a short span of time. If you are new to purchasing auctioned homes, expect a whole lot of time spent in renovating it before it actually becomes livable. There needs to be real follow-through, and that means taking anywhere from several months to even up to two years.
There’s a chance you can purchase an auctioned home by accident.
You may not really know all the details of the house you’ve purchased, especially when done online. You’ll only find out about it once you’ve actually visited the place. Hence, it is wise to be prepared before making any decisions. Otherwise, you’d have to be the owner of a really heavy bank account to get the home rectified and livable.
The houses being auctioned have historical significance.
It certainly isn’t strange to discover that a house you’ve purchased was once owned by the rich and elite of Detroit’s early society. Hence, you’d actually be renovating something that was quite prominent during its hey day. If you’ve got the time and the money to invest in foreclosed homes, you just might end up being the new king and queen of the castle in a rather lavish part of town.
Renovating isn’t exactly a safe DIY concept.
When there’s just too much work to be done in the home, you can’t expect to take care of everything yourself. The materials may be too flimsy and you’d end up getting injured, especially if you have neither the proper skill set nor the tools. At times, it’s best to get the pros to do it for you instead.
You can find various agencies hosting auctions for 500 dollar houses.
If you’re looking for a fresh start, there’s no other way to do so than to look up auctions hosted by the Detroit Land Bank Auction or the Wayne County Tax Auction. The latter has already sold around 24,000 properties over the Internet at a minimum bid of 500 dollars. DLBA, on the other hand, go for 1,000 dollar bids on top of closing costs and property tax.
There may still be someone living in the property you purchased
In such cases, you can either kick the occupant out or be the landlord and expect payment for them living in the space you purchased. There are still about 20,000 homes out of a total of 60,000 which had been faced with foreclosure yet still have occupants. If you purchase a home, the outcome is entirely dependent on you.
Check the place out first before making hasty purchasing decisions.
The DBLA will do everything within its power to provide updated information on auctioned houses. However, they’ve got so many other homes to visit, and you can’t expect them to cover all of a single home. Hence, it would be wise to just check the place out yourself so you know what you’re getting yourself into before deciding to buy it.
Absentee investors or landlords are off-limits.
Remote investors are highly frowned upon and discouraged by the DBLA. Properties cannot be purchased in bulk too. The investors should actually see to the renovation of these homes first and making them entirely livable before they are allowed to purchase another piece of property. Occupancy is also a must before more purchases can be made.
