The average price of a home in Detroit is $15,000!
January 12, 2010
Given the Big Three’s difficulties it’s not surprising that Detroit is ailing, but the extent of the pain is incredible:
• The population has shrunk from 2 million in 1950 to less than 1 million today
• The average price of a house has shrunk from $98,000 in 2003 to $15,000 in October 2009
• The unemployment rate is 28% and the city faces a $300 million budget deficit
The end may not be nigh – other cities which have faced similar challenges such as Berlin (Germany) are starting to thrive again as extremely low living costs have attracted students and an art community which have given the city a cool edge. There are embryonic signs of a similar revival in Detroit but with 800,000 people spread over 140 square miles served by a city with a shrinking tax base and little viable industry (and no federal government like Berlin to soften the blow), the city faces long odds.
With little to lose, the city is becoming a laboratory. I hope the American entrepreneurial spirit unleashed by opportunity will stem and reverse the decline!