In 2021, Detroit renovators Keith Bynum and Evan Thomas bought an abandoned house for $1,000, gave it a Palm Springs-inspired makeover and sold it for $81,000; the reported profit was about $35,000

Compared to most American cities, Detroit has more vacant homes. Due to years of population decline, unpaid property taxes, and foreclosures, the city and its land bank now own thousands of empty homes, many of which are on blocks where neighbours still reside and take pride in their neighbourhood. That presents an opportunity for buyers willing to take on extensive repairs. The renovation approach later became the basis of a business and the HGTV series Bargain Block, after Keith Bynum and Evan Thomas moved from Colorado to Detroit in 2017.HGTV's Bargain Block premiered on April 14, 2021, following Keith Bynum and Evan Thomas as they renovated vacant Detroit houses into furnished starter homes. The Palm House featured in the second episode, titled Dormer and Palm, which aired on April 21, 2021. The pair bought the Palm House for $1,000, set a renovation budget of about $45,000 and sold it for $81,000. MEAWW reported an estimated profit of $35,000 on this property, although that figure was not an independently audited accounting of all costs.The Palm House's designMEAWW reported that the Palm House was in better shape than many of the pair's other projects, allowing them to set a renovation budget of about $45,000. Bynum gave the home a bright, palm-themed design intended to evoke a vacation getaway. The look combined tropical accents, colourful details and secondhand furnishings rather than reproducing Palm Springs' desert architecture literally. Bynum often gives each property a distinct theme and incorporates thrifted objects and his own artwork into the design. A clear theme also helps at the point of sale. It's a smart way to stand out in a price category when a lot of properties look the same, and buyers comparing a $79,000 listing with other restored homes nearby will recall the one that felt like a home.How $1,000 homes are createdThe Detroit Land Bank Authority's Own It Now program offers eligible vacant properties with a minimum offer of $1,000. The homes are sold as-is, and buyers are required to renovate them and ensure they are occupied, according to the City of Detroit's description of the program. The Palm House's reported purchase price was also $1,000, but the program rules alone do not establish that this particular property was sold through Own It Now. A low purchase price does not mean a home is ready to live in; the buyer must account for the repairs required.The pair were drawn to the contrast between Detroit and its suburbs. Evan Thomas told Seen magazine that houses selling for roughly $200,000 in Ferndale could be available for far less in Detroit. By May 2022, Pride Source reported that Bynum and Thomas had renovated nearly 30 homes. Their budgets varied by property. In a feature published by HGTV, Bynum said they typically spent about $45,000 on a house.How the profit built upMEAWW reported that the Palm House was listed for $79,000 and sold for $81,000, or $2,000 above asking. The outlet estimated its profit at about $35,000 after accounting for the $1,000 purchase price and the $45,000 renovation budget. It separately reported that the Dormer House sold for $99,000, with an estimated profit of $25,000. These are outlet-reported estimates rather than independently verified financial accounts. Actual profit could differ after closing costs, property taxes, insurance, utilities, maintenance and the owners' labour are considered. Any TV flip comes with a word of caution. A genuine profit also has to factor into closing costs, property taxes, insurance, utilities and the hours the owners put in working, so these numbers are a rough guide rather than a definitive accounting.The pair's approach was to buy vacant houses at low prices, renovate them within set budgets and resell them at prices intended to remain accessible to first time buyers. In a 2022 announcement, Warner Bros. Discovery said the first season of Bargain Block attracted more than 20 million viewers, suggesting strong audience interest in the show.The Palm House illustrates how a low purchase price can be followed by substantial renovation costs. The reported profit estimate depends on the purchase price and renovation budget, but it does not provide a complete account of every expense. The Detroit Land Bank's sales programs also require buyers to rehabilitate properties bought through them, so a low initial price is only the beginning of the investment.You use AI every day. Now get your AI Quotient. Take the AIQ test.