A Market Snapshot for Southeast Michigan

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Through the first half of the year, sales are up a little over 3%.
Average sales prices are up a little over 6%. The interesting thing
is that inventory is down 19%. The fact that sales and prices
are up by small margins is a large indicator that this crazy
seller’s market that we’ve been in the last couple of years is
probably coming to an end.

Looking at the Michigan housing affordability index, our index
currently sits at 180. To provide some context, an index of 100
means that the median family can afford the median home. An index
of 80 means that the median family can’t afford to purchase this
same home.

Historically, Michigan’s number has stayed level at around 135. At
the peak of our recession, our number reached 210. As we trickle
down toward the 130 to 140 mark, what it’s going to take to get
level again is interest rates in the low-to-mid 5% range and
housing values to potentially increase another 10% or
so. 


"This gravy train sellers have been on is 


likely coming to an end."

Another interesting point is that 89% of homes in Michigan have
positive equity, and 72% have 20% equity or more.

We may have one more spring like we’ve had with competing offers
and low inventory, but by and large I think this gravy train
sellers have been on for the past three or four years is ending
soon.

If you’re thinking about selling and aren’t sure whether it’s a
good idea to pull the trigger now or to wait until next spring,
give us a call and we’d be glad to help walk you through it. Until
next time, make it a great day.