Michigan Housing Markets Ready to Rebound?!

By
Real Estate Agent with Coldwell Banker Schmidt Realtors

Traverse City, Michigan?! Most have not heard of the local market that I do my business in and live. We have began to get some media coverage as consistently being a top destination for those in the retirement mode. With low median housing costs and a great upside with regard to qulity of life, Northwest Michigan has been largely unaffected by the housing crisis that has plagued most of the rest of the state and the nation. Truth be told, we are seeing about a 25% home value correction from the boom of 2003-2006. Some of our rural areas have seen a correction of about 40% in value from the same market. These numbers still have to be much lower than states like California, Florida, and Nevada that have seen much largrer corrections in their markets.

On the other hand, most of Michigan is not as fortunate as we are in our resort town. Former boomtowns like Detroit, Lansing, Warren, Grand Rapids, Kalamazoo, and Flint have faced catastrophic levels of decrease when it comes to home values. Increased forclosure and unemployment rates have haulted many markets. For many in Michigan the past few years have been a "perfect storm" of negative economic data, bank failures, job loss, increasing energy costs, and insufficient healthcare coverage... not a pretty picture.

Now the good news about the rest of Michigan. According to folks at MSN.com and USNews.com, Lansing and Warren have made it on to their list of "10 Hard Hit Housing Markets Ready to Rebound". They say that Lansing, the State Capital, has faced a drop of 28% in value from peak through the 1Q of 2009. They are projecting that values will rise by 15% by 1Q 2014. Warren, MI is the 3rd largest city in the state behind Detroit and Grand Rapids. Prices in Warren have dipped 37% from their peak through Q1 2009. The projections for Warren are an increase of 21% through Q1 of 2014. Then there's Detroit... what to say there. You can buy a house for less than the price of a car in the Motor City. The upshot here is that prices cannot go below construction value and in a market that has lost 72% in value since 2000, Detroit has had an increase of 1.9% in last month according to S&P Home Price Composite Index. Houston, we have reached the bottom of the bottom and we're ready for liftoff!

Has the New Homebuyer Tax Credit helped this... Yes. Will extending the Tax Credit to 2010 continue to help... Yes. Is the DJI being above 10,000 helping... Yes. How are these factors affecting you local market that most of us has never heard of? What are you doing to stimulate business to take advantage of some good news? We'd love to hear about other local markets ready to rebound!

Steven Terry- Mark Hagan and Associates

Your Nothern Michigan Real Estate Experts

Comments (0)