In Detroit, where boarded-up homes plague one block after another, buying up foreclosed or distressed property has grown into a cottage industry.
One-third of the homes listed for sale in Detroit are bank-owned foreclosures, according to Realcomp Inc., a firm that tracks real estate transactions in southeast Michigan.
Roughly 80 percent of houses sold in the city are being bought by investors, some of whom are coming from as far away as Hong Kong and Hawaii in a bid to make their fortune buying foreclosed homes in bulk, according to Realcomp.
These houses are especially attractive to foreign investors, in part, because the weak dollar makes American real estate a bargain for investors paying with euros or yen.
Jeremy Burgess caters to the new breed of eager real estate prospectors who are snapping up homes at absurdly low prices. His company, Urban Detroit Wholesalers , helps clients identify promising neighborhoods to purchase homes to renovate and then rent or resell.
In business since 2007, Burgess and his partner started out by buying foreclosed houses, fixing them up and then selling for a profit. Many homes are sold to investors for around $38,000 after they have been renovated, Burgess says. These days, he's doing a brisk business.
"Right now, we have more people to buy houses than houses," says the 29-year-old from Washington state. He estimates that prices in metro Detroit - mainly within the city limits and nearby suburbs - are so low that investors from more expensive markets like California and Nevada feel they can grab bargains.
"Detroit used to be kind of a secret for real estate investing," he says. "It's becoming less and less of a secret now."
Of course, property experts warn that it could take years before the real estate market in Detroit rebounds. The city has one of the highest crime rates in the country, with gun violence seeping into almost every area of the Motor City. The school system is a shambles and the employment outlook isn't any brighter.
The automotive industry, long an employment engine for Detroit, has been hammered by losses and job cuts. Detroit-Warren-Livonia, Mich., had the highest unemployment rate of any large metro area in September, at over 17 percent, according to the Bureau of Labor Statistics.
"It could realistically take years before we see the city return to something reflecting growth," adds real estate economist Lew Goodkin, who says many of the so-called bargain homes for sale will need lots of work. "Investors hoping for a quick recovery may be disappointed."