by Marc Phillippe Babineau

Created on: March 24, 2009   Last Updated: April 24, 2009

Just how low can housing prices go, and when will they turn around. If anyone had those answers, they would be the next Warren Buffet or Donald Trump in waiting. When considering housing prices and how low they can go, you must also consider location. A foreclosed $1 Million USD home if Hoboken, New Jersey will sell for a lot less than the exact same house located on the waterfront in Los Angeles.

At the moment, you can buy a freestanding, single-family home for under $10,000 in many cities in many States? Foreclosed houses in rural Detroit, Michigan, can now be purchased with a credit card. It used to be that people would live in their cars when they could not afford a roof over their head. But now, in Detroit, you can live in a single home if your car gets stolen or towed away, since many houses are cheaper than new cars.

A real estate company in Detroit by the name of Urban Detroit Wholesalers advertises the fact that they take credit cards. The scheme may seem too good to be true for many people, however, they will be paying full interest on the full amount of the final purchase price, after all taxes and fees have been added to the selling price. At 18% to 29% annual interest rates, a $20,000 home may come with a $1,000 per month minimum payment, which barely touches the capital.

The down side, however, could be the neighbourhood that you are buying into; when buying houses at rock-bottom prices, and with the fact that unemployment is at record levels, squatters may be your neighbours, as many homeless people are now taking residence in boarded up houses. Small stores close almost daily, and the big-box stores have boxed-up and left. Homes that just 5 years ago would fetch over $150,000 can be purchased with a credit card carrying a $20,000 to as low as a $7,000 line of credit.

Liquor and lottery sales are up, and the city is thinking about building a casino to generate revenue. Great idea, put a casino in the one city in the USA that is facing bankruptcy. Hire the few people who don't have criminal records, and who is left to play besides tourists, politicians and successful drug dealers? Has Detroit really gotten this bad?

In a word, yes. Detroit has lost half of it's population in the past 50 years, with manufacturers, business and stores closing, bailing out before the losses piled up too high. The most profitable stores are corner stores, casinos and liquor stores, which does not paint a rosy picture for the hopes that the citizens have in their futures.

But,

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