Cheapest Homes in Michigan
Whether you are an investor or a prospective homeowner, finding the cheapest homes in Michigan will save you money. For landlords, buying cheap houses to fix up and rent out can be an extremely profitable endeavor and will usually earn a greater return on investment than buying and renting out more expensive properties.
Why Cheap Michigan Houses Are More Profitable
When making an investment, landlords need to consider the return on investment to determine which property will be more profitable. It is possible for an investor to buy a house for $5000, put $10,000 into it and rent it out for $300 per month. Assuming that the house is still worth $15,000 one year later, the investor has earned a 24% ROI in the first year. If the investor had paid $100,000 for the house, he would need to get $2000 per month in rent to earn the same rate of return.
It is unrealistic to expect to find someone who is willing to pay $2000 per month to rent a $100,000 house, but it is not difficult at all to rent a $15,000 house for $300. With the shortage of affordable housing in this country, no matter where you live, if you are able to rent a decent home for $300 per month, you will have it rented almost as soon as you put up the "For Rent" sign.
Where to Find the Cheapest Homes in Michigan
Although there are cheap homes in many areas, the most obvious place to look is in urban areas. You will always be able to find cheap homes in large cities such as Detroit, Flint, Saginaw and Grand Rapids. However, you should be aware of the problems that resulted in these homes being so cheap. Not every cheap house is a good investment.
In many of these areas, especially in Detroit, you will find houses that are in terrible neighborhoods. The easiest way to tell if you are in a bad neighborhood is to see if there are burnt-out houses in the same block as the house you are thinking about buying. If so, it may be difficult to fix the house and rent it out because of the vandalism in the neighborhood. How many times are you prepared to replace the pipes because someone stripped them out during the night to sell for drug money? The right deal in the wrong neighborhood can turn into an endless money pit.
Where to Find Foreclosure Homes in Michigan
Michigan
has seen a lot of foreclosures in the past few years. These homes are
located all over the state, not just in highly populated urban areas. You
can find foreclosures in your own area by paying attention to the legal
notices in the newspaper. You can also locate foreclosures through
foreclosure websites and the HUD website. Foreclosures sold through HUD are
usually offered as owner/occupant homes first and then the bidding is opened
to investors if no one else places a high enough bid.
Not all foreclosures qualify as cheap homes, but many of them do. You will find foreclosure properties in all price ranges. Be sure to inspect these homes carefully before buying because they are almost always sold "as-is." Banks are not well-known for taking good care of the real estate they own, so be sure to check the plumbing and look for water damage that may have been caused by the failure to winterize the home before the first good freeze.
Finding Cheap Homes in Detroit, Michigan
If the idea of buying a house for $2000 appeals to you and you are not afraid to invest in a bad neighborhood, you can purchase a house through the City of Detroit's property sales. Every month, the city sells properties that have been taken back by the city because of unpaid property taxes and/or water and sewage bills. The list of properties is released to the public near the beginning of each month and bidders usually have 2-3 weeks to submit bids and proposals. You can get more information from the City of Detroit's Planning & Development Department.
Finding Tax Foreclosed Properties in Michigan
Most counties in Michigan have a tax sale once per year to auction off properties that have been foreclosed due to failure to pay property taxes. Each county sets its own dates and procedures for the sale of these properties, so the best way to find out how to purchase them is to contact the tax assessor's office in the county where you would like to buy real estate and ask them when their tax sale is.
Finding HUD Homes in Michigan
The company that handles listings for HUD houses in Michigan is Michaelson, Connor & Boul. On the Michigan page of their website at http://www.mcbreo.com/st_mimain.htm, you can search for property in a specific city or zip code. You can also click to view all of the properties that are available in a specific city or county.
Examples of the Cheapest Homes in Michigan
In order to give you an idea of the possibilities, here are examples of some of the cheapest homes in Michigan. Some of these are HUD houses and others are foreclosures. Please note that these are some of the cheapest homes in Michigan at the time of this writing; the availability of real estate for sale changes constantly.
14885 Fielding St., Detroit, MI 48223
This small 2-bedroom house has been stripped. The furnace, hot water heater, kitchen cabinets and plumbing have all been torn out, as well as other things. The home is also in need of mold remediation. This is a HUD house with a starting bid of $2,000.
12916 Hayes St., Detroit, MI 48205
This small 2-bedroom brick house is estimated to have about 25 years of life left in it. However, the plumbing and electrical systems are in need of repair and it is unknown whether the furnace is operational. The windows need to be replaced. This is a HUD house with a starting bid of $2,000.
309 W. Flint Park Blvd., Flint, MI 48505
This 3-bedroom, 1-bath house is 911 square feet and requires mold remediation. It needs a new plumbing system, kitchen and bathroom fixtures, furnace and wiring. The foundation needs to be excavated, stabilized and sealed. This is a HUD house with a starting bid of $2,000.
19127 Derby St., Detroit, MI 48203
This six bedroom, 2-bath house has been divided into two units with 2844 total square feet. The kitchen and bathroom fixtures have been stripped from both units. The heating systems, water heaters and windows all need to be replaced. It also needs new water lines and electrical power lines. This is a HUD house with a starting bid of $2,200.
111 Cedarhurst Pl., Highland Park, MI 48203
This 3-bedroom, 1-bath house is 1290 square feet. The plumbing and heating systems do not work and the porch needs to be repaired or replaced. The windows, walls and ceilings are in need of repair and the bathroom sink is missing. This is a HUD house with a starting bid of $2,700.
15412 Faircrest St., Detroit, MI 48205
This cute gray and white house has a cracked foundation. The front steps and porch need to be repaired or replaced, as do the furnace and the bathroom sink, faucet and vanity. There is evidence of mold. This is a 3-bedroom, 1-bath house with 1106 square feet. It is a HUD house with a starting bid of $3,200.
14814 Houston Whittier St., Detroit, MI 48205
This small 3-bedroom, 1-bath house is 936 square feet and appears to have both mold and water damage. It also has cracked foundation and there are problems with the roof, water heater, plumbing, electrical system, furnace, bathroom fixtures and windows. This is a HUD house with a starting bid of $3,200.
15714 Coram St., Detroit, MI 48205
This 3-bedroom, 1-bath house is 1091 square feet and needs a new roof, windows and water heater. It is also in need of mold remediation. It is a HUD house with a starting bid of $4,000.
4201 Springle St., Detroit, MI 48215
This is a 3-bedroom, 1-bath house is 1040 square feet and has a partial brick front. It requires new floor coverings, windows and doors, kitchen, water heater, heating system and more. There is also a mold-like substance present. This is a HUD house with a starting bid of $4,000.
14501 Lappin St., Detroit, MI 48205
This large 4-bedroom, 2-bath house has 1730 square feet and is divided into two rental units. It needs new doors, windows, drywall, sinks, tubs, toilets and water heaters. The garage is missing siding and the plumbing and electrical systems are not working. This is a HUD house with a starting bid of $4,000.
639-641 Blaine St., Detroit, MI 48202
This 3920-square-foot house has been divided into three units. There are a total of 6 bedrooms and 4 baths. It needs a new roof. The plumbing and electrical systems do not work in any of the units and the plumbing fixtures, water heaters, windows, doors and downspouts needs to be replaced. Some of the floors are in need of repair and there is mold present in the basement. This is a HUD house with a starting bid of $4,000.
363 Nelson St., Pontiac, MI 48342
This 3-bedroom, 1-bath brick house is 893 square feet and needs new windows and a blower fan for the furnace. There is a mold-like substance present. This is a HUD house with a starting bid of $4,000..