My 2.4M Detroit Portfolio (Update)
Man it's been a while...
Fun fact: I had a call with bigger pockets to be considered for a future episode on their podcast. Be totally cool if that happens and hope I can share more details on everything I've done since 2022.
My last update -- I think we were at 1.5M and 22 properties?
Today, I have 27 properties. All 100% financed with total appraised values coming in at $2.4M.
It's been a while since my last update. I've honestly just had so many insane real-life business things going on - Been traveling Central Asia for work and doing international business deals.
Real Estate was always designed to be passive for me -- And that's exactly what it's been the past year. I thought I'd have 40 doors by now and that obviously isn't the case.
Let me explain.
For 2025, we're in august now... I haven't picked up a single door.
Most of my portfolio...I purchased homes for around $40-60k. After repair values were $100k or better.
Interest rates haven't come down and Detroit real estate exploded...The same streets where I have properties, a fixer upper sells for $75k. A nice property is going for $110k-$130k+
When financing these deals at the current 6-8% interest rates, things just aren't attractive anymore.
The good news -- I've found truly the best PM in all of Detroit. While we haven't been successful acquiring new properties together this year, the management, leasing renewals, section 8 management, and the stabilization of my portfolio is 100% credited and owed to the amazing group I've been working with.
That could change tomorrow -- so I won't put their name here. But if you DM me -- I'll happily share their contacts with you -- you can tell them I sent ya and they'll help you buy with confidence in Detroit and manage your units with integrity. They are the reason I was able to scale so quickly from 10 to 27 doors. Together, in a group text chat, we conquered blocks of Detroit. From evaluating, to inspecting, walking the units, etc. This group was with me every step of the way and made me feel confident in my decision buying so aggressively. They also helped me secure deals that returned nearly 80% appreciation gains. Long story short -- We had an incredible run.
Today, we're cash flowing. My properties have appreciated through the roof. Everything is mortgaged. I spent $1,822,957.61 buying 27 doors over the last 36 months.
That's an average of $67,516.94 per property.
I just completed mortgaging the entire portfolio. The appraised portfolio value came in at: $2,407,000
The cash in the deal is just around ~500,000.
There's around $600k+ in equity right now sitting in the portfolio.
I completed the re-fi back in febuary or march. I just recently ran the address's through Zillow -- and the estimates there are showing the portfolio value at $2,739,300 -- I take with this a grain of salt, but the reality of Detroit real estate right now is likely true.
My take aways of holding real estate for the last 36 months -- not relying on the cash flow, and my experience buying in Detroit...
1. I wish I bought a hell of a lot more the last 24 months.
Some of my deals I purchased for $56k, the appraisals came back at $122k!
Where can you find a market return like that?
2. I'm kind of just sitting now. We just increased rents across the board at 10%. And I stepped up anyone who was under $1,000 to step up to $1,000. Pleasantly surprised, everyone was fine with these increases and signed their new leases.
Today, 11 of my properties are Section 8 and the other 16 are cash paying tenants.
This update is not as exciting as my others. I've now just been in a holding position. I have 27 properties. My appreciation is still rising, minimum 9% year over year right now -- And the city of Detroit continues to amaze. The billions of economic development happening in that city and the incredible work that Mayor Mike Duggan has done -- He's brought Detroit back to life. I'm fortunate to get in before the median home price hit $99,000
My plan now is to explore new markets. I'm investing heavily right now in Central Asia but state side -- I'm looking into mobile home parks and apartment buildings. With interest rates the way they are -- I'm having trouble identifying good cash flowing projects.
I'm ready and prepared to do an exciting 1031 when the time is right -- but right now, the portfolio is renting above $30,000 and my mortgage is only ~$19k
There's still plenty of deals in Detroit -- but the days of 50% appreciation gains on purchase I feel are over.
Here's a snap shot of the metrics for how things are going:
Overall -- I'm glad I aggressively purchased these. I think it worked out. I wouldn't recommend this to anyone -- ever. I'm extremely risk tolerant. I'm also obsessive about what I invest in -- and I chose Detroit because I saw what others didn't. And I think the incredible equity appreciation shows this.
Something I am looking forward to is the continued double digit appreciation of Detroits real-estate market. This is still one of the last few major cities with a football team where you can own a home for now $100k+ (Use to be a lot less lol )
Year over year, we're seeing 9-25% increases. Even with interest rates the way they are -- The last affordable cities in America are swallowing up. From Detroit to St. Luise to Memphis and throughout Alabama -- Affordable investing for homes well below $100k is coming to an end.
If millennials and Gen-Z ever dream of owning a home... It'll be in these cities. (probably Detroit) otherwise -- the supply of sub $100k housing is shrinking every month.
Here's the next 10 year outlook on my portfolio at just 5% appreciation growth:
I think the affordable housing crisis will continue -- And we'll see continued double digit appreciation for the next 5 years. Certainly, 9% I think.
The portfolio gets fun at 9%
So now I wait. In 5-10 years, I can pull out the equity and buy a yacht or something.
Thanks for reading -- And for anyone wanting to get started in real estate investing -- Do it. Ignore the noise. Believe in yourself. If you want to find deals in Detroit -- DM me for my property management team. (Today, and for the past 2 years, they have been amazing -- If that changes, bigger pockets will be first to know)
If anyone wants to explore deals together -- I'm interested in mobile home parks and apartment buildings. You can reach out via bigger pockets.
Thanks for reading and happy investing,
Jonathan