It's been a long time coming but the real estate market may finally put a smile on the faces of people trying to sell their homes in Michigan. Many residents across the state anxiously looked on as home prices plummeted to all time lows during the recession and there was a real fear that the prices would never rebound. But as the country rang in the New Year, the spark in the economy breathed life into the struggling real estate market once more.
During the recession, real estate agents around Lake Huron's southern shore saw massive changes to the real estate market, and not just in terms of foreclosed homes. As the automotive industry scaled back, so too did blue-collar families who had owned vacation homes along the shores of Lake Huron in Michigan. Families no longer able to afford two homes were forced to sell their summer homes for a more fiscally responsible future, a true reflection of the changing economy.
The number of sales of previously occupied home has risen 7.8 percent between August and July this year. The increased activity in the housing market is at its highest level in over two years, at a seasonally adjusted rate of 750,000.
We've written in the past about the difficulty faced by owners who invested in a larger, more luxurious home during better economic times. Many owners who bought in the early 2000s have continued to hang onto their homes even as the mortgages may be underwater, in hopes that the prices will recover. In our last post we discussed the generally positive effect this has had on the market in Detroit, where homes these days are selling quickly and at asking price because of lower inventory.
Single-family homes have been a hallmark of the American Dream and ownership has been an important life accomplishment for many people. However, the housing bubble and foreclosure crisis has turned the industry on its head in many ways and owning a single-family home is becoming less and less common.
As the housing market continues its slow but steady recovery, many Michigan investors and residents are considering purchasing properties while prices are still low. At the same time, the market has gotten more competitive than it was over the past few years, and desirable properties are now getting multiple offers at competitive prices, giving sellers an advantage in choosing the most desirable buyer.
Amidst all of the news about lower foreclosure rates and an improving economy, low housing prices linger as one of the primary signs of a recent recession. While this is good news for investors and buyers looking to get a good deal on a property that will increase in value, it makes selling a home more difficult and sometimes financially painful for people who bought when the market was better.
We've written a lot on this blog about the improving real estate market, because its our business and because it's an exciting sign of a recovering economy. One major favor that has been driving down home prices over the last few years has been the high number of properties available for sale in a given area. High foreclosure and vacancy rates meant that a buyer had many options and could demand a lower price.