Reflection on my market...

2010 was a tough year for me in real estate. I closed about as many sides as in past years, but made much less from the efforts involved. Looking back, I only had two deals that were not either foreclosures, short sales or leases; two deals that I might classify as “normal” real estate deals. The rest were struggles with banks on short sales or with sellers and banks on short sales or just leases, which now make up almost 20% of our local market volume. Distressed sales – foreclosures and short sales – make up 60% of my little real estate patch.

I cover and report on six local markets, which are made up of six townships and the various villages and cities contained within them – Milford, Highland, Commerce, White Lake, Lyon and Brighton. That market spills over two counties – Oakland and Livingston – in which I do literally all of my real estate business. I list and sell houses outside the six markets that I track, but they are the ones that I focus upon with marketing efforts for listings and buyers.

The real estate statistics categories that I track on a weekly basis for these markets include the listed and sold prices of every home above $20,000 that sold during the year. Admittedly that is an arbitrary price cut-off; but I wanted to eliminate the leases and the sold as a tear-down homes. I calculate the percentage of sold vs. list price.

I record for each sale the State Equalized Value (SEV) listed in the public records. That is a number that is unique to Michigan and is supposed to represent ½ of the assessed value of the house (it is used for taxing purposes, although there is yet another Michigan-unique number for each property called the Taxable Value). I also calculate the sold price vs. SEV to see how close it really comes to being ½ the market value.

I record the Days-On-Market (DOM); although that is a mostly meaningless number these days what with all of the agent shenanigans going on with re-listing homes every month or so, to keep them “fresh” on the MLS. Finally, I record the Square Footage of the home and the list price cost per Sq Ft and the Sold price Cost per Sq Ft. There is enough data in these weekly reports to get a really good feel for these markets. In addition, I keep these reports by the month and have three years of data on line, month-by-month.

This year I also started a running Y-T-D report for each market; so now I’ll have yearly data on line, starting with this year. I’m trying to decide whether it makes sense to keep that annual data separated out by month next year. It probably does, so that one can see the differences in the market month by month. Below are some summary statistics from these reports.

In the Milford market, which includes Milford Township and the Village of Milford, the average sale list price was for $204K but the sales averaged $195K or 96% of asking price – not bad really and probably an indication that sellers are pricing more realistically lately. Home sale prices averaged 1.5844 times the listed SEV values. That means that the assessors are still lagging the market in terms of adjusting home values down enough to reflect the current market prices. Homes in the Milford market listed for an average of $92/Sq Ft and sold for an average of $88/Sq Ft.

Our neighbors to the north in the Highland and White Lake markets did not fare as well this year. Homes in Highland had an average list price of $156K and a sold price of $148K. Sold prices averaged 1.4072 times SEV and they sold for $75/Sq Ft vs. and asking price of $79/Sq Ft. In the White Lake market homes sold for an average of $76/Sq Ft, after being listed for an average of $80/Sq Ft.

The Commerce and Lyon markets did a bit better; however, the Brighton market was about the same as the Highland and White Lake markets. You can see all of this data at my Web site www.movetomilford.com by clicking on the “What has sold in the Milford area” choice.

I will continue to produce my weekly reports in 2011 and make more use of them as marketing tools with potential clients. They have certainly helped me make the case in listing appointments that I know and understand the local market. They also help with homeowners in price setting negotiations.