Demolishing dilapidated properties and building from the ground up can be cheaper than rehabbing. But some buyers choose renovation to save historic architectural details found in much of Detroit’s early 20th-century housing stock: turrets, gingerbread trim, pillars and antique woodwork amid broken windows and sagging rooftops.
But beware of hidden costs and scams. Properties may come with liens, water bills and back taxes totalling thousands of dollars, in addition to renovation costs. It’s also not unusual to hear of homes sold to buyers in other states and countries, with purchase prices rising with every flip. Check with your accountant or tax lawyer; a Canadian purchase and sale might bring taxes that would cut in to any profit.