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Real Estate News

June 6, 2012

Scripps Mansion Tells Detroit’s Depressed Real Estate Tale

(Continued)

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With 6 bedrooms and 5 bathrooms, the property needs work but has the grand space that would make it a worthy rehab project, given the library, family room and large entertainment hall. Who knows, maybe restoring this home would coincide with a Motor City comeback - although O'Connor offers a bleak forecast for Detroit's fiscal recovery, especially the real estate market.

  • Detroit values are in a free fall. While other major cities in the U.S. have seen home values decline, all of them except Detroit remained above at or above their 2000 values even during the depths of the Great Recession.
  • In Metro Detroit, however, values dropped down to levels not seen - on average - since the 1980s. The city also has been hit by an ongoing financial crisis in the schools, cutbacks in city services, very high insurance rates (due to crime and fraud) and a virtual exodus of the middle class. A city that was home to nearly 2 million people in the 1960s is now down to 700,000 residents - but still faces keeping up the same infrastructure with a far lower tax base.
  • Investors have scooped up scores of foreclosed homes in Detroit for cash, some selling for just a few thousand. Real estate experts say they assume one-fifth or so of the properties will be uninhabitable, but that the rest can be inexpensively fixed up and rented, while the investors wait for values to rise. We've had organized bus tours of Chinese investors come through town, for example.
  • Right now, the city is on the verge of bankruptcy, while the state tries to negotiate an emergency financial manager who can come in and cut budgets, tear up union contracts and restructure or privatize services.

James Scripps original home on Trumbull Ave., now burned down.

Other Scripps properties

Meanwhile, James Scripps' original mansion at Trumbull Ave. and Grand River Ave. burned down, leaving only a gated entrance. Among other public buildings left by James Scripps is the Detroit Institute of Art.

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