Starting out in Detroit

[Lisa K.]

Hi Everyone

I am an intern architect based in Downtown Detroit. Although young and new to real estate, I have experience designing and building throughout the city. At this point, I’m looking for that starter investment- either a duplex I can live in while renovating the other unit, or a small house that I can rent out. How has this approach worked for you?

Because of my location – I would like to hear more about your experience investing in what are considered “risky” or “upcoming” neighborhoods. Values are low in Detroit’s market (surprise!) but in some neighborhoods values are rapidly growing and expanding. Ideally I would like to snap up a few foreclosures while they’re cheap and help contribute to the area growth.

I have been reading, listening to, and observing BiggerPockets for a while. This is a great site, and paired with local connections are really helping build up my knowledge and confidence. Thank you!

[William H.]

Well, welcome! @Lisa K.

If you've been listening, then you probably have thick skin about the investments up there, haha. Many of us love the town. I do.

There's a right way to invest in Detroit. Well, more than one I'm sure. But it's the same as everywhere, think through it thoroughly and be careful. I mean, everybody has to be careful if they're looking for their first investment, and especially if the strategy includes "risky" areas.

I feel I could talk a lot, but I tend toward long posts anyway...

1. Most importantly, do it. Go for it.
2. Second, No Problem with a risky area, just know how to gauge how risky (turnaround time of the area, patience and what you have to do in the meanwhile)
3. When you are young and doing something dicey, it pays to know yourself and add extra margin for learning curve. (How long to renovate as a diy, how much cost overrun, i.e., how do you save $ in the process.)