Since the housing market bubble burst, Michigan’s own real estate maket has suffered greatly and taken almost a year before showing any signs of recovery. But now with it on the slow climb back up, some real estate experts think the recovery could be short lived if banks and homeowners can’t get on the same page.
The problem, experts say, lies in the improvement in housing prices, including here in Oakland County. Because of the slow increase in prices, many homeowners who were able to ride out the wave of short sales and foreclosures are ready to sell. Banks too might see this rise in prices and turn away from the leniency of past years and forego future short sales. But as experts point out, this might not work out so well for people who are failing to pay their mortgages and need a short sale in order to prevent foreclosing on their homes.
An increase in home prices along with an increase in foreclosures seems to be an unlikely pairing, but as Daren Bloomquist from Realty Trac points out, this could be a very real future for Michigan. It’s far cry from the problems cropping up in other states across the nation though. States like Arizona, California and Florida are seeing an increase in properties being purchased by investors. Would-be property owners are finding they are being squeezed out of potential real estate transactions by investors who can offer sellers up-front cash for their homes instead of a lengthy selling process.
Some people across the nation have already expressed their concern that the market could be headed towards another crash if banks and homeowners continue to stay on different pages. It will also be up to the major players in the real estate market to carefully monitor how their actions are affecting the stability of the market and make necessary changes before another detrimental crash strikes the nation again.
Sources: Michigan Public Media, “Michigan’s improving real estate market may lead to more home foreclosures,” Steve Carmody, May 30, 2013
The Deal Book, “Behind the Rise in House Prices, Wall Street Buyers,” Nathaniel Popper, June 3, 2013