Reuters | Posted: 07/03/2013 12:59 am EDT | Updated: 07/03/2013 9:58 am EDT
Housing prices in metro Detroit and the value of new home construction permits clocked strong year-over-year increases early this summer, with prices for existing homes rebounding faster than the national average.
Data released Tuesday show Detroit-area home prices were 16% higher in June than a year ago, beating the 12% increase for the top 20 metro areas, according to the latest Standard & Poor’s/Case-Shiller Home Price Index, a leading metric for home values.
Metro Detroit home prices are up to levels last seen in early fall 2008. The prices are about 30% off the local market’s peak of late 2005 and early 2006.
The Case-Shiller index defines the Detroit region as Wayne, Oakland, Macomb, Livingston, St. Clair and Lapeer counties.
Only six metro areas in the index saw prices rising faster in June than in the previous month — down from 10 cities in May. This could be a possible indication that rising mortgage rates are having an effect on the housing market.
In the Detroit region, the index showed prices rose 1.6% in June from May, compared to a 3.8% climb in May from April.
“Overall, the report shows that housing prices are rising but the pace may be slowing,” said David Blitzer, chairman of the Index Committee. “As we are in the middle of a seasonal buying period, we should expect to see the most gains. With interest rates rising to almost 4.6%, home buyers may be discouraged and sharp increases may be dampened.”
The Case-Shiller index covers roughly half of U.S. homes and does not report actual home prices.
Realcomp, a Farmington Hills-based multiple listing service, reported a median home sale price in July of $129,000 in the four-county region of Wayne, Oakland, Macomb and Livingston.
The Home Builders Association of Southeastern Michigan also reported Tuesday that the average value in July of a new, single-family home permit rose to $241,206 — a 12% increase from July 2012.
However, the permit data also showed possible signs of a slackening recovery.
The 408 single-family home permits issued in July in Wayne, Macomb, Oakland and St. Clair counties was a 10% decrease from July 2012.
Still, from a 12-month perspective, the 4,226 permits issued between August 2012 and this July was 28% higher than the similar 12-month period that trailed July 2012.
The Home Builders Association said the past 12 months have been the best for construction permits since 2007.
Metro Detroit housing prices stayed on the fast track to recovery in April, rising 40% over their levels a year ago, according to new listing figures released Monday.
The median sales price of a house or condo in the four-county region of Wayne, Oakland, Macomb and Livingston was $98,250 in April, up 15% from March and 40% from April 2012, according to data compiled by Realcomp, a Farmington Hills-based multiple listing service.
Realtors say a driving force behind the higher prices is the still-tight supply of move-in-ready houses for sale.
The number of listings in metro Detroit fell 23% in April from a year earlier.
One reason for the tight inventory is many would-be sellers have opted to stay put in their homes because prices, although rising, have yet to rebound to the point where they can sell without taking a loss.
Still, the number of metro Detroit home sales rose 6% from April to April.
In Wayne County, the median sales price this April was $50,000, up 31% from the prior year. It was $155,000 in Oakland County, up 35% from April 2012, and $92,500 in Macomb County, up 27%.
The hard-hit city of Detroit also experienced more housing market rebound in April, when compared with the same month last year. Prices rose 10% to $9,900 in the listing service’s “Detroit area,” defined as Detroit, Hamtramck, Highland Park and Harper Woods
Depending on where you live, a patio might not be the kind of thing you think about during the cold, and maybe snowy, winter months. But a patio is what many people enjoy on a sunny warm afternoon. It just feels good to sit outside and sip some iced tea or lemonade. That's the picture your real estate agent would want to capture when listing your home for sale.
Patios are appealing because they can create a sense of peace, open space, freedom, and they can seem to extend the square footage of livable space on those good weather days.
Set out on your patio some simple but comfortable patio furniture when you're listing your home and you might find that prospective buyers take a seat and think about your home. Good! Let them soak in the energy of the home. The way it feels. The way it allows them to relax. Set some brochures out on a side table. Maybe even a good book. You'd be surprised what these buyers pick up. If they enjoy themselves while sitting on your patio, you're likely to have piqued their interest in your property.
So, what if you have a backyard but no patio; is it worth investing in one? The answer depends on your financial situation but there's no doubt that having a patio or a deck - a space outdoors to relax - is a plus.
However, here are a few tips about creating that patio space. If you have a small backyard, you don't necessarily want to take up the entire space with a concrete patio. The reason? Greenery is also appealing. Basically, you want to have the patio proportionally sized to your yard. So you don't want to have a huge yard and tiny patio nor the opposite.
Your patio should be located close to an entryway to the home, typically the kitchen. This is so that if there is grilling or eating outside, people can easily access the kitchen as opposed to walking through some other room in the house first.
Patios also should be located in areas where there is some level of privacy. A patio is most appealing when you can sit back, relax and enjoy a good meal, book, or conversation without feeling like you're being watched. So the backyard is usually the best location.
Buyers often consider a well-built and maintained patio a plus and may create a higher selling price for your home.
To cover or not? Often when homeowners put in patios, they question if adding a covering would help increase the value of their home. That really depends on many things such as if the covering is well built and maintained and if it's aesthetically pleasing, not blocking views, etc. In the case where it's crafted and maintained well, the patio and its covering can increase the appeal of your home. That could translate to a higher selling price as well as a faster sale.
By Ben Levy
Basement flooding can be a serious problem for homeowners. Severe weather, sewage backups, plumbing problems and mechanical failure can all lead to costly and time consuming projects. Preparing your basement in advance and taking necessary precautions will, in almost every case, be money and time well spent.
Severe weather, usually a lot of rain in a short period of time, is one of the most common causes of basement flooding. The super saturated ground around your basement can cause water to leak from the soil, through the walls, and into your basement. Make sure your gutters are clear, down spouts lead away from the house by at least 6 feet, and the grade around your house gently slopes away from your foundation. This will direct most the water away from your house and usually prevent basement flooding.
Sewage backup is, unfortunately, often times unavoidable. Anything that comes in contact with sewage may be contaminated and have to be thrown away. If sewage backup is a concern, keep valuable and important items well off the floor, and consider avoiding refinishing your basement. Plumbing problems are caused when an incoming or outgoing pipe in your home bursts. Pipes on upper floors can cause water damage throughout your home and potentially fill your basement with water. Make sure to have your pipes inspected by a licensed plumber every so often, are clean, and are in good working condition. Know where the main water shut off is to your home and make sure everyone else in your family knows where it is as well.
Finally, mechanical failure occurs when a sump pump or water heater goes out. Imagine forty gallons of hot water spilling from your water heater and filling your basement. Or, think about your sump pump going out during a storm and your sump crock overfilling with water. To prevent these issues, make sure to know the life of the device and replace it before it goes bad. If your water heater starts to drip or your sump pump seems to be making more noise than normal, consider those as warning signs to replace those items.
Finally, when finishing a basement, make sure all floor drain lines remain unblocked. Do not put padding underneath any carpet (it is almost impossible to dry out when wet) and use tile instead of wood when finishing hard surface floors. A suspended ceiling is preferable to a drywall ceiling as it leaves the pipes and shut off valves available for inspection. Finally, develop a good relationship with a plumber, and have his or her number on hand so you can quickly access it in the event of an emergency.
Ben Hughes, handler of the weather-predicting groundhog Punxsutawney Phil, holds Phil in the air after removing him from his stump in Punxsutawney, Pa., in 2009.AP file photo
So — are we going to have six more weeks of winter?
Depending on what transpires on Gobbler’s Knob tomorrow, it could go either way.
Listening to the prognostications of a pampered, overfed groundhog is great theater but hardy something to trust — even after more than 110 years. Punxsutawney Phil last year saw his shadow, meaning six more weeks of winter.
But if you recall, February and March 2012 were hardly winterlike. Groundhog day 2012 saw the mercury climb to 44 degrees in Grand Rapids. The mercury hit 60 degrees or better on 19 days last March, including five days at 80 degrees or better.
You might say winter 2012 was a nonevent. This season was on a similar trajectory until an arctic blast and lake-effect snow pounded the region Jan. 21-24, with daily highs in the teens and overnight lows below zero or in the single digits. Lakeshore counties were blasted with more than a foot of snow, and Grand Rapids logged more than 6 inches.
What made this particular cold snap unsettling was its bitter onset.
Much of the state basked in 40-plus-degree temperatures before plunging into single digits and subzero cold. You could tell something was afoot by the rapid change in air speed and the last-minute feeding frenzy by birds.
Perhaps birds have an avian version of the breathless television meteorologists warning of bone-rattling cold and lake-effect snow. We were given ample warning of changing conditions, so no one should have been caught unprepared.
The drastic temperature swing probably will result in the loss of perennials and ground covers that had to endure subzero cold without benefit of snow. Roots of most landscape plants are injured when the soil temperature drops below 10 degrees. Snow -— like mulch, is nature’s version of insulation. The ground temperature beneath a thick layer of snow stays around 32 degrees, even if the air temperature drops into the single digits.
A science teacher in Arizona did some computing and determined that a 10-inch layer of snow has the insulation value of a 6-inch layer of R-18-rated fiberglass insulation.
Indeed, a good layer of snow on the roof tells you the attic insulation is working.
You’ll be able to see this first-hand in April when forsythia bushes start to bloom. During severe winters, the prized yellow flowers often are missing from upper branches. Blooms congregate on the lower 12-18 inches of the shrub. Buds protected under a thick blanket of snow are unscathed, while those exposed to cold, drying winds are void of blooms.
When there’s enough snow to shovel, I typically recommend piling it at the base of shrubs and on top of perennials. The operative idea here is shovel — not plow or blow.
Snow pushed or thrown onto plants is denser than natural snowfall and tends to stick together. As it settles, it can rip branches from shrubbery, according to research by the University of Vermont. This is particularly true of branches that are already brittle because of extreme cold.
Gently placing snow at the base of shrubs rather than heaving it on will offset potential damage while affording protection.
Foundation plants are prone to snow damage, but not necessarily from a plow or an overly exuberant kid with a shovel. They’re more likely to be crushed by ice and snow falling from the roof. Plants cushioned with a layer of snow will better absorb the impact. Plants protected by a tepee-shaped wooden frame fare best.
Then there is the unintended damage caused by plows. Plants situated along walks and drives often are mowed down by plows or the weight of snow being pushed at 20 mph. Many commercial snowplow operators encourage clients to place posts with reflectors at the edge of lawns and gardens to help drivers stay on the pavement. This might be a bit of a challenge if the ground is solidly frozen.
Another peril to plants is road salt and other melting agents applied to drives and walks. The next time it snows, salt already on the ground invariably is plowed or piled around plants. It leaches into the soil and damages plant roots. Calcium chloride is a safer alternative — especially is you mix it with kitty litter or sand to enhance traction.
Perhaps that is what keeps tuxedo-clad groundhog handlers from tumbling down Gobbler’s Knob while hoisting a 34-pound rodent to a sea of television cameras
5 Real Estate Trends to Watch for in 2013, Laid Out by Metro Detroit Agency
By David Muller | firstname.lastname@example.org
on January 07, 2013 at 9:32 AM, updated January 07, 2013 at 11:20 AM
NORTHVILLE, MI - RE/MAX of Southeastern Michigan has laid out some trends it expects to see in 2013. For months, reports from various real estate tracking firms have pointed to a recovery in Metro Detroit’s housing market. However, home values in Metro Detroit, while rising, remain incredibly low compared to the rest of the nation, and are also still below pre-recession levels.
"Southeast Michigan's real estate market is making great strides,” Jeanette Schneider, vice president of RE/MAX of Southeastern Michigan, said in a release. “Without question, we are on the road to recovery.”
With that optimism in mind, here are the five things the agency said it expects to see in 2013:
"Home prices will continue to rise.
According to RE/MAX data, the average home-sale price in metro Detroit in December 2011 was $108,000. In December 2012, the amount rose to $130,000. RE/MAX predicts that buyer demand for homes in good condition will continue to drive prices up.
Home inventories will remain low.
Home inventories were low throughout metro Detroit in 2012 as the local economy continued to recover. There were, however, many eager buyers willing to take advantage of historically low interest rates. As a result, homes in good condition were on the market for fewer days and bidding wars on homes in desirable areas were common. RE/MAX expects this trend to continue throughout 2013.
Low mortgage rates will continue.
Historically low interest rates will continue to make 2013 an excellent time to purchase a home. While mortgage rates are often difficult to predict in this current market, many mortgage experts anticipate thirty-year mortgage rates to rise only slightly in 2013. The overall trend of low interest rates is expected to continue throughout 2013.
Extension of the Mortgage Debt Forgiveness Act will help struggling homeowners.
In 2007, Congress passed the Mortgage Debt Forgiveness Act under which homeowners were not responsible for the taxable debt resulting from a short sale. The tax break was originally set to expire Dec. 31, 2012. Congress recently voted to extend the Act as part of the Fiscal Cliff package. The tax break will allow struggling homeowners to work with a qualified real-estate agent to pursue the short-sale process as opposed to foreclosure.
Overall market conditions will continue to improve throughout metro Detroit.
RE/MAX of Southeastern Michigan experienced positive growth throughout 2012 and expects the trend to continue throughout 2013 as metro Detroit's economy continues to improve. 2013 will remain an excellent time to purchase a home."
How to Help Boost Your Appraisal
Date:March 15, 2012 | Category:Finance | Author:Vera Gibbons
According to the National Association of Realtors, a whopping 33% of all contracts were cancelled in January, 2012. This is up from just 9% in January 2011. NAR says one of the primary reasons for these elevated levels of cancellations is due to low appraisals.
Looking to sell your home or do a refi? Then you may need to boost your appraisal.
While it’s technically the appraiser’s job is to derive a base for your home’s value based on the recent sales prices of homes that are comparable to yours — comparable in terms of location, size, condition, and age (in this order) — you need to do your due diligence as well. Get about 6 comps ahead of time. Start your research on Zillow.
Talk to those “in the know”
You also want to talk to neighbors (They may know of pending sales or properties that sold without the help of a Realtor; that can mean it wasn’t posted on the MLS, real estate agents (they may have more refined comps readily available), your local assessors, and others to better self-educate. Why? “You can’t rely on them wholeheartedly,” says real estate expert, Jim Lumley, of Amherst, Mass. “While some are trained, highly skilled/competent and know the market, others are not.” That leaves plenty of room for error. They may even be looking at comps in the wrong ZIP code, he says. “A three-bedroom ranch that is similar to yours but in the next town over could have an entirely different pricing structure.”
Highlight value-added features
One of the first things the appraiser — picked at random and ordered through a third-party appraisal management company — is going to do is come over to your house to inspect its condition. While keeping it well-maintained (clean and clutter-free, from the outside in) is always a smart thing to do, think about what distinguishes it from homes that are similar to yours, and therefore makes it more valuable, says Sara Stephens, president of the Appraisal Institute. Do you have an extra half bathroom, a finished basement or other features that are not necessarily detailed in the assessing records? Do you have the biggest yard on the block? Is your home located in a more scenic area than the comps in your neighborhood? “Respectfully tell them what you know,” treating the appraiser as a member of your team, says Stephens. “It will increase the odds of your getting a fair and accurate assessment.”
Did you install energy efficient windows? New insulation in the attic? Central air? New roofing? Flooring? Heating system? Plumbing? “Make a list of all the home improvements you’ve made over the years – as well as the costs — and don’t be shy about providing the appraiser with this list,” says Paradise-California based appraiser, Doreen Zimmerman, author of Challenge Your Home Appraisal. “We welcome the input.” Just don’t mention projects/various maintenance work you intend to undertake. You don’t get credit for unfinished business!
If you’re unhappy with your home’s valuation by the appraiser (the process takes about two weeks; you can get a copy of the appraisal from your lender), you can always challenge it. Most lenders have an appeals process, but keep in mind that a successful rebuttal is going to depend on your ability to support your case, says Zimmerman. “You can’t just go in there and insist that your home is worth more than its appraised value.” Keep your emotions out of it, and present the facts only. “When you make your case to the lender, you have to prove that there was an error, a series of errors, or omissions — such as comps that should have been taken into consideration but were not. If you are dissatisfied/getting a run around, or otherwise not yielding the kind of results you feel you deserve, you can always take your case to a higher level — your state’s appraisal board.
Vera Gibbons is a financial journalist based in New York City and is a contributor to Zillow Blog. Connect with her at http://veragibbons.com/.
I bought a house in Ferndale on Nov 11, 2010 for $14,500. I know, wow, right? It is a small house with no basement or garage. When I bought the house I thought I was getting a deal. AS an appraiser I know market values. At that time I was aware that the home wasn't worth much more than the purchase price. I figured that when the high volume of bank-owned homes for sale decreased, the value of my new home would go up.
Well, it has now been 17 months and the value is still about the same. The market has not declined or increased much during that period, but the percentage of bank-owned homes on the market has not changed a bit. Sure they sell quick, but they just keep coming. I check daily. Every day, 2 sell and 2 are listed, almost like clockwork. All may recent area analysis reflects a period of stability, but it sure seems more like a period of nothingness.
How many more of these bank-owned homes are out there. I am assuming that the banks figured out that the homes will sell for slightly more if they don't list them all at once. Too many homes at once decreases demand, in turn value.
I do not like the game!!!!!!
Maintaining a perceived period of stability to help increase consumer confidence is not working. We will not recover from the decline in our area until the bank-owned homes are mostly or all sold.
I am aware that if the banks put all their homes on the market today, it would significantly decrease property values in the area, until they are mostly sold. We would be taking 2 steps back, but then 1 giant step forward. Then we can finally start recovering from the decline. This period of nothingness is not helping anyone. Lets get these homes on the market. If that happened, in a few months we would all see our home values starting to increase again.
Wouldn't that be nice.