The Schizophrenic Market
Overall, I believe it is safe to say that the housing market is a mixed bag of opinion. On the one hand, sellers are staring at substantial losses in their home’s equity, if they purchased four or more years ago. On the other hand, buyers have been brainwashed by a daily barrage of media contending that real estate prices are low, mortgage rates are low and that there is a HUGE inventory of home just ripe for the purchasing.
While in some instances, all three of these conditions are true, they likely do not apply fully in our marketplace.
Huh?
National Housing Market
Nationally, the housing market looks a lot like a foggy day. When you wake up on a foggy day, all the sounds around you seem to be deadened, and far off. Yet, as the day progresses, light begins to get strongest on the horizon as the sun rises. The grey, damp blanket that descended on the city throughout the night is slowly burnt off as the sun gains altitude.
From the Financial Times, here is a report on the Homebuilders Association outlook for the housing market. Like a foggy day, it is bleak, with a few bright spots, namely the twelve marketplaces that are showing stronger housing numbers. Not too long ago, there were only a handful of markets bucking the negative housing trend.
Regional Housing Market
The metro Detroit housing market appears to be one of those brightening patches in the foggy morning. In early 2009 I wrote an article that called the Michigan real estate market the “canary in the coal mine” for the rest of the nation’s real estate market. Our state’s real estate market has been closely tied with the automotive industry. As the automotive industry stumbled and nearly collapsed, the state’s housing market followed suit. Now, the automotive industry has, roughly, stabilized and we are beginning to see signs of life in the housing market. Just review this article from the the Detroit News highlighting the local real estate board’s sales numbers.
Plymouth Housing Market
The Plymouth housing market could be considered one of the rare bright spots on that foggy day. We’ve been tracking the Plymouth housing market for some time now.
Looking at year-to-date sold homes in Plymouth, we’ve already seen a nearly 13% increase in the number of homes sold, compared to the same time last year. Interestingly, the sales price has fallen a little over 1%. It is my contention that this price decrease, as minimal as it is, is due to distressed (foreclosure & short sale) home sales.
If we compare 2009 year-to-date numbers to 2011, the numbers look even more promising: number of home sales is up over 14% and sales prices are up nearly 6.5%.
Crazy Train Anyone?
What are you seeing in this real estate market?
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