Michigan Market Update - September 2011 September pending sales fell somewhat from August but still finished ahead of last September. For Southeast Michigan, we have had four consecutive months of a rising average price per square foot. That can be explained by a combination of fewer lower priced bank sales and good old fashion appreciation. How much of each is tough to tell, but certainly there is at least some sprinkling of appreciation in the mix. Bank owned values have bounced around a bit while non-bank values have moved steadily upward in the past three months. Average Price per Square Foot and Median values tend to follow the same trends so looking at both can help confirm a market direction. Another exciting opportunity is the strength of our single-family home rental market. While home values were declining, rental rates and demand for rental homes remained firm (as an unfortunate result of so many home owners now forced to be renters). So investors can now get reasonable cash on cash returns when in the past they were lucky to just cover their costs (our web sites have an investment analysis button on each listing). The other side of that coin is that Metro Detroit is one of the strongest markets to own in lieu of renting. The chart below shows an extreme example of the power of owning vs. renting. In the example, because the Buyer saves $350 per month over renting, they can actually lose money on the home (in this case the home falls in value over 20%) and still make a great return on their investment (down payment plus loss on sale)! So as a renter/buyer, if you have any interest in being a homeowner in the next five years, go after it now, there will be not better time to do it! For Company news: Trulia has just released a report showing that 69% of the errors in on line listing postings (price, status, etc.) come from third party syndicates (like Point2, List Hub, etc.). What does that mean to our Sellers and us? Most all brokers use these services to send their listings to various sites, so they are more prone to errors. We distribute directly whenever possible to ensure that our listing information on the web is accurate. So even if another broker says they send their information to some of the same web sites as we do, our information is the most accurate and up to date. Thank you
If you would like expert advise and representation in your next move, please contact me.
Suzanne O'Brien
(313) 516-6644
suzanneo@realestateone.com
