Detroit boasts one of the most affordable housing markets in the U.S. today. As host to several major automotive manufacturing plants, Detroit bears the nickname “Motor City” and enjoys an economy that provides stability and high earnings to many people who decide to live there.
Even more, the solid housing market, combined with the earning potential, allows people who invest in residential properties in Detroit to earn lucrative returns on their investments. You can appreciate what the Detroit housing market offers you as a potential buyer or investor by exploring its most recent trends.
An Overview of the Detroit Housing Market
Overall, the housing market in Detroit is currently a seller’s market. That is, there are more buyers in the market than there are available houses for sale.
Moreover, the average price for a house for sale in Detroit is markedly lower than the national average. A house in Motor City sells for around $75,000, which sharply contrasts with the national average of $436,000.
Additionally, around 95 percent of the houses for sale in Detroit sell for at or close to their asking price. In April 2023, just under 25 percent of houses sold above their listed price. Around 22 percent sold under their listed asking price.
Housing prices likewise continue to increase every month in Detroit. This increase in housing prices coincides with the growing rental market. Still, even with more people renting and housing prices on the rise, Detroit remains one of the most affordable and lucrative housing markets in the country.
Factors Behind Detroit’s Solid Housing Market
Several factors exist for why Detroit has one of the best performing housing markets in the U.S. right now. In the last few years, there has been a concerted effort to revitalize the city.
Leaders behind this movement have focused on improving residential neighborhoods, bringing new life to old and dilapidated buildings and improving property values. Their efforts have paid off, in part, because the housing market now boasts some of the most affordable and viable residential properties for sale.
Additionally, new businesses continue to flock to Detroit. Not only is the city home to major automotive manufacturing companies; it also has welcomed manufacturers in other industries, as well as a number of local and national startups. This influx of new businesses has resulted in families moving to Motor City in a bid to buy housing and raise their children there.
Finally, the increase in people and businesses moving to Detroit has led to more people needing or wanting to rent housing. As more people look to rent, they create an ideal environment for real estate investors. People who buy real estate often make solid returns on their investments because they can quickly and conveniently rent out their houses, apartments and other buildings and gain reliable rental incomes.
2023 Detroit Housing Market Trends
Several noteworthy trends from 2023 stand out in the Detroit housing market. One of the most interesting facts involves the lower prices for houses for sale. The average house sale price in the U.S. stood at around $400,000 in 2023.
However, prices for houses for sale in Detroit during the same year hovered between 73,000 and 75,000. These prices translated into an average of $69 per square foot.
Further, this year saw more buyers enter the housing market in Detroit than there were available houses for sale. This influx of buyers created a high demand for housing, which in turn translated into higher returns for real estate investors. It helped as well that 95 percent of the houses for sale sold at their listed asking prices.
Finally, houses for sale in Detroit remained on the market for an average of 43 days. This average is lower than the national average of 50 days. People with homes to sell, as well as investors in the real estate market, enjoyed fast returns in 2023 because of this trend.
Detroit Housing Market Predictions
Given the trends in 2023, it may be safe to assume that the affordability and lucrativeness of the Detroit housing market will continue for the foreseeable future. In fact, prices for housing continue to trend upward. This upward trek allows investors to make solid returns on the money they put into the Detroit housing market.
Likewise, newcomers to Detroit continue to look for houses to buy or rent. Detroit attracts people from across the country and world to settle there, thanks in large part to its recovering economy and scores of available manufacturing jobs. As people move to the city to take jobs in the businesses there, they seek housing to move into right away. People with real estate to sell or lease can make faster returns and enjoy larger profits than real estate investors in other parts of the country.
The Detroit Housing Market versus the National Housing Market
The Detroit housing market shares several common features with the national housing market. Most notably, there are more buyers in the national market than there are houses to buy. Inventory continues to remain slim in many cities across the U.S.
Likewise, the rental market in the U.S. housing market remains robust. More people prefer to rent right now while housing prices and interest rates trend upward. Investors who buy properties for the purpose of renting them stand to make solid returns on their money, as many rental properties lease quickly in cities throughout the country.
Finally, houses that are listed for sale sell relatively quickly. The average amount of time it takes for a house to sell in the U.S. is around 50 days. This fast turnaround allows sellers and investors to enjoy quick returns.
Team with Upside Investments to Find Your Next Detroit Rental Property
Whether you’re an out-of-country or out-of-state investor, Upside Investments offers a comprehensive suite of services to navigate you through every stage of your investment journey. From acquiring properties in this increasingly lucrative market to expert renovation and efficient rental management, we ensure your peace of mind and maximize your returns. Join us and unlock the potential of Detroit’s real estate market with a team that’s as invested in your success as you are.
