It’s a perfect time to buy low-priced real estate in Flint.
“You can buy a three-bedroom house for $15,000. I don’t know where else you can go out and get a house for $15,000 that’s in move-in condition,” says George M. Howard Jr., a mortgage broker and personal wealth mentor. “And that’s where you start talking about economic gain for investors.”
Certainly, people with financial means are taking advantage of the situation, but those without money or good credit don’t have to be left out of the process.
“It’s a great time to buy real estate in Flint. The people can see the gentrification process beginning in their city, however, they don’t have the opportunity or the means,” he says.
“We’re helping people to be able to buy houses for a little more than $500,” he says. “Collectively, we’ve pulled ourselves together, get local resources, and we’re expanding to Flint, Detroit and other cities, helping people in other areas we’ve identified as the next gentrification spots so we can take advantage of this.”
To be sure, Flint is slowly rebounding from its water crisis. In February, the number of Flint properties going into foreclosure was 11 percent lower than in January and 23 percent lower than the same time last year, according to RealtyTrac.
These circumstances make it an ideal time to invest in Flint, local investors say.
“Now is an excellent time to buy a house in Flint,” says Willie Ray, the broker for Changing Streets. “The water’s been coming back clean and the prices are still low. You have a chance to purchase a home for near rock-bottom prices and history shows the prices are going to go up.”
In some sections of Flint, properties for sale can be found as low as $2,000 to $5,000, Ray says. His company’s latest listing is a four-bedroom, three-bath house for $56,000. If the house was located in Oakland County, he says, it would be listed for $200,000.
“It probably will take a few years to come back strong, but Flint will be back,” Ray says. “I own several properties in Flint, rentals purchased during the recession. Values are definitely coming back. But compared to surrounding areas, prices for homes are still very low.”
The median sales price for non-distressed homes is $30,000. The median price of foreclosures is $11,800, or 61 percent lower than non-distressed home sales. Nearly 22 percent of houses in Flint are vacant, RealtyTrac reports.“You can still buy property at a very reasonable price,” says local investor Bill Clark, president of Vash Investment Group. “Now’s the time to do it because the values are starting to creep back up. With the new infrastructure going in, it’s going to help the economy even more.”
Clark, an investor for 30 years, says there hasn’t been a better time. “You are not going to lose out based on the money you’re going to put into it,” he says. “I’ve never seen prices lower than this. The market value is 50 percent lower than it used to be going on the basis of a 2007 appraisal. From an investment standpoint, that’s phenomenal.”
Howard says Flint will soon gentrify. It’s already happened in cities such as New York, Los Angeles and Washington, D.C. He encourages residents to jump in now.
“We’re positioning ourselves,” he says, “because these areas are going on sale because it happens in almost every city, starting in the poverty-stricken areas and expanding. When we can’t do it by ourselves, we partner. If you don’t know how to rehab, you can sell as is. The most important thing is to learn how to do this, and to get going.”
THE WISE BUY
While Flint property values have dropped more than 60 percent since 2008, at the onset of the national housing recession, a buyer’s market can mean good news to the community. High vacancy rates in some areas aren’t necessarily a sign that the neighborhoods aren’t good places to live, but remnants of the past eight years when the city lost more than three quarters of its taxable value, according to state records.
The good news is low costs can offer great opportunities for first-time homeowners, or second chances for those still suffering from credit damage, due to prior foreclosures. Investing in a house that might be affordable enough for a cash purchase or land contract can have great benefits, but only if you know what you’re buying
Here are tips from real estate pros, to help you learn when a good deal won’t cost more in the long run:
• Look up – A roof in poor condition can be the most expensive home repair, but a newer roof, especially one made of sturdy material, can lower homeowners’ insurance rates.
• Check for cracks – Large or long fissures, especially in the basement, can signal foundation problems that cost thousands to repair. Doors that don’t close properly or don’t fit squarely in doorways can also suggest structural defects.
• Smell test – Examine the inside and outside of the house for odors that might suggest clogged sewage or plumbing issues.
• Turn it on – Activate faucets, flush toilets, check for leaks under sinks, open and close windows, and flip light switches. A basic walk-through can reveal what works and doesn’t.
• Call an inspector – The City of Flint no longer performs point-of-sale home inspections, but hiring a private contractor offers a qualified eye.