Carpe Diem claims the average sales price of a Detroit home fell to $13,638 in January.
I had trouble believing that so I checked out a Detroit MLS site. Go here to browse 88 pages of homes listed for $20,000 or less. Included is this stately mansion for $19,900 and this 6-bedroom Victorian for $18,500. This This quaint three-bedroom, one-bath is listed for $1 under $2 per square foot. Imagine the disamenity of a city that cannot entice new residents even with a (practically) free house. The market-clearing price for much of Detroit's housing stock is probably negative, but the price obviously won't go that low and the market won't clear.
(Is there an arbitrage opportunity here? How much would it cost to move these houses to, say, Chicago or Milwaukee?)
If you want a visceral sense of the loss, see this photo gallery, "The ruins of Detroit."
