Even before the financial crisis, Detroit was known for its undervalued real estate. Now, a bad situation is even worse.
Michael Bradley and his sister Annette Foreman have spent the last several months cleaning their mother's home. She died on Christmas Eve last year, and they're putting her house up for sale.
The four-story house, known as Stone Hedge, was originally built for Walter O. Briggs in 1915. Briggs was in the car business. His company built auto bodies, and he owned the Detroit Tigers.
Stone Hedge is large, about 10,000 square feet. There's a room just for linens and a two-part kitchen. There's an elevator, a solarium and a cold closet for fur coats.
Bradley and Foreman's parents were active antique collectors, too. They filled their home with collectibles and they enjoyed entertaining in their ballroom.
The late Joseph and Gloria Bradley bought the house 1976 for about $65,000. It sits in Boston Edison, a neighborhood that attracts Detroit's richest and most important people. Motown mogul Berry Gordy and automaker Henry Ford both called the neighborhood home. With its tree-lined streets and its Tudor Revival mansions, it looks like it could be any wealthy neighborhood — another Greenwich, Conn., or Beverly Hills.
A comparable house in Silicon Valley is selling for $15 million. Yet the Bradley's home, with its stained-glass windows, servants' quarters, coach house — all on one of Detroit's most historic streets, runs for less than $450,000.
Sometimes in Detroit, housing prices don't seem to make much sense at all. The median Detroit home price in 2011 was about $54,000 — more than $100,000 less than the rest of the country.
Walter Maloney, with National Association of Realtors, says the Bradley family is facing the same problems that millions of Americans are.
"This is perhaps an extreme example of a home being worth really a mere fraction of what it would cost you to build that property," he says. "In fact, in most of the country today, we are seeing homes selling for less than replacement construction costs. This is really an over-correction of the housing boom and bust cycle."
In 2000, the Bradley family had their home appraised, and at the time, it was worth $1.5 million. The question for them is, why sell now?
Bradley and his siblings are all underwater on their own homes. "We have homes of our own that we can't get rid of because of their upside-downness and ... I'll be quite honest, this is not a cheap house to run, utility-wise," Bradley says.
For Foreman, there's much more at stake than the price tag.
"I'm going to miss it from the historical point of view. To have something that is a living antique," she says. "I'm going to miss baking in the kitchen with my mother. My mother and I, for the holidays, would start baking in October. This was a part of my mom."
Foreman and her brother say they're looking for someone who wants to take care of the home. They don't just want a buyer who's looking for a sweet deal. They say they've already turned those people away.
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