Foreign investors who have tried to buy distressed Detroit properties in hopes of turning them around for income are now reporting huge financial losses.
The Detroit Free Press reports that Danny Kwanten is one of potentially hundreds of Belgian investors who were drawn into Detroit's recent housing comeback, expecting 10 percent to 15 percent in annual returns renting out houses to city residents. But only after Kwanten plunged over $80,000 into two houses was he exposed to tenants who don't pay rent, costly house repairs and high property taxes.
Speculators have long attended the Wayne County annual tax auction to buy houses for cheap and resell them to unwary foreign investors.
Kwanten says he fell for the pitch that Detroit's housing recovery was moving so fast that investors should buy before it's too late.
