Michigan Monthly Market Report – April 2013
For the first quarter of 2013, Michigan is still a leader in the housing recovery but a number of states have caught up, extending the housing recovery across the nation. Throughout the state we are seeing inventory shortages and rising values. Southeast Michigan remains the most active with the lowest inventory and strongest buyer demand. A new term is being used in the industry: the Shadow Demand. Like the Shadow Inventory which represented the potential bank-owned homes that could go on the market, the Shadow Demand represents the pent-up Buyers who have been holding back for the past 5 years. While the release of the shadow bank inventory has been slow and steady, the Shadow Demand seems to be jumping in all at once.
We expect a shortage of homes for sale throughout 2013 and 2014 with inventories rising and demand slowing down a bit in 2015 as interest rates increase and the Shadow Demand is dissipated. How quickly home inventories will raise depends on two factors: the pace of appreciation, and more importantly, how quickly Sellers realize that home values are improving. For many Sellers, values have risen enough that it makes sense to sell now, particularly if you are also buying.
For anyone who has purchased a home in the past four years, particularly investors, it is a great time to test the market. You should be pleasantly surprised on the potential return on your investment. The same holds for those who leased their homes, waiting for the values to rise.
Historically, with low For Sale inventories, home builders fill the gap. So far, local home builders, which traditionally make up the majority of new construction, have had difficulty obtaining financing so they have not been able to supply any inventory relief.
Following the market trends over the past three years, you can see values have been moving off the bottom since the spring of 2011 and gaining speed these last three quarters.
The next two charts show both the decline in the number of new home listings entering the market as well as the increase in the number of homes being placed under contract. It is interesting to note the declining bank-owned share of the market.
The result is a big increase in Sales Absorption, which is the percent of the available homes being sold each quarter. Considering that about a third of homes for sale are not really saleable because of condition, motivation or price, a 44% rate this past quarter represents a true absorption of closer to 70%, which is the driving force behind the double digit appreciation rates.
As a company we continue to gain a bigger piece of the pie, and most importantly, we are gaining market share in the number of new listings taken. We are working hard to reach out to you, our clients, and show you the opportunities in this market.
It is important to note in this improving market that a decline in the number of sales reflects the shortage of inventory, not a market slowdown.
If you would like more information on the market, like to list your property, or want information on any property with any broker, you may call or email at anytime.
Dennis L Hubbard
As a member of the Committee to Increase Voter Participation (CTiVP), I was fortunate enough to have the honor of working with Farmington Hills City Councilman Richard Lerner (City Council Liaison to the CTiVP) in putting together the recent debate held at Harrison High School (HHS). Attendees included Congressman Gary Peters (D-9th Congressional), Vicki Barnett (D- 37th District), Bruce Lilley (R- 37th District candidate) Cathy Webb who represented Bill Dwyer (R- Oakland County Commission 14th District) and Todd Stearn (D- Oakland County Commission 14th District candidate) The debate moderator was Harrison student Connor Rubin, who did an amazing job organizing and presenting student questions for each of the candidates. Connor previously represented Harrison High School as one of two Michigan students at the United States Senate Youth Program held in March 2012. The student submitted questions were insightful and covered a wide range of topics from jobs and college costs/funding to serious social issues such as gay marriage and medical marijuana. Overall the event was considered a success by everyone involved.
On behalf of the CTiVP, I’d like to thank Richard Lerner, Angela Leach (Academic Dean at Harrison High School) and each and every candidate who graciously took time out of their busy schedules to attend this important student event. Click here to view photos from the debate.
Here are some local news articles covering this event.
If you have pictures of Fall colors here in FFHILLS, send them to me at DennisLHubbard@gmail.com and I’ll share some of them for all to enjoy!
With a small budget to update the Sugar Shack, we had to decide what was crucial to change to make it aesthetically habitable for a few years. We realize that there may be some things we want to do later, especially if we are here longer than a couple of years, but this was a good start. Besides painting, here are the three things we did:
There are many who have taken sides in the Bates vs Greene’s debate. A creative and fun group of people created a Committee in support of the two local businesses. Both the employees and the customers have enjoyed this certificate and the spirit of friendly competition it represents. To “Like” Greene’s on Facebook, Click Here.
The temperatures are mild so there is no need to turn on the A/C just yet. Why spend the money cooling a home when mother nature will do it for you? All you have to do is open your windows. When the temperature rises to a point the A/C is an absolute must, you’ll turn on the air and enjoy the man-made cool air coming from your vents. That is, unless there is a problem with the A/C! It happens every year, the weather warms up and you open your windows. It would be a good idea to also give your A/C a test run before the weather warms up too much.
Yesterday I gave my cooling system a test run and to my disappointment, discovered my A/C unit was not working. I just bought this home less than a year ago. It was a bank owned home which means I have very little information regarding the history of maintenance. I could troubleshoot a few items on my own, but decided to call in the experts to look at my system thoroughly to bring me up to speed on where my cooling system is at in it’s lifespan. The last thing I want is to get my system working now, then on the first 100 degree day have a failure. At 1:47pm I called AJDanboise on Grand River here in FFHILLS. My hope was to get an appointment to have a technician come out later in the week. I was shocked to hear there could be a tech out the same afternoon. I was told to expect a phone call from a tech when one was available and ready to come to my home. At 1:57pm I received a call from Noah, a HVAC technician. Five minutes later, he was in my driveway ready to work!
Noah was clearly knowledgeable, professional, and eager to solve my cooling problem. As it turns out, my problem was in the connectors of the thermostat. It’s an easy simple fix. Rather than cutting out early having solved the problem, Noah continued to go through the entire system.
Everything from the capacitor to the filter was examined. Evey step of the way, Noah was informative, providing maintenance and troubleshooting tips. He never tried to sell me a new unit. He was a trustworthy professional HVAC Technician. In today’s business environment, you do not always get what you want or expect. I am happy to say, in this case, I received more than I expected.
In just under one hour, I went from initial phone call to working A/C and more knowledge than I can retain. I would recommend AJDanboise to anyone in FFHILLS.