We don't live in Detroit but bought 3 properties for 40k each with about 18-20% yields. The renters aren't the best (they're paying 800 in rent because they can't afford an 8k downpayment), but they're great investments.
There's a reason why the value op the property, including home and land, cratered to $500 or a few thousand dollars. It's the state of the neighborhood that dictates the value and it can change rapidly, faster than in regular neighborhoods.
It's not an investment I would recommended for inexperienced investors or people with limited savings who put all eggs in one basket. And sadly, the low prices attract quite a few of them.
When I suggest real estate investing of any kind, I usually hear a wall of objections about risks, and a lack of interest in how to counter those risks. It's part of the reason I like it.
(Not that I'd invest in Detroit, I don't have a rationale for it. Some people do)
Here's a good example how a lot of the $1,000 homes, and the surrounding neighborhoods, really look like: https://youtu.be/IuJFLJ0JApA . In the description there's a link to a follow-up video 3 years later. It's not a pretty picture. But then again, who buys properties on auctions without inspecting them first?
It seemed there were some distressed properties and that some work was done on them... which tells me nothing. Were the houses rehabilitated, is work still in progress or were they ultimately re-abandoned? Can any conclusions whatsoever be drawn from this?
It's definitely sympathetic to the plight of the very low income tenants but not unjustly so; anyway I found it fascinating and worth recommending here: