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Home Prices Drop - to $1


Though 30-year mortgages may still be available.

The bottom continues to fall out of the housing market.

Phoenix reports a decline of 32.7% for the year; Las Vegas, 31.7%; San Francisco, 31.0%; Miami, 29%; Los Angeles, 27.9%. And San Diego saw an annual decline of 26.7%.

It was the largest year-over-year median-home-price drop since the National Association of Realtors started keeping records in 1968.

Economist Peter Dawson told Bloomberg not to expect things to change too soon. A bottom in housing prices is "not likely to occur in 2009," he said. "The best we can hope for is an early 2010 bottom."

Perhaps former Merrill Lynch executive Peter Kraus -- who received a $25 million severance package after 3 months at the firm -- should have waited. Kraus just bought a $37 million 5-bedroom co-op at 720 Park Avenue, according to the New York Post.

It has 11-foot-high ceilings, 3 fireplaces, 3 maid's rooms, a library, a gallery and a family room/gym.

Had Kraus waited until next year, he may have been able to save 2 or 4 or 7 million dollars. Or so.

Some are feeling the pinch a bit more. Michael Waldorf, a senior vice president at the hedge fund Paulson & Co., recently closed on an apartment in lower Manhattan's Battery Park City. Waldorf paid a paltry $6.175 million for a 28th-floor residence. That's more than $30 million less than Peter Kraus paid. Waldorf practically made money on the deal!

But, believe it or not, there are even better finds out there. Just don't plan on living in Manhattan.

Music lovers will feel right at home in Detroit, birthplace of the White Stripes, the Von Bondies, the legendary MC5, and Eminem.

Got a spare buck lying around? You're in luck.

8111 Traverse Street was foreclosed upon after it was purchased for $65,000 in 2006, according to an article in the Detroit News. The bank, desperate to sell the home, was so eager to sell, it lowered the price to $1 in a Hail-Mary attempt to find a buyer.

Nineteen days later, someone bought the place at full list price -- in cash, at that -- as "an investment property." Fobbing off the plywood covering the windows and doors to a scrapyard would likely net more than a buck. There's your ROI right there.

Don't worry if you missed out on 8111 Traverse -- a quick search on turned up a few more 1-dollar homes in the Detroit area. So what if the city has an unemployment rate of 21%? It's not quite as bad as Haiti, where about 60% of the population is unemployed. - though it is 3 times that of Paraguay, where unemployment is pegged at around 7% by the CIA World Factbook.

Collect 20 empty soda cans, and you've just become a homeowner.

Prefer the cool microclimate of the Pacific Northwest to the tense powderkeg that is central Detroit? You'll have to spend a bit more (10 times more, actually) but -- as they say in the trade -- "Location, location, location."

Ten bucks for almost 1100 square feet. Go ahead - put 30% down. Your initial outlay is still less than the price of a Big Mac.

If you think you'll have trouble paying off the remaining $7 over the course of a 30-year mortgage - well, you shouldn't be buying.

You should be renting.
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