More luxury homes are going on the market in Metro Detroit as sales accelerate.

[Honky Tonk]

"There was no proof he was a Detroiter other than he was black. He could have easily been from Grosse Pointe, Harper Woods, or Timbuktu for that matter."

I agree. For all you know he could've been a GPF stockbroker who's cell battery died, and he needed to make a transaction, ASAP!

[Bham1982]

Hell of an opening strawman, Bham. The article referenced in the original post discusses a home in West Bloomfield at Walnut Lake and Halstead. Schools and services are considered good relative to most other suburbs and the city.

It's hardly a strawman. This is the most isolated, least developed far corner of W. Bloomfield. It's heavily dirt roads and well water. And W. Bloomfield schools are generally worse than all the surrounding school districts.

You assume the home has "crappy construction". Why? While it is possible to build a modern home poorly, or use the cheapest materials, the pricey new homes I've been in have been well-constructed with quality materials. The old=good, new=crap viewpoint is uninformed. For every knockout Palmer Woods mansion there are 100 Brightmoor shacks.

I'm comparing apples-to-apples. A Brightmoor shack isn't a good comparison to a $2 million home. If you want to compare, say, $500k executive homes, there's no comparison between some new subdivision in Milford and an older home in Grosse Pointe Farms.

In that area of West Bloomfield there are a lot of Chaldean families where the adult children often live with the parents. It's common to have three generations in the house. So if they can afford it, what business is it of ours how they choose to live?

The point is "they" obviously can't afford it. Ever heard of the real estate crash? Too many people bought too much home, and everyone else pays for it.

You ask why does any one need 7500 sqft. You might as well ask why does anyone need 7500 songs on their iPod? Or 15 watches, or 50 pairs of shoes, or 8 bikes or a top of the line Mac when a simple PC will do what most users need. It seems a little intrusive and intolerant to be so concerned with how others choose to live their private lives and allocate their funds.

Totally false analogy. Americans didn't see their lifetime accumulated savings destroyed because someone downloaded too many songs. The global economy wasn't brought to its knees because some folks bought too many shoes. Household
net worth was shattered because too many idiots bought too much home, and we're paying for it.

The typical foreclosure costs the banks about $50,000, which is passed on to the consumer.

The Fannie Mae bailout was $116 billion. The Freddie Mac bailout was $76 billion. The TARP bailout was $700 billion. Then there was HAMP, then HARP, now HARP II. It never ends. Oh, and everyone's home is worth 40% less.

So, yeah, I think people have the right to question the exact same behavior that nearly brought down our economy a few years back.

[bailey]

I'm not referring to the crime, just the proximity is enough to make many people with kids leery. If you live near Windmill Point in one of the nicest parts of Grosse Pointe what do you tell your kids? "Whatever you do when you ride your bike up the street DO NOT TURN LEFT!". Seems silly to have that much money and live in such a Dickensian area.

Short answer... Yes. You do not ride your bike across Alter. For any reason. growing up, the only reason any kid had any business crossing Alter was to buy drugs at AP.

Seems silly to have that much money and live in such a Dickensian area.

Seems far more ridiculous to live on a dead end street in the middle of a former cow pasture that requires your kid be driven to every. single. after school activity because your cul du sac empties out onto M-59 and you live 6 miles from any school.

With the exception of a veritable war zone of poverty and blight across the border in Detroit, GP is the very walkable, dense [[for a burb), and sustainable living everyone claims to demand.

[iheartthed]

Totally false analogy. Americans didn't see their lifetime accumulated savings destroyed because someone downloaded too many songs. The global economy wasn't brought to its knees because some folks bought too many shoes. Household
net worth was shattered because too many idiots bought too much home, and we're paying for it.

The typical foreclosure costs the banks about $50,000, which is passed on to the consumer.

The Fannie Mae bailout was $116 billion. The Freddie Mac bailout was $76 billion. The TARP bailout was $700 billion. Then there was HAMP, then HARP, now HARP II. It never ends. Oh, and everyone's home is worth 40% less.

So, yeah, I think people have the right to question the exact same behavior that nearly brought down our economy a few years back.

You didn't even mention the best part. Wait until these townships that fronted all of the money for that infrastructure to build these McMansions start to go belly-up because the property tax receipts never materialized to pay for that crap. What type of chain reaction will a city of Detroit bankruptcy set off in the ex-urbs when the ratings agencies start downgrading that debt out there?

[Detroitnerd]

These inner ring suburbs don't offer the same as exurbia.

I think that's the point we're making.

I raised two kids in Harper Woods in a 1000 square foot house and there were a lot of times I wish I had a larger house with a larger lot for them to play in. My point is people on this forum like to praise any apartment building that opens in Detroit and then points there finger at people who want to build their own home in exurbia. I find the irony amusing.

I don't see any irony. I see somebody whose taste perhaps differs from many on this board. You want larger lots? That's fine. I don't think you'll find anybody on here who says you shouldn't have larger lots if you want them, just pay for it all yourself and don't expect the whole system to subsidize that way of life.

[Detroitnerd]

No, you spurious sophist, the attack on exurbia was made because it was detrimental to the "holy city" and the main disadvantages listed for a 5,000 sq ft house in exurbia was that it cost too much in maintenance and that the heating expense was too much. In addition, it was decried that the value of such homes had declined drastically since 2006. I thereupon compared a 5,000 sq ft home in exurbia to a 5,000 sq ft home in Brazzaville on the Detroit River where the upkeep, heating bills, and taxes were a big bite out of an annual income and the intrinsic value was depreciating faster than an ice cream cone on an hot August day.

Again, why have you constructed this continuum in which there are two choices: exurbia or the city? There are lots of environments that aren't exurbia, Hermod, and a metro historian such as yourself knows the range of them. Original settlements like downtown Rochester, puny though it is. Streetcar suburbs like Birmingham. Outposts gone urbane like west Dearborn. Cities that were once independent, like Wyandotte, now subsumed into the metroplex. Places with their own history and tale to tell in the development of the region. Even distant but accessible places such as Ann Arbor and Ypsilanti might fall into our metroplex by some definitions.

But exurbia, those places without histories, heritage, or anything but an association sign to describe what once was there before it was carved into a cookie-cutter money-machine for developers, stands on its own in this discussion.

I know that, given your penchant for grandstanding against the city, you'd rather that this was a polar debate with two sides to it, but I must point out that it isn't.

Now, we were talking about exurbia and its prospects ...

[poobert]

My point is people on this forum like to praise any apartment building that opens in Detroit and then points there finger at people who want to build their own home in exurbia. I find the irony amusing.

I don't know where you came up with this shit, but you are the only person who brings it up. In fact, you brought it up three times on this thread alone. While everyone else is offering reasonable ideas about surplus housing in the Metro region you continue with your broken record of "apartments in Detroit" and "nobody wants to live in Detroit because of services." Again, look throught the thread, you're the only one doing this.

You have a pathological hatred of people chosing to live in apartments in Detroit, or Detroit period, for what reasons I can only guess. Look, I think people should live wherever they want. I think Grosse Pointe is probably the nicest area in the Metro region. I live in Detroit but wouldn't want to live in an apartment again, but obviously people do because they sell like mad downtown and in Midtown. A lot of people like that lifestyle - they're not like you, and they don't have to be - it's a free country, okay? If you can't get over the fact that people here are happy to see less vacancy in Detroit then you should probably pack your bags and head to the Free Press message boards because you're not going to be happy here.

[Detroitnerd]

i don't know where you came up with this shit, but you are the only person who brings it up. In fact, you brought it up three times on this thread alone. While everyone else is offering reasonable ideas about surplus housing in the metro region you continue with your broken record of "apartments in detroit" and "nobody wants to live in detroit because of services." again, look throught the thread, you're the only one doing this.

You have a pathological hatred of people chosing to live in apartments in detroit, or detroit period, for what reasons i can only guess. Look, i think people should live wherever they want. I think grosse pointe is probably the nicest area in the metro region. I live in detroit but wouldn't want to live in an apartment again, but obviously people do because they sell like mad downtown and in midtown. A lot of people like that lifestyle - they're not like you, and they don't have to be - it's a free country, okay? If you can't get over the fact that people here are happy to see less vacancy in detroit then you should probably pack your bags and head to the free press message boards because you're not going to be happy here.

clap clap clap clap clap clap

[Honky Tonk]

" A lot of people like that lifestyle - they're not like you, and they don't have to be - it's a free country, okay?"

Exactly. If I want to live in a McMansion across the street from those evil cows, and not in a $1700 a month crackerbox, I should be able to.

[michimoby]

" A lot of people like that lifestyle - they're not like you, and they don't have to be - it's a free country, okay?"

Exactly. If I want to live in a McMansion across the street from those evil cows, and not in a $1700 a month crackerbox, I should be able to.

Don't think you can get away with that subtle use of "cracker"box, "Honky" Tonk. I'm on to you.

[Bham1982]

Exactly. If I want to live in a McMansion across the street from those evil cows, and not in a $1700 a month crackerbox, I should be able to.

I don't think anyone would disagree with this.

The issue is that the public subsidizes this lifestyle choice, and pays the price when folks get in over their heads. This is the crux of the problem.

Certainly there should be opportunities to live in the sticks. But those homeowners receive the federally subsidized mortgage deduction. They require new streets, utilities, and services, much of which isn't borne by the locality. And when they can't pay the mortgage, everyone else "pays the mortgage".

We currently subsidize people to take on too much house relative to their net worth. The risks aren't borne by the homeowner, but by society at large. That's why society should have a say in the matter.

[iheartthed]

I don't think anyone would disagree with this.

The issue is that the public subsidizes this lifestyle choice, and pays the price when folks get in over their heads. This is the crux of the problem.

Certainly there should be opportunities to live in the sticks. But those homeowners receive the federally subsidized mortgage deduction. They require new streets, utilities, and services, much of which isn't borne by the locality. And when they can't pay the mortgage, everyone else "pays the mortgage".

We currently subsidize people to take on too much house relative to their net worth. The risks aren't borne by the homeowner, but by society at large. That's why society should have a say in the matter.

Exactly. If you want Elsie as your neighbor then you need to pay to pave that road to get you there on your own.

[Honky Tonk]

I don't think anyone would disagree with this.

The issue is that the public subsidizes this lifestyle choice, and pays the price when folks get in over their heads. This is the crux of the problem.

Certainly there should be opportunities to live in the sticks. But those homeowners receive the federally subsidized mortgage deduction. They require new streets, utilities, and services, much of which isn't borne by the locality. And when they can't pay the mortgage, everyone else "pays the mortgage".

We currently subsidize people to take on too much house relative to their net worth. The risks aren't borne by the homeowner, but by society at large. That's why society should have a say in the matter.

I totally agree with you. This is one of the issues I have with tax breaks for the 1%, [[here we go). I have to pay the full amount, yet the 1% get to drive on, drink from, and poop into, infrastructure that I paid for, yet because of their position and wealth, THEY get tax breaks, and loopholes, I do not. I continue to pay. [[sorry, I wandered off a bit). The cow field McMansions want water, electricity, sewer system, etc., and yes, we're subsidising it, it's not being covered by the investors or the taxes those residents pay.

[Det_ard]

It's hardly a strawman. This is the most isolated, least developed far corner of W. Bloomfield. It's heavily dirt roads and well water. And W. Bloomfield schools are generally worse than all the surrounding school districts.

Except it's not WB schools, its Walled Lake schools, which are generally well regarded. Its not isolated, its very close to shopping and M-5. It has municipal sewers and city water not well water, and while there are some dirt roads [[like Royal Oak), the majority are paved. Its listed at $1.29 million, not $2 million. There are no cows or trailer parks anywhere nearby. So what the hell are you talking about? A strawman.

The point is "they" obviously can't afford it. Ever heard of the real estate crash? Too many people bought too much home, and everyone else pays for it.

Who is "they"? If you're talking about 2006, you're right in many cases, although the vast majority of houses that were foreclosed on were not expensive houses. Today however the qualifications required for a jumbo mortgage are pretty stringent. 720 credit, 20% down minimum with some lenders requiring up to 40% down, debt-to-income no greater than 36% - 38%, liquid reserves equal to 10% of the total loan amount. There are no more stated income loans, no more liar loans, no negative am loans, it's 2012, not 2006. The idea you put forth that the people buying $1MM+ homes today can't afford them is simply wrong. In fact 1/3 of all $1MM+ home buyers this year in metro Detroit paid all cash. The rest had to exceed fairly tough underwriting standards.

Totally false analogy. Americans didn't see their lifetime accumulated savings destroyed because someone downloaded too many songs. The global economy wasn't brought to its knees because some folks bought too many shoes. Household
net worth was shattered because too many idiots bought too much home, and we're paying for it.

The typical foreclosure costs the banks about $50,000, which is passed on to the consumer.

The Fannie Mae bailout was $116 billion. The Freddie Mac bailout was $76 billion. The TARP bailout was $700 billion. Then there was HAMP, then HARP, now HARP II. It never ends. Oh, and everyone's home is worth 40% less.

So, yeah, I think people have the right to question the exact same behavior that nearly brought down our economy a few years back.

I'm with you on the outrage about the cost to taxpayers of the bailouts and the government's role in backstopping mortgage loans. You seem to have an issue with someone you know that you think is in over their head and bought in an area you don't like. Don't let that cloud your assessment of the overall market today.

[Bham1982]

Except it's not WB schools, its Walled Lake schools, which are generally well regarded.

WB and Walled Lake Schools both have test scores below their neighbors [[Bloomfield, Birmingham, Novi, Northville), so I would disagree. These buyers can live anywhere, and I assume you aren't comparing to Pontiac.

Its not isolated, its very close to shopping and M-5. It has municipal sewers and city water not well water, and while there are some dirt roads [[like Royal Oak), the majority are paved. Its listed at $1.29 million, not $2 million. There are no cows or trailer parks anywhere nearby. So what the hell are you talking about? A strawman.

There's a trailer park to the east [[Orchard Lake) and at least one to the west [[Pontiac Lake). There's very little retail except along Orchard Lake, and you have to fight traffic along two-lane, winding, Pontiac Lake to get there. The whole area is a traffic nightmare, because of the lakes.

And no, Royal Oak doesn't have dirt roads like Commerce-WB has dirt roads. That's just absurd. We should be preserving open space and promoting infill, rather than subsidizing construction on virgin land, especially in a shrinking region.

Who is "they"? If you're talking about 2006, you're right in many cases, although the vast majority of houses that were foreclosed on were not expensive houses. Today however the qualifications required for a jumbo mortgage are pretty stringent. 720 credit, 20% down minimum with some lenders requiring up to 40% down,

I don't think these are stringent terms. You're talking jumbo mortgages here. 20% is nothing, 720 is unimpressive and you can qualify for far less. IMO, almost anyone buying a million dollar home with 200k in liquid assets is a fool.

I can qualify for a million dollar home with my salary and assets; that doesn't mean I should buy one. The standards are incredibly lenient, even if they're a bit tougher than a few years back [[like they actually check to see if you're working).

And cash buying is so common because of fear of low home appraisals. The sellers don't want the deal to blow up when the appraisal comes in too low. This does not, however, lessen the risk of paying too much, nor does it remove the potential external costs borne by the taxpayer.

But the larger point is that the benefits to buying are isolated to the buyer, while the risks to buying are borne by society. This is why the public has a right to question this type of development.

[Detroitnerd]

We should be preserving open space and promoting infill, rather than subsidizing construction on virgin land, especially in a shrinking region.

I agree wholeheartedly, Bham1982.

Perhaps the first step to understanding why exurban development isn't the kind of growth we need is to demonstrate how heavily subsidized it is.

[Cincinnati_Kid]

Just a lot of happy talk designed to force up prices and garner Realtors some commissions.

This is true. They are hyping up the market to get people to take the plunge. I don't think people are busting down agents doors to buy a house. It's hyperbole. Banks still have a death grip on credit for approving loans. If your score isn't superalative [[750 score or higher), you ain't getting approved anyway.

[JVB]

We bought our house 2 years ago. I have all 3 credit scores just above 800 and I put 20% down and I still had a hard time getting approved. Things may have loosened up a little bit but I was shocked at how hard it was this time around. Our last house we bought in 2005 with lower credit scores and 0% down and they didn't bat an eye. No wonder the mortgage melt down was so bad.

[Hermod]

Nov 2, 2012: September 2012 housing data. In September, housing starts in the US achieved a four year high. Starts are currently 40% of what they were at the 2005-2006 peak and are at about 60% of the 50-year average, so there is plenty of room to grow.

Inventories of existing houses remain lean and sales are up. The elephant in the room is when the banks dump their foreclosure backlog into the housing inventory.

[p69rrh51]

Here is a McMansion of its day in an area that has been discussed. For those who are interested you could contact the realtor to find out what the maintainance fees are. What I worry about unlike, the burbs and large new homes, this home is affordable but still has the upkeep of the newer homes if not more due to its age. B-E and other similar areas have suffered from well meaning owners who get in WAY over their heads trying to keep up a large home such as this one. Thx to southofbloor for the headsup on this being listed.

http://www.realtor.com/realestateand...2_M41260-25492

[iheartthed]

Here is a McMansion of its day in an area that has been discussed. For those who are interested you could contact the realtor to find out what the maintainance fees are. What I worry about unlike, the burbs and large new homes, this home is affordable but still has the upkeep of the newer homes if not more due to its age. B-E and other similar areas have suffered from well meaning owners who get in WAY over their heads trying to keep up a large home such as this one. Thx to southofbloor for the headsup on this being listed.

http://www.realtor.com/realestateand...2_M41260-25492

If it weren't for municipalities in MI being allowed to subsidize McMansions in cornfields, that house in B-E might be worth more than a mid-sized luxury car. The only way that B-E house can be properly maintained is if someone has cash on hand to sink tens of thousands of dollars into it. Otherwise, that B-E house will likely not ever qualify for any type of bank financing to make significant repairs/updates/modifications.

[wolverine]

I wonder how much the value of "classic" Detroit homes has held up over the last seven years. What does it cost a year to heat and maintain those Boston Edison homes?

Here in Chicago, that's why so many beautiful vintage multi-family homes get bought, leveled and turned into some huge single family home that does its best to mimic what was there. For awhile that was stomped out by the recession. But now that has passed contractors are back to work building huge spec homes. I'm all for more wealthy families moving into the city, but we're losing our city's heritage.

While Detroit has also lost alot, I sense a stronger enthusiasm for preservation there.

[rb336]

Here is a McMansion of its day in an area that has been discussed. For those who are interested you could contact the realtor to find out what the maintainance fees are. What I worry about unlike, the burbs and large new homes, this home is affordable but still has the upkeep of the newer homes if not more due to its age. B-E and other similar areas have suffered from well meaning owners who get in WAY over their heads trying to keep up a large home such as this one. Thx to southofbloor for the headsup on this being listed.

http://www.realtor.com/realestateand...2_M41260-25492

I don't think the B-E homes qualify as "McMansions"

[Cincinnati_Kid]

If it weren't for municipalities in MI being allowed to subsidize McMansions in cornfields, that house in B-E might be worth more than a mid-sized luxury car. The only way that B-E house can be properly maintained is if someone has cash on hand to sink tens of thousands of dollars into it. Otherwise, that B-E house will likely not ever qualify for any type of bank financing to make significant repairs/updates/modifications.

Don't mean to sound naive, but why wouldn't it qualify? Because of the area it's located in?

[Cincinnati_Kid]

Here in Chicago, that's why so many beautiful vintage multi-family homes get bought, leveled and turned into some huge single family home that does its best to mimic what was there. For awhile that was stomped out by the recession. But now that has passed contractors are back to work building huge spec homes. I'm all for more wealthy families moving into the city, but we're losing our city's heritage.

While Detroit has also lost alot, I sense a stronger enthusiasm for preservation there.

Sounds similar to the "bigfoot" homes in Birmingham, that owners level and rebuild so they can tower over other homes. Since they can't build out due to small lot sizes, they build up.