I saw a report today for June's real estate sales in this area. Sales and listings were down compared to last month. Sale values, both the average and median were up. New home starts were up in Lyon Twp but stable or down elsewhere. My own data confirms that we appear to be in a period of mixed market data that, on the surface looks a bit like another slowdown.
What seems to be exacerbating the situation is the fact that so many would-be sellers are still under water on their mortgages that listings are in the dumps - no one in that condition can afford to list. In our area, the banks have sold off most of their foreclosure inventory and even short sales are down. Homeowners are hanging on by their fingernails and would be buyers are getting frustrated because there is so little out there to look at. That has been a mini-boom for the new-build market, especially for those builders smart enough to adjust their build content to suit the lower market.
Usually in a Presidential election year we can count on seeing some extraordinary efforts by the incumbent President to short things up or make things temporarily better (often at the sacrifice of long term good). We’ll probably see that between the conventions and the election. The President and the administration still have stops that they can pull out to help the housing market. Right now he is focused upon the unemployment issue, but housing will come back into focus before the election. Count on it. The housing situation is still a major drag on the economy and when all is said and done, remember the phrase – It’s the Economy Stupid! The politicians won’t forget. They will find a way to make it all better, even if it's just a band-aid.
What should the homeowner do? Be ready to act. Something will likely be done to make it easier for you to refinance or to sell and to deal with the negative equity situation. For buyers; keep looking. There is as huge a pent up desire to sell as there is the pent up demand to buy and sometime before the election the politicians will figure out a way to let homeowners loose a flood of homes onto the market. Be ready to act when you find that perfect new home.