But it was a bargain!
As if the rise of China’s auto industry were not enough of a threat to Detroit, Chinese real estate investors are now buying up homes in Michigan’s largest city at bargain rates.
With more Chinese buyers looking for opportunities to purchase US assets, the depressed prices in America’s auto capital seem to be attracting bargain shoppers. CCTV interviewed a Chinese investor who compared purchasing Detroit real estate favorably to usual shopping experiences.
“Why would I want to buy a pair of shoes for $1,100 when I could get two houses for $1,000 and still have $100 left over,” the investor said to the reporter. “So what we did over the last three years, we began to just buy properties, hold on to them, rehab them and then bring back those people that had been displaced by foreclosure back in a rental situation.”
One Chinese real estate agency apparently attracted thousands of inquiries for would-be home buyers within two days of advertising an investors tour of Detroit, reported the People’s Daily. Â The same article noted some homes going for as little as US$100.
However, many investors are also wary of the repair costs, inspection fees, taxes and other liabilities that may come along with these bargain homes.
Financially troubled Detroit has a high crime rate, is suffering from ongoing loss of population to more prosperous areas, and widespread unemployment. The city is now awaiting the appointment of a financial manager appointed by the state to take over its finances after the city’s financial functions were taken over by the state of Michigan earlier this month.
[…] “Why would I want to buy a pair of shoes for $1,100 when I could get two houses for $1,000 and still have $100 left over."Source: Un-named Chinese investor […]