Against the boom, via City Journal (by our own Bert Stratton):
“In Cleveland—and, I imagine, similar markets like St. Louis, Pittsburgh, Detroit, and Cincinnati—you can still find investments with decent cap rates. The boom hasn’t come and probably never will. Limited appreciation is the norm, as is solid cash flow. It’s not glamorous, but it works. I bought a Cleveland apartment building in 1987 and sold it this year. It appreciated 2 percent per year—less than the inflation rate. The building didn’t suddenly become situated in “Lincoln Park” or “Park Slope.” But I had cash flow.”
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From white flight to white infill:
“Whites once fled the inner cities to the suburbs, but now it’s the outer cities that whites abandon for the “excitement” of city life. I’m not saying that these white people came up with a devious plan to kick out the local black or Latino populations in cities. They just don’t notice when it happens, or they believe that the benefits of gentrification will “trickle down” to the poor. Their beliefs are even backed up by a few studies, using pre-2000 data, finding that gentrification doesn’t result in displacement. But in the years since 2000, that picture has changed.”
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Cleveland — cheap power, fiber-optic cable, and safe storage for your digital information:
“It’s ironic that a Rust Belt city like Cleveland, once a manufacturing giant brought to its knees by disruptive technologies and business models, is so well-suited to the Internet age. The superhighways of the 19th and early 20th centuries — rail lines — have proven to be the ideal conduit for routing fiber-optic cable, much like the telegraph lines of old. “It’s an infrastructure legacy,” said Kevin Goodman, managing director and a partner in BlueBridge Networks, which has a downtown data center near Playhouse Square and a larger facility in suburban Mayfield Heights.”
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U.S. News and World Report thinks Legacy Cities are hip:
“Long-suffering Buffalo, along with other Rust Belt cities hit with the double whammy of the New Economy and the Great Recession, is coming back. And local politicians and urban experts say these cities are in a historic renaissance that belies the late-20th-century presumption that industrial America was finished. Urban expert Alan Mallach calls them “Legacy Cities” – cities whose workers helped build this country that are now struggling their way back decades after the New Economy took hold.”
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Write A House in Detroit announces 10 finalists for their inaugural residency, the first step to fulfilling their mission to “enliven the literary arts of Detroit by renovating homes and giving them to authors, journalists, poets, aka writers.”
I have family that lives near Cleveland. I live in New Mexico and used to travel every summer to visit family in Ohio. I can remember the 1960s how dirty the city was. The city has truly done a lot to improve the city. Lots of great buildings and things to do. What a transformation.
The Albuquerque New Mexico real estate market is slowly improving with home prices increasing low single digits the last three years.
I purchased a few single family residential homes in 2011 and 2012. Positive cash flow and slow appreciation.
Inventory is declining and sales are increasing. Hoping this will cause prices to increase.