For Sale: The $100 House

http://www.nytimes.com/2009/03/08/opinion/08barlow.html?_r=1

by dionidium • 17 years ago

52 52 17 years ago

numair• 17 years ago

I had discussed this with a reporter from Bloomberg a while back, who challenged me to buy one of these houses and see what happened; if I didn't live in an amazing place, I would definitely be doing this right now, for the exact reason that is alluded to in this article. As artists have been priced out of New York, Paris, and most of the other usual spots where they were able to congregate and cheaply live/create, there's been a real need for a new urban home; Berlin kinda does this in Europe, but we haven't really seen any particular place carry on the baton from New York here in the US. Detroit may very well become that city!

nostrademons• 17 years ago

Haven't there been recurrent musings on Hacker News about getting a bunch of friends together and buying up a whole city block in Detroit? Most of us could easily afford it, free and clear.

I'd totally be in if Google would open a Detroit office. ;-)

I predict that this is what'll happen with a lot of the rust belt cities: as prices drop low enough, people will move in and the city will be transformed into something no longer so rusty. Kinda like how Boston reinvented itself with high-tech after all the textile mills moved south in the 40s and 50s.

SwellJoe3• 17 years ago

Google has an Ann Arbor office. Long commute...maybe they have a shuttle.

irrelative• 17 years ago

But no engineering there... almost completely adwords.

patio112• 17 years ago

Most of us could easily afford it, free and clear.

$55 per $1,000 in assessed value due in property taxes, per year.

$75 if the property isn't covered by the "homestead" exception (i.e. you get one discount for a primary residence, everything else gets assessed at $75 per $1k.)

I rather doubt the city assessor's office will agree that the fair market value of your $1 house is $1, particularly after you invest money in making it habitable and/or after you successfully cause the neighborhood to be desirable.

Though for a fraction of what you pay in rent in San Fransisco you could own a perfectly suitable house in a perfectly suitable neighborhood in much of the Midwest.

lliiffee• 17 years ago

Interestingly, the "assessed" value in Michigan appears to be 50% of the "fair market value" of the house. So that would be an effective tax rate of 2.25%, not 5.5%. (This still seems to be higher than other midwestern areas.)

http://www.lansingmi.gov/finance/assessor/faqs.jsp#6

dkokelley• 17 years ago

Although provided you have fixed up a house or two and made the neighbourhood desirable, you could rent out one of the houses and use the income to pay the property taxes on all of them.

neilk• 17 years ago

I've been fascinated with this topic for a few months... but it seems that one has to be really resourceful to deal with life in one of those neighborhoods.

Startups, and coders in general, need to move quickly. All the services a modern city offers come into play -- from the guy you hire to design the logo, to the superintendent who fixes the radiator, to cheap and fast burmese takeout.

Those $100 houses are much more conducive to an artist colony, where people are willing to put in more effort and deal with reduced efficiency for greater freedom, and complete control over the outcome. It might be interesting to found a "hacker's colony" along the same lines but it would have to be pretty non-commercial, or be composed of hackers who already had remote working arrangements with paying customers. I mean, if the taxis won't even go to your neighborhood, you're not going to get a lot of client meetings done.

Xichekolas• 17 years ago

It sounds like a fun idea.

I wonder how much it'd cost to build a giant glass dome on your block. Properly designed it seems like you could have SoCal weather in your dome year round, with some security and ability to have interesting house designs to boot.

Edit: To answer my own question with some googling, rough cost estimates of building a giant greenhouse are about $8 per square foot... (using polyethylene, not glass). So to cover a city block, with a 20 foot setback, would cost about $1 million... I guess I might have to scale back that plan a bit.

brk• 17 years ago

Haven't there been recurrent musings on Hacker News about getting a bunch of friends together and buying up a whole city block in Detroit?

Wow. I remember discussing that exact idea with a hacker colleague back in probably 1995 or so.

Buy a block. Fix it up. Surround with barbed wire fence.

I friend of mine that I haven't caught up with for about 10 years now owned 4 houses on Appoline last I knew. He probably owns at least a dozen now. He had them setup almost like "rooms". One had the PC and TV on the first floor and a gym in the basement. He "lived" in another, one was for his mom, and the other for a cousin.

whatusername• 17 years ago

Net access? The article talks about homes that have had the copper wiring stripped from them. (Actually -- I do want to do a full reno of a house one of these days)... how do you get onto the Tubes?

quellhorst3• 17 years ago

Running copper from the telephone pole to your house is provided by the phone company.

Many cities require a permit and inspection before you can get hooked up to utilities. So gas and electricity will be harder and more expensive.

nitrogen2• 17 years ago

Gentrification, as I've heard it called, has its benefits as well as costs. As artists (or other creative types, like hackers :) move in and beautify a place, demand from professionals goes up and prices skyrocket. Even with the overall real estate market going down, I'm having a heck of a time finding a combined office/apartment at what seems like a reasonable price in my city, which is currently going through a major downtown renovation.

If only Detroit wasn't so cold...

mattmaroon2• 17 years ago

Their weather is fantastic in the summer months due to the great lakes. Lots of fishing/hunting/hiking nearby if you're in to that. Casinos, Canada (i.e. more casinos, plus legal underage drinking) a number of other cities are all nearby. Hockey worth watching, other major sports that are easy to get tickets to.

Might not be a bad place for a cheap summer home.

nitrogen2• 17 years ago

The hockey and outdoor activities would actually be quite nice, though I have easy access to good hiking where I live now. A ridiculously cheap summer home would also be fun, but when I think about it, I always come to the conclusion that the benefits of the summer home "feature" are outweighed by the long-term maintenance costs.

[Edit: though if a large hacker-driven entrepreneurial project actually managed to take over a city block, I would seriously consider moving in. I wonder how the music is in Detroit these days...]

swombat• 17 years ago

A couple of years ago you could even have remortgaged it for $100k! Win-win...

Interesting idea, though. Seems to me that as more and more people find themselves able to literally work from anywhere, this will happen more and more often. Why move to the end of the world to live cheaply, when you can just move to a cheap city within your own country and enjoy the same benefits, but with a similar culture?

patio112• 17 years ago

I'm often left to wonder this one myself, although I make a poor example for someone living in "my own country".

Much love for the folks in Silicon Valley, but lately we've got this series of tubes thing that can ship your code to your customers from just about anywhere. I used to live in St. Louis. Nice place! As of 2004 a roommate and I split a nice two-bedroom apartment, in a safe neighborhood with a nice twenty-something atmosphere, for about $800 a month.

If rent is $800 and your California-ramen-profitable startup is clearing about $3,000 a month then in St. Louis you can probably eat your ramen in a modest house which you bought to have a place to consume ramen in.

wyclif• 17 years ago

Well, part of the "do it in the Valley" advocacy is social or VC-oriented. All those alpha geeks in one place make a lot of connections, work together, recommend each other, go to similar events during rare non-work hours, and some even hire each other or found 2nd startups with partners they met working for their previous employer. For me, it's easy to grant the truth of this because the history of how these startups began is public record. I'd rather not try to deny that such connections have great value.

I tend to take a more romantic view, one that says that it doesn't matter so much if you don't live in SV or Cambridge, MA even if the current metrics show that your startup will be more successful in those places.

I wonder whether SV/Cambridge will lose a little pull since VC has dried up a lot. Also, buying a home is going to get a lot cheaper in rural places. Of course, not all cheap places are equal, but what if it truly, really didn't matter where you located? There's crucial things to research like infrastructure, high speed network capability, the reliability of the public utilities. The Midwest US could be a great place to found a startup.

It seems to me the desire to reach ramen profitability by operating cheaply can outweigh the cachet of advice and networking in the meatspace.

SwellJoe3• 17 years ago

Does Detroit still have a decent music scene? I haven't heard anything interesting coming out of Detroit since...the early 90s, I guess. But maybe just missed it.

I'm not planning on staying in the valley forever...might be fun to be involved in reinventing a once great city's downtown.

rms• 17 years ago

National acts seem to go to Detroit more than would be expected.

jerf• 17 years ago

If you don't live in this area, you may not realize that while Detroit proper is a wasteland (and Detroit proper is very large), the metropolitan Detroit area is doing OK. Not great, but OK, and it has a lot of other stuff in it. In most of the Metropolitan area, you'd never even know that the theoretical flagship city has been destroyed. There's still a big market for national acts to come here and draw from the rest of the metropolitan area, the Lansing area, Ann Arbor, and so on. For concerts, Toledo residents can reach, too.

jobeirne• 17 years ago

A lot of garage rock; notably, The Detriot Cobras and The White Stripes are from Detriot. A few others, too: http://en.wikipedia.org/wiki/Detroit_music#Rock_and_roll

SwellJoe3• 17 years ago

That'll do fine.

phd_student2• 17 years ago

is there a good search engine for searching these things? houses may be low enough to buy for recent college grads; if no such engine exists .... ycombinator idea? :-)

Vivtek4• 17 years ago

Realtor.com is the best place to start. Not everything gets onto the MLS systems, but most of it does eventually. Prepare to be amazed.

phd_student2• 17 years ago

amazing; thanks; hacker news really needs to get it's own block

markessien• 17 years ago

Are foreigners allowed to purchase property in Detroit at such prices too?

anamax3• 17 years ago

> Are foreigners allowed to purchase property in Detroit at such prices too?

How many places don't allow foreigners to buy property? (I've heard that Mexico has restrictions on foreign property ownership within a certain distance of the ocean.) How many charge more?

iamelgringo• 17 years ago

If a group of us set up a Hacker block in Detroit, I'm sure it would hit the New York Times as well.

colins_pride• 17 years ago

They're doing a good job laying the groundwork for "The $100 Newspaper" ..

rmason3• 17 years ago

Does Detroit have a decent music scene? The city has a very vibrant music scene whether it be rap,rock, blues or jazz with national artists showing up at local clubs for impromptu jam sessions.

rmason3• 17 years ago

Actually foreigners can buy property in Detroit. There was a story in the local paper about a group of Chinese investors buying up blocks of houses.

Can you imagine a Michigan YCombinator where they would own a block of houses and provide a place to live? A self contained entrepreneurial village? It would have to be an outsider as the locals just don't think that way.

quellhorst3• 17 years ago

I'm seriously considering a move up to Detroit. Is anyone else interested in getting a "hacker block" setup?

mattmaroon2• 17 years ago

Count me in. I won't live there, but I only live about 2.5 hours away, and could quite trivially afford a 2nd home there.

raffi• 17 years ago

I grew up in Detroit (suburbs) and plan to spend a little time there between relocating.

My cousin opened a restaurant by the old Tiger stadium and he is doing well. He DJs too and loves the Detroit scene. It has its own culture. Between Detroit, Windsor, and the Detroit suburbs there is a lot to do.

I grew up in Royal Oak, MI which is where the young professionals are settling now. We have a good downtown with decent night life, a lot of restaurants, boutique clothes stores, and good coffee shops. The winter weather isn't that bad. If you want bad--try upstate NY or upper MI.

My only complaints:

1. You need a car. No matter where you live expect to drive everywhere you go. I live downtown in Syracuse, NY and love walking to most places.

2. There are parks and such in the suburbs but the majority of lakes (aside from the great lakes) were sold off to the highest bidder. I really admire the twin cities in MN where someone decided to turn their beautiful lakes into public parks. When comparing MI to MN, I really feel like someone sold out the MI people.

jws2• 17 years ago

From city-data.com's data on Detroit:

  All numbers are per 100,000 residents, anually:
    Murders:       46
    Rapes:         40
    Robberies:    763
    Assaults:    1440
    Burglaries:  2060
    Thefts:      2430
    Auto Thefts: 2280
    Arson:         88

Aggregating "stealing" crimes, gets you 8,970 or about 9% chance per year. Adjust this for being "those rich dudes from out of town with all that electronic stuff" coupled with the $100 houses not being in the better parts of Detroit and I recommend good offsite backups and a personal philosophy that does not form attachments to material possessions.

quellhorst3• 17 years ago

Almost sounds like you need a compound, with double razor wire fences with an electrical charge somewhere in between.

lsb2• 17 years ago

Location location location. If you fear/hate your neighbors that much, why move there?

lsb2• 17 years ago

It's worthwhile noting that murder and rape significantly degrade quality of life, especially at a 0.1% per year.

As a 25 year old guy, you might think it's a cheap place, but try convincing a gf or a parent to visit you.

jws2• 17 years ago

I stayed away from that, but at .1%/year, within ten years you will attend the funeral of murder victim. Murder will be "real" for you, not just newspaper fodder.

rmason3• 17 years ago

That same case can be made against any city though Detroit's numbers are worse than most. However you would never have urban renewal at all if people let that stop them.

I have friends doing urban homesteading. Your first purchase should be an alarm service followed by web cameras watching the property. The goal is to intelligently cut your potential risk, they haven't had any problems - so far.

hotpockets• 17 years ago

But what is the throughput of people in detroit? Detroit has fairly few residents compared to the number of people who go into detroit to a casino/dining/sports game. The chance of one of these robberies happening to a resident is much less than 9% I would argue.

Also, you're forgetting about the "Broken window effect" which says that crime flees an area when the surroundings simply look better.

anamax3• 17 years ago

There's another risk, namely "community activists".

If you succeed in rehabbing in a depressed area, various rent-seekers will demand that you "share the wealth".

These folks often have considerable political clout, which has something to do with why those areas are depressed.

For some of them, your success is a problem because they're been paid to "improve the area". Since you succeeded without help, something is wrong, and it's not them. Or, you owe them.

misuba• 17 years ago

[citation needed]

anamax3• 17 years ago

http://www.detnews.com/apps/pbcs.dll/article?AID=/20090301/O...

Vivtek4• 17 years ago

I dunno about Detroit, but if anybody wants to join me in my move to Richmond, Indiana, I just bought a 4-bedroom house for $8000 there (cf. http://www.vivtek.com/blog/keyword_house.html). Closing next week, paying cash, and it still has its wiring, and a three-year-old roof.

look_lookatme• 17 years ago

Uh, wow, that house is huge. What is the town and neighborhood like? This is crazy...

Vivtek4• 17 years ago

Richmond is a town of about 20,000 people, rust belt, some local industry still surviving. It has Earlham College, a Quaker liberal arts college. In terms of "scene", well, from comments here I'm sure all you young urbanite whippersnappers would be disappointed. In terms of sending my daughter to Earlham College for classes at $100/credit hour through the local high school's talented-students program, though, I'm totally pumped. Also the concept of not paying rent or mortgage at all, well -- thank God I can work entirely online, but y'know? This is really working for me.

Yes, the huge is freaking huge. I didn't actually think to look at aerial photography until after I'd bought it. I could probably start my own artist's colony just with the one house. Or hacker colony, whatever the hell that means. I guess with a big enough pipe, that would work out.

See the half-hexagonal bay window structure on the second floor? That's going to be the library.

The neighborhood is mostly blue-collar, mostly rentals now. In the early 1900's, or 1890, when this house was built, it was the Place to be Seen. I'm told there's a slight trend towards gentrification; these houses are truly stunning, and they built them to last.

I guess for the sake of fairness, I should quote city-data.com:

   	 	2007:
  Murders 	0.0
  Rapes 	37.7
  Robberies 	153.5
  Assaults 	255.9
  Burglaries 	1220.1
  Thefts 	3668.3
  Auto thefts	323.2
  Arson 	115.8

dtap• 17 years ago

http://redemptionincorktown.blogspot.com/

A friend of mine's blog about buying and fixing a house in Corktown in Detroit. It is very interesting to see a dilapidated house that is from 1856 be renovated to a 4000+ sq. ft. place. He is very handy and has done habitat for humanity for years so it may be a stretch for some people to do.

Nonetheless, a personal look at white middle class living in Detroit.

For Sale: The $100 House

Related Stories