The median value of a home in the United States is over $265,000. Some cities have seen hockey stick home price moves as people have fled big expensive cities for smaller ones or rural areas. This has been driven by the spread of COVID-19, but also a multiyear rise in the cost of living in some cities. Several cities have a relatively large inventory of homes for sale under $100,000. None of these has huge inventories, a signal that a sub-$100,000 home is still rare. Most of the cities with a number of $100,000 homes for sale are older industrial cities or ones in the poorer parts of the South.
Realtor.com looked for cities with the largest number of homes with prices below $100,000. The industrial cities included St. Louis, Indianapolis, Pittsburgh, Cleveland and Huntington. Southern cities included Birmingham Memphis.
The city with the most homes available for under $100,000 is badly beaten down Detroit, where the count, according to Realtor.com is 1,070. Interestingly, the median home value in Detroit, at $251,550, is near the national number. However, in some parts of Detroit, home prices have collapsed well below that.
Realtor.com attributes Detroit’s real estate markets to a few factors. “For decades, Detroit has been the poster child for industrialized cities in decline. First came the long ebb of auto manufacturing, then a crash of foreclosures during the Great Recession.” More recently, people have moved there to find affordable properties as they leave expensive cities hit by COVID-19. Interestingly, Wayne County, which includes Detroit, is one of the hardest-hit counties in America when it comes to COVID-19 deaths.
Detroit’s population has dropped below 700,000. It was over 1.5 million in 1950. Over a third of the people who live in the city limits live below the poverty level.
Realtor.com points to two neighborhoods in the Detroit area where home prices are particularly attractive. They are Grandmont-Rosedale and Warrendale. Grantmont-Rosedale is northwest of downtown Detroit just south of the border to Oakland County, the county just north of Wayne County. Warrendale is further west toward Detroit’s western border.
Oddly, the Realtor.com analysis does not include the hundreds of homes for sale in Detroit for $1,000. They are part of a project by the Detroit Land Bank to sell houses that have added to Detroit’s neighborhood blight. They are not, however, homes people would buy if they planned to relocate from somewhere else.