Sep

23

A property statistics observation, prompted by this item:

Buy Houses in Detroit for $1500, Monthly Pmt. = $7

More than 15% of the homes for sale in Detroit, or almost 1 out every 7 homes for sale, is priced at $20,000 or less.

How much of the statistical weakness in house prices is related to utter freefalls in dead-end places like Detroit, Cleveland, Buffalo, etc., pulling down the averages?

Average income in Manhattan is a truly meaningless stat, as both seven figure compensation and welfare checks are common here.

What about "average" house prices, lumping together entire neighborhoods that are bidless along with suburban stretches just "giving back" the last couple years of appreciation?

Is this a meaningful distortion?

Tom Larsen remarks:

FlintI look at houses on line from time to time in Flint, MI. I look at my old neighborhood, and the houses are still going for the price my Dad sold his for in the 70s. The main difference is the factories are gone and the people are poor. Oh, and there weren't any drive-bys when I was growing up. You got beaten up, but no shootings. A house two blocks from where I grew up is listed for $25,000 on Zillow. At least it's not a dump. Maybe someone could make money buying these places. I'd live there (though my wife wouldn't), except I moved to San Francisco many years ago, and let's just say Flint is short on the amenities I enjoy here. Michigan has always been my "put" — if we run out of money, we will have to go back there.


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