I saw a piece in Yahoo News about this and I wanted to pass it along. I get at least a couple of calls every month from out of state folks asking about these.

The article does a good job in explaining just why a $500 house isn’t the bargain that people think it is. Here it is…

Tempted by Detroit’s $500 Properties? 5 Things to Know

By Beth j. Harpaz, Associated Press – March 11, 2015 4:45 PM

DETROIT (AP) — Sixty-two thousand properties have faced foreclosure in Detroit this year over unpaid taxes. About half will likely be auctioned for $500 apiece this fall.

Buying homes or vacant lots for $500 might sound inviting, even in a city as troubled as Detroit. After all, look at New York: Decades of crime and decay gave way to a real estate boom that has gentrified even outlying working-class neighborhoods. Properties that sold for thousands in the bad old days are now worth millions.

But there are no guarantees. “The opportunities are there but there are huge challenges,” said Dang Duong, a law and business student at the University of Michigan who has bought and renovated several dilapidated homes in Detroit. “If you’re under the impression you can buy a property for $500 and wait a few years until Detroit has recovered, that’s going to be difficult.”

Here are five things to consider before buying property in Detroit.

1. THE HOUSE MAY BE OCCUPIED

Are you prepared to evict former owners, longtime tenants or even squatters? Loveland Technologies, a mapping company that has surveyed every property in Detroit, estimates that half the properties facing foreclosure are occupied, housing about 100,000 Detroiters.

Critics question the morality of buying occupied homes and fear the program may increase Detroit’s homeless population. They say many owners stopped paying taxes because they weren’t getting city services in return. Others say those who failed to pay taxes contributed to Detroit’s troubles.

Starting with my first Franklin Planner in 1995, I have been engaged in a seemingly endless quest to develop the perfect productivity and organizational system.

The Franklin system was truly spectacular. I was working in Silicon Valley at the time, and taking the introductory class from a real FP trainer was required after you got hired. It didn’t take long to see why. The class was two full days long, and it laid out a simple and elegant paper-based methodology for organizing and tracking everything in your life – from appointments to tasks to random thoughts and ideas.

I used it religiously. Right up to the point when I bought my first Palm device in 1999. With it I was able to sync my calendar with the device, and that made the entire calendar function in the FP redundant and ultimately unnecessary.

Then I found GTD – David Allen’s methodology, which had a huge impact on my productivity, and I started using various paper-based and electronic methods of tracking notes, tasks, and projects.

None of which worked particularly well. I even used the GTD add-in for Outlook. It was good but not great.

I found a great article by Denis Kleinfeld on the Moneynews.com website that talked about real estate as an investment vehicle and I wanted to pass it along.

Here’s the piece:

I know that many people are unhappy with the way their money managers have been handling their investment portfolio. This becomes readily apparent to me every time I sit in one of those meetings between the client and their investment advisers.

The meeting pattern is so predictable. First, the review of the current portfolio holdings explaining that while they didn’t meet the benchmarks, the portfolio did better than others did. The implication being that it was a good thing that they were handling the investments otherwise the client would have lost more money with the other guys.

Second, the presentation of the predicted investment climate for the next month or quarter is made. All sorts of glossily printed charts and graphs based on something called data tell the future in mathematical terms. The chief economist of the firm has pronounced what will happen and the client is expected to dutifully be in awe of his brilliance.

You would think that listening to these guys that the world of investment consists of primarily stock and bonds and something called alternative investments.

I have the impression that they lump everything they actually know little about into the alternative investment category.