Archive for the 'Michigan Articles' Category

The decline in Detroit home auctions for sale in April improved house prices, as buyers competed to purchase the remaining best-priced properties and beat the federal tax credit deadline.

The price median for homes in Detroit shot up to $9,000, a spike of 50 percent from the April 2009 median of $6,000. The price increase throughout Wayne County, where Detroit is situated, was even higher at 105 percent. The county median jumped up from $18,000 to $36,900.

The decline in foreclosure houses at auction also affected price levels in adjacent counties. The median price in Oakland increased in April by 30 percent from $84,500 to $110,000 and the median in Macomb climbed up by 29 percent from $59,000 to $76,000.

With more buyers beating the tax credit deadline, the number of pending contracts in the three counties increased to 6,883 signed agreements, a jump of 5 percent from the 6,575 pending contracts during the same month last year. Closed sales meanwhile dropped by 4 percent from 4,588 units in April 2009 to 4,422 units in April this year.

The surge in April home prices was a complete reversal of price drops in the Detroit area in March. The still high number of Detroit home auctions for sale dragged down home price levels in March to a total of 47 percent from the peak levels in 2005.

In March, home prices dropped to an average of $87,300 in the counties of Wayne, Macomb and Oakland. In the Detroit area, prices fell by nearly 19 percent during the month and more than 28 percent of total house sales were made to buyers who received huge discounts.

In contrast to the decline in Detroit home auctions for sale in April, the number of home auctions for sale in Michigan jumped up by 9.4 percent from 5,715 units in March to 6,252 in April. Total filings statewide also increased by more than 8 percent from 17,700 to 19,173 postings over the month.

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Despite the continued increase in Detroit foreclosure auctions, high rate of unemployment and image problems, a big portion of Detroit residents still love living in the city.

A survey conducted by Intellitrends showed that 50 percent of residents of Detroit and other areas of Southeast Michigan love living where they are and 91 percent of them believe that Southeast Michigan has been portrayed negatively by media practitioners.

Additionally, 51 percent of people who have moved to Detroit said they found what they were looking for and that their expectations were met. A whopping 31 percent even said that what they are experiencing as new residents exceeded their expectations.

With these positive feelings about Detroit, investors planning to buy properties through auctions for sale in the city and then resell them at a profit in a few years would likely achieve their investment goals as there are a lot of people still believing in the ultimate recovery of Detroit.

In the third quarter, the number of residential properties that were repossessed through Detroit foreclosure auctions and properties notified of pre-foreclosures increased year-over-year by 48 percent to a total of 13,192 units.

Similarly, the number of properties taken back by lenders through public home auctions in Michigan and properties notified of pre-foreclosures in the first quarter increased by nearly 11 percent to 45,732 units. Of these units, a total of 18,604 units became bank owned homes.

Foreclosure activity in Michigan continued to surge as job losses forced homeowners to default on their mortgage loans. State and federal foreclosure prevention programs failed to save a huge portion of these borrowers.

In March, the unemployment rate in the Detroit area increased to 15.5 percent, up by two percentage points from the February rate of 15.3 percent and up by 1.2 percentage points from the March 2009 rate of 14.3 percent.

According to the Michigan Department of Energy, Labor and Economic Growth, jobless rates increased in all the 17 major labor markets in Michigan.

As these news items about high unemployment rates and high foreclosure rates dominate news about Detroit and Michigan, survey respondents living outside Michigan are still associating Detroit and Southeast Michigan with the auto industry and music. On the negative side, a big portion of respondents also associated the area to issues like crime.

On the whole, real estate investors and home buyers planning to profit from properties listed for Detroit foreclosure auctions are right on track, as there are still a lot of people confident about the recovery of Detroit.

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There were more residential properties posted for Detroit foreclosure auctions in the first quarter compared to the same period one year ago, causing concern among Michigan officials and community advocates who expected improvements in the housing sector.

While other areas in the region, such as the counties of Macomb and Oakland and other parts of Michigan, showed declines in foreclosure activity, city officials are troubled that Detroit continued to post foreclosures in the first months of the year.

In the first quarter, a total of 13,192 foreclosure filings were recorded, marking a whopping 48-percent jump from the total of 8,913 foreclosure postings in the first quarter last year.

Similarly, the number of residential properties posted for foreclosure auctions in Michigan and the number of units repossessed by lenders in the first quarter surged by almost 11 percent to a total of 45,732 units. Of these distressed properties, a total of 11,485 were given default notices, a total of 15,642 were posted for public foreclosure home auction listings and a total of 18,604 units were repossessed by lenders.

While the first quarter foreclosure numbers showed increases across Michigan, foreclosure activity in March slowed by 11.62 percent from February. The total of 17,700 filings in March was a drop of 2,328 units from the 20,028 filings in February.

Despite the rise in residential units posted for Detroit foreclosure auctions in the first quarter, the median price for homes and condo units improved across Wayne County, where Detroit is situated. The sales price median increased in March to $33,050, a stunning 120.3 percent jump from the median in March last year.

Analysts in the region explained that home prices improved partly because of the drop in the inventory of foreclosed homes in Wayne County and in nearby counties in the region. Realtors in the region have been talking about recovery, but doubts still remain because of the continued foreclosure activity in Detroit.

Despite doubts about the recovery of the city of Detroit, there are real estate investors who believe that Detroit can regain its former status as an economically strong U.S. city. They view current difficulties as natural developments that need to occur to give way to cleansing processes and subsequent resurgence.

These investors continue to frequent Detroit foreclosure auctions and buy properties at bargain prices. One prominent investor has already purchased more than 625 real estate properties in Detroit, a strong show of confidence in the economic revival of the city.

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Average home prices in the Metro Detroit counties of Macomb and Oakland have fallen by 12 to 22 percent due to the continued unloading of foreclosed properties into the housing market and the soaring Michigan foreclosure rate. Median home prices in Macomb dropped by an average of 14 percent and Hazel Park and Lathrup Village [...]