Here is what is going on in the Southeastern Michigan real estate market. Our market for the last 2 years was a sellers market. It was a strong market, Metro Detroit homes were appreciating steadily upward. Last year many home values across our market went up 15% or more. It was a good market even through our harsh winter last year. Our normal selling season of May through July was good. Then we took a turn.
What I noticed is that some cities were still strong. In other cities the homes that were over priced and in need of work they sat. Southeastern Michigan home buyers are still leaning towards homes that are updated and move in ready. They will overpay for a home like that and pass over a home that needs work. I think there are two reasons why this is happening . First I believe today's younger buyers do not have the time or the money to do the upgrades and repairs. I think some of todays buyers want an updated home because it is a reflection of who they are. Even if they buy a great deal that needs work it does not give the same "status" that an updated and move-in ready home has.
The second reason is that the younger buyers do not have the skill set to do the work. As kids we worked our way through high school. Todays kids usually do not work at the type of jobs we did because we just give them the money to do what they want. So they never got hands on experience doing odd jobs. That is just two reasons why I believe today's home buyers like updated homes.
Since the end of July our market has turned soft. We are seeing drastic reductions in price. Homes that started off too high in hopes that there would be that one buyer that would purchase the home at that high price are now reducing their prices to get the home sold. I am getting emails daily telling me about price reductions or buyer's bonuses.
We are seeing a rise in inventory, and a slowing of home sales in Metro Detroit. It is no longer a seller's market in most cities. Yes there are still a few cities that are still selling homes quickly. It is still the move in ready updated homes that are selling the best. So if you are a seller you need to have your home priced right or you will be sitting on your home. If you are Michigan home buyer you now have the room to negotiate. It has almost become a buyers market.
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