May continued the same core trends as the prior six months with increasing sales and falling inventories for under $100,000 and the opposite for the above $100,000. There were some signs of the GM and Chrysler effect. The pace of showings and units sales did slow, but the first week of June showed a quick rebound in both again showing the surprising resilience of our market. Our percentage of bank owned and lease sales declined as well in May, reflecting the reduction of bank owned listings in the market. All indications are that it is a temporary shift as banks continue to work through their loan modification efforts to reduce their foreclosures loads. Michigan’s new law allowing homeowners an additional 90 days to negotiate a loan restructure will go into effect August 1st, which will help to reduce and spread out the foreclosure inventory even more.
Great news thanks to the efforts of the Michigan Home Builders Association. HUD has finally issued a Mortgagee Letter that states that condo project approval in no longer required for Site Condos. Also, this month we will be rolling out our Home Mortgage Protection Program that provides mortgage payment protection should a buyer lose their job, similar to what many auto companies are offering. It is offered through John Adams and you will be getting the details next week.
We know that our web site draws the most Michigan traffic, but did you know that our listings are also on 7 of the top 9 national real estate listings web sites (the last two are not yet able to take our listings), covering nearly 40% of all real estate web visitors from those sites alone (Hitwise May reports). We also distribute to 30 (and growing) other sites, focusing on a variety of niches to provide the broadest web exposure of any broker in Michigan.
All lenders and appraisers are under new federal guidelines, making it more difficult to address low or incorrect appraisals. More than ever it is less what the Buyer or Seller think, but what the appraiser thinks for value. In many cases it may be wise for our Sellers to consider appraisals when the home is first put on the market to get an up front feel for any value issues.
For Fence Sitting Buyers who recall high school algebra formulas, this is an important one to keep in mind: Tax Credits + rising interest rates > falling prices. In other words, the value gain receive by taking advantage of both the expiring Tax Credits and low interest rates will exceed any gain from waiting for prices to fall.
Here are our numbers for May as well as the market overview for May and an additional trend analysis for the past 9 months.
