A recent article from Forbes.com reported Chinese investors were "buying up Detroit" because the prices were so low, just $39 for a house. Sight unseen, Detroit properties were being snatched up as China Central Television, the state broadcaster, reported that two houses in Detroit cost the same as a pair of leather shoes. The smartest thing the Chinese investors could do is walk right by those Detroit houses.
In the Forbes piece, Caroline Chen, who sells Detroit real estate, says, "I have people calling and saying, 'I'm serious -- I wanna buy 100, 200 properties. They say, 'We don't need to see them. Just pick the good ones.'" One doesn't have to see the houses to know that there are no "good ones" for $39. If there were, local investors would have purchased the houses long ago. For right around that $39, the Chinese buyer could invest in a share of Coca-Cola (KO), Suncor Energy (SU), U.S. Bancorp (USB) or Wells Fargo (WFC).
Source: The Street
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