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Where in the US can you buy a home for less than the price of a new car? You’re probably thinking somewhere in Montana or South Dakota, or perhaps the Delta region of Mississippi, which has historically been one of the poorest regions in the nation. You might be right (though it should be noted, Mississippi is doing a little better these days, with the recent announcement of yet another auto plant coming to the state.)
Think Detroit, which was once the hub of the nation’s manufacturing sector, the place where auto workers could earn enough to not only afford a home, but also a small lake house and enough to send their kids to college. As this article from Reuters points out, it’s fairly easy to find a home in Detroit that sells for less than the $29,000 that is now the average cost of a car. According to Reuters, some homes coming up for auction are going for as little as a quarter of the original listed price. And we’re not only talking about matchbox-sized houses in struggling neighborhoods. One real estate expert notes that a three-bedroom home in Bloomfield Hills went for $130,000 — nearly $400,000 less than it was listed for.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.