Hammered by the housing crisis, rampant unemployment, and a declining economy, the city of Detroit has thousands of foreclosed homes for sale with “fire-sale” prices — less than $1 in some extreme cases — that are attracting buyers from as far away as Australia and the United Kingdom, reports the Associated Press (“Outside Buyers Drawn to Detroit’s Foreclosed Homes,” March 9, 2009).

At one time Detroit, the capital of the nation’s auto industry, had one of the highest owner-occupied housing rates in the country. Now, however, the city has the lowest ownership rate for single-family detached homes of 20 of the largest cities in the United States, according to Detroit demographer Kurt Metzger.

Currently, there are more than 1,800 homes for sale for less than $10,000 in Detroit — homes that used to be worth more than 10 times that amount before the national real estate bubble popped, erasing about $2.4 trillion in home values across the country.

Last year, the average sales price of homes that were foreclosed on by the U.S. Department of Housing and Urban Development averaged $8,692, and at the beginning of this year, that price dropped to $6,035, according to HUD statistics. These bargain prices have helped spur sales of foreclosed homes in Detroit.

“In the past few months, I’ve picked up 10 new clients from out of state that are buying in bulk,” said Detroit real estate agent Mike Shannon, whose office specializes in foreclosed properties. “They’re coming to us, saying ‘Look, I want to buy 50, 100, 1,000 [homes].’ They want to own every decent and cheap house they can find.”

Shannon recently sold 30 homes in a single day to one buyer. And a trio of U.K. investors, he says, has bought a half-dozen homes and plans to buy many more.

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