Downtown Rents

[detroithealth]

There's definitely progress.

But also, a lot of these landlords know they can charge higher because of the Live Downtown incentives. So you have some 25 yr old who can afford X but knows he/she is going to get a $5K credit to live downtown, and suddenly his/her housing budget jumps drastically. Take away the Live Downtown subsidization and landlords would not be getting these rental rates. Yet. Yes, that's the point right? But it also doesn't offer accurate insight into what the average downtown unsubsidized loft dweller is willing to pay in the current market.

[MikeyinBrooklyn]

I agree about the Brewsters! I always thought they looked structurally sound enough - and you can't beat the location. Seemed like a no-brainer to market as a rehab opportunity.

I can't speak about the Brewsters because I am not overly familiar with them, but I think major rehab projects can be much more costly than tear down/new developments [[I am aware that many things are torn down and yet to be redeveloped). To merit rehabbing it either needs to be mostly cosmetic work on a building with "good bones", or a project of such architectural or historical merit that they will be able to charge a real premium on the reno'd units.

I think Detroit's pace of residential development in both downtown and midtown is fine. First, there are many more units than there were five or ten years ago, and they are largely occupied. Second, a number of projects are underway. Third, a true "boom" in housing could very possibly bust. Lastly, we shouldn't forget that as more commercial comes to downtown/midtown, a lot of real estate [[both land and existing buildings) might make more sense as commercial developments than before Dan Gilbert transformed the downtown office market. So, that might be giving some pause to develors, which is not a bad thing. Opening a moderate amount of units each year, supported by the market, will lead to healthier prices and lower vacancy rates in the long run. I think Corktown and neighborhoods along the "Lodge corridor" will be the location of more housing development in the next ten years than downtown and midtown.

[detroithealth]

In Toronto or Chicago an undistinguished building would go for far more than that just because of the location. Basically anywhere near a transit station would go for that much or more. So there are definitely still a lot of problems like you said, and those are keeping the prices down lower than they should be.

Comparing downtown Detroit to rental rates in other cities is illogical. This city is unlike any other major city downtown in America when you factor in safety, services, transportation, night life, well maintained public spaces and dinning options - all of which contribute to the pricing you see elsewhere.

[Jason]

Comparing downtown Detroit to rental rates in other cities is illogical. This city is unlike any other major city downtown in America when you factor in safety, services, transportation, night life, well maintained public spaces and dinning options - all of which contribute to the pricing you see elsewhere.

Yes that's literally what I said. The quality difference between Detroit and other cities is why Detroit is so cheap, and why Detroit under "normal" circumstances should be much more expensive.

Instead of saying that something is causing rents to quickly spike, I think it's more accurate to say that various problems are being improved, and so Detroit's prices are slowly rising closer to where they *should* be.

[DetBill]

Not quite.

Not to sidetrack, but in regards to Lafayette Park being a good area for renters/ buyers. I have been in Lafayette Park since 1990 for all except three years..[[2002-2005) Its quite good, ofcourse ,there have been some car thefts, some breakins,, and a couple of shootings over the years , but there arent very many urban neighborhoods in any large midwest city that cant chime in the same fashion, It is part of urban living and you had better get used to that. I have personally never had one incident,, and in good weather I run almost daily around downtown and the riverfront and generally walk a 4 mile walk through greektown, to woodward, up to grand circus, down broadway and back to Lafayette Park daily on almost every day of the year to keep fit,, Never have had a issue yet since 1990 other than people wanting money. I certainly wouldnt say Lafayette Park is dangerous,, but always keep my eyes open. You do see some sketchy individuals from time to time. Overall, it is a great neighborhood. The amount of amenities for entertainement, eating, culture and sports within walking distance is very impressive. I do not, and have never gone in areas of Detroit that are considered dangerous unless my car is locked and Im inside. Detroit is a large city, theres lots of areas, especially downtown and midtown that are pretty good. . With all the amenities now, my trips across 8 mile are fewer and I dont miss it by any means. Ofcourse anymore I am careful in Royal Oak and Ferndale when I do visit. I have friends living there that have also had been victims of crimes there, although the murder rate is lower that the city overall ofcourse. Sadly this is our way of life.

[Cincinnati_Kid]

Well lets be accurate. Detroit was known as the Paris of the West.......

That would be of the Midwest. Rental hikes are just another scam to gouge people. Soon as the housing market shows signs of life, rentals go up.

[Chinman]

all of you have great points, but first of all, Brewster Place was actually Brewster Projects. It was a U.S. HUD place that is still owned by the Government. U.S. Housing law states that it can not be developed unless a comparable housing place can be built. What happened was that nothing was done for years and the Govt. lost the lease and it is now in the hands of the State of Michigan and Detroit. Somebody has the Land and it will be developed.

[wolverine]

I always find it funny when people bring up the price of rentals in cities like San Francisco, New York, Chicago and other world class cities in these discussions about Detroit. Isn't is more appropriate to bring up comparable cities like Cleveland, Milwaukee, Columbus, Toledo and Grand Rapids? I was also going to comment on the rising rent but it seems Bailey has summed it up perfectly.

Just for the sake of some images.

* Please note, data is affected by map zoom resolution and I didn't set any scale

Maps from:
http://www.trulia.com/home_prices/Il...cago-heat_map/














I'm not a fan of price per bedroom data, rather price per square foot per month, but this is the info conveniently available.

[detroithealth]

Not to sidetrack, but in regards to Lafayette Park being a good area for renters/ buyers. I have been in Lafayette Park since 1990 for all except three years..[[2002-2005)...

Curious. What are your paying for rent, if you're renting? Total and per sq.ft? How much are you paying a month for auto/renters insurance? Do you use your Detroit address for auto insurance?

[313rd]

Being part of the construction industry, I've seen and/or been involved on some budget pricing for some residential projects that have not hit the public radar. There will be some great news on residential developments in the near future.

[TTime]

Thanks Wolverine, great info. Looks like Grand Rapids gets you a lot of bang for your buck. I have searched for apartments there in the past and have been blown away by how nice and reasonable the rentals are and your map seems to confirm this....well, the price aspect at least.

[Spartan]

Curious. What are your paying for rent, if you're renting? Total and per sq.ft? How much are you paying a month for auto/renters insurance? Do you use your Detroit address for auto insurance?

FWIW, I rent in Lafayette Park, pay a little less than $1/sq ft [[around $750 for a 1br), and about $200 for insurance [[auto/renters combined).

[Chinman]

renting is only for a few high-rises. most low-rises are owner only. you can rent a space under 680 sft for around $800, but you also get a safe building, on street parking and a guard at the door to let you in. Lafayette Park Area has all different rates and options. it is diverse in rates and amenities. Even if you are a first-timer paying the lower rate with a small square footage, you can get what you need and have a city-life that can rival the Suburbs. Just try and you can find the Joys of Downtown Detroit.

[Joseph C. Krause]

Corktownyuppie,

My statement was a bit hyperbolic. There has been mostly gradual improvement every year I have lived in the city, so we actually do agree on that. My complaints stand, though, and I feel that for over $1500 per month, I should be able to travel a few miles on transit without too much of a hassle, especially living more or less in the center of downtown. Everyone moving in gets to live a suburban lifestyle, driving where they need to go even though they live downtown, and this keeps the pressure off having all daily needs right outside the door, which is what I consider to be real urbanism.

For the rental rates now, it is still possible to live in Queens, NY, in a completely walkable neighborhood with 24-hour amenities even if it's a 45 minute train ride to Manhattan. And really, just improvements in the regular bus and a 24-hour drug store would get us much, much closer to that degree of livability.

[Wesley Mouch]

There's definitely progress.

But also, a lot of these landlords know they can charge higher because of the Live Downtown incentives. So you have some 25 yr old who can afford X but knows he/she is going to get a $5K credit to live downtown, and suddenly his/her housing budget jumps drastically. Take away the Live Downtown subsidization and landlords would not be getting these rental rates. Yet. Yes, that's the point right? But it also doesn't offer accurate insight into what the average downtown unsubsidized loft dweller is willing to pay in the current market.

People always subtract the credit from their housing costs. Landlords ADD the credit to their rents, so they get most/all of the benefit. Ah, the market.

No different than student loans. You think they made college more affordable? Yeah, right. The schools vacuumed up the extra cash students threw at them -- built new shrines and increased the pay for tenured professors and administrators [[the 1%) and ignored the Grad Assistants [[99%).