Since reaching a peak in 2006, home prices in the Detroit area have fallen 60.5 percent, according to the Fiserv Case-Shiller Indexes. As homes have become more affordable—the median home price in Detroit is lower than median family income—demand is expected to pick up. Prices are forecast to jump 33.1 percent over the next four years.
These are the glory days of the residential real estate investor. Low prices, rock-bottom interest rates and stable rental markets have created huge buying opportunities.”It’s awesome right now. I don’t think we’ll ever see another time like this,” said Tanya Marchiol of Team Investments, which has operations in about 10 states but focuses mostly on the Phoenix market.
These investors are known to many as vultures because they swoop in and buy “distressed properties” — foreclosures and short sales — cheap. Places like Las Vegas, Phoenix and Miami are popular because home prices there have dropped as much as 70%.
But how they’re investing has changed. In the boom years, they would buy a property and flip it for a quick cash out. Today, they are holding and renting for hefty, steady incomes.