The Great Recession of 2007-2009 battered Detroit, perhaps more than any other U.S. city. Of the Big Three automakers – Ford Motor Company (NYSE: F), Chrysler and General Motors Company (NYSE: GM), which had provided the foundation of the city's employment base for decades – only Ford emerged from the crisis without requiring government intervention to remain afloat. Thousands of jobs disappeared amid the malaise. The city's unemployment rate exceeded 25% for a time in 2009. As of March 2016, Detroit still claimed one of the nation's highest unemployment rates at 11%.

With residents fleeing the city by the thousands in search of better economic opportunities, Detroit's real estate market has suffered. The median home value in the city, which stood at $62,800 in 2000, fell below $30,000 during the depths of the crisis. In Detroit's most blighted areas, houses went on the market for as little as $1 – and still went months with nary an offer.

Market Insights

Still reeling from the Great Recession, the median home sales price in Detroit was $32,000 in June 2011. Prices slowly began to come off their lows the following summer. As of May 2016, however, appreciation in Detroit has been minimal, with prices still well below where they stood during the 1990s and early 2000s. In April 2016, the median Detroit sales price was $39,900.

Over the five-year period studied, price and sales volume fluctuations throughout the year have been seemingly random, not coinciding with seasonal changes. This stands in contrast to many cold-weather U.S. cities, which experience increases in home sales and median prices during the summer months. In Detroit, the highest prices seen between 2011 and 2016 were in December 2015, when the median sales price reached $45,000.

Sales volume, while fluctuating wildly from month to month during some years, is low in Detroit. The most homes sold in the city during any one-month period from 2011 to 2016 was in October 2015, when Detroit had 380 home sales. For comparison, Phoenix had over 5,000 home sales during the same month.

Property and Transfer Taxes

Wayne County and the city of Detroit have some of the highest property tax rates in the United States. Because of the area's low home values, however, tax bills often are still very low in terms of dollar amount. For tax purposes, homes in Detroit are assessed at 50% of their market values. Homeowners pay city, county, state, education and community college taxes, all of which are calculated in mills. A mill equals $1 per $1,000 in tax-assessed value. The net millage rate for a Detroit home is 84.5.

A Detroit home with a market value of $50,000 – which is actually higher than the city's median – has a tax-assessed value of $25,000. Given a net millage rate of 84.5, the homeowner's annual property tax bill comes to $2,112.50.

Transfer taxes in Michigan include a state tax of $3.75 per $500 in real estate transferred and a county tax of 55 cents per $500. For counties with populations over 2 million, the rate is 75 cents per $500. As of 2016, no county in Michigan exceeds 2 million in population.

Most Expensive Neighborhoods

Detroit may be known for poverty and blight, but interspersed in its vast swaths of urban decay are several exclusive neighborhoods that are home to the city's elite. Many of these neighborhoods sit only a few miles from the city's slowly revitalizing downtown. Indian Village and Sherwood Forest feature large homes constructed during the 1920s and earlier, all situated on spacious lots with mature trees. Both neighborhoods provide access to greenery and the city's park system, offering convenience to downtown and the University district.

Upscale Detroit suburbs include Birmingham, Wolverine Lake and the aptly named Beverly Hills. All are in Oakland County, which, in stark contrast to the population loss of Detroit proper, has been adding residents throughout the 21st century.

Top Real Estate Websites

Perhaps because the city's real estate market lacks vibrancy, Detroit has fewer local real estate websites than other large cities. Several national real estate companies maintain strong presences in Detroit, including websites managed by local teams of agents in the city. Remax-Detroit.com is one such site, operated by local agents and featuring an extensive home search feature.

Otherwise, homebuyers can utilize sites such as Trulia, Zillow and Realtor.com, all of which provide access to Detroit MLS listings as well as information about broader real estate market trends in the area.

Indianapolis Real Estate Market

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