To those of us who live in Ann Arbor, we have always thought we were exempt from the rest of the state of Michigan when it came to the housing industry downturns. Not this time. A quick look at Foreclosurenet.net will give you a list of all the foreclosure homes in Washtenaw County. There are 298 homes listed on this site.
Most of foreclosed homes in Ann Arbor and in the State of Michigan are due to homeowners either loosing their jobs or being transferred and not being able to sell their homes for what they owe.
In the 90’s many homeowners were quick to refinance their homes, assuming the market would continue to rise at the historical 8% in Washtenaw County rate. Opps, it didn’t happen and the refinance appraisals were coming in high.
As a Realtor when I visit sellers and the homeowner tells me they had an appraisal that was higher than what I determined the market value for selling to be, the homeowners were dismayed. Traditionally refinance appraisals are always high, as the banks would anticipate the homeowner was staying in their home and not selling. There is a difference in a refinance appraisal and a 90 sale appraisal to sell.
So many, many homeowners refinanced, pulled money out to buy a car, take vacations and pay off credit cards. Then the bubble burst and not only did homes stop appreciating but they declined in value. I am currently seeing home prices down to the 1998 prices in many of the areas in Washtenaw County.
If you area buyer this is a good time to take advantage of the market conditions in Ann Arbor and Washtenaw County.
Here is a cute video, I found on YouTube by Dave Girtsman that was linked to on Twitter.
298 foreclosures are a lot of perperties, but what percentage is that of the total inventory?
I've been putting off doing monthly stats. I guess I better get to it.
Hi Missy, A great post and the YouTube video was very cleaver indeed. We heard a lot about this ( At least as it pretained to Michigan) when Mitt was a candidate and these forclosures issues have been all across the nation. We sure have had our share of them as well. It is just amazing to me how vast the issue has become and I can't help but to wonder what the folks being forclosed on are doing for housing. Many landlords who concentrate on credit worthiness must be really pulling their hair out. I suppose next we will see all the lawsuits generated by "discrimination based on credit worthiness". It just seems that all this will never end,doesn't it?
I did want you also to know that I did some serious catching up on the Outlook Users group and completed reading everything since last December and re-featured some. I need to write some new posts for the group and share with everyone where I am on my current version Outlook 2007. I am still learning it and the many new features. Since you had commented on it, I wanted to let you know of my efforts to get caught up.
Lenn, out of 2963 homes in Washtenaw County.
Bill, I'll hurry over to the group. I do visit it and learn new things. Yea, landlords pull credit too, but we tell them not to expect a great credit score. We are working with a couple now from KY that had a bankruptcy but still has her house in Ky to sell. Trying to get her approved, if not she will have to rent.
Hi Missy,
I'm in agreement with you on the difference between re-fi appraisals an.d sale/purchase appraisals. We see it here too in SoCal.
As for numbers of foreclosures in my city for example, ours are up too. Right now a little over 22% of our sales are either short-sales or foreclosed properties vs. traditional sales. Other areas of newer growth known as the Inland Empire (a multi-county region with major growth in the past 20 years) the rate is higher nearing 40%-50%
There have been areas of our state that weren't hit as hard with the foreclosures or declining property values until the last few months. Now we're seeing it "trickle down". What's the old saying? "How Michigan goes...the rest of the country goes" I think that holds true for the communities within our state as well. The Metro Detroit area usually starts the ball rolling, either for the good or for the negative, and the trickle down starts from here.
Don't get me started on the inflated appraisals for refinancing...I could type for a week on that one.
I think that the main reason for Ann Arbors woes are from the excessive over building during the 90'S. I remember going for a country drive to saline or to the Dexter cider mill and now it's foreclosure land in suburbia. Ann Arbor had always ranked within the top tier of places to live which brought more people to the area than it could reasonably handle.
Ann Arbor will pull through before the rest of the state. There is a diversre economy unrelated to the auto industry. Michigan was the first into this recession and it will likely be the last one out. Nobody in the state learned anything from the 80's auto meltdown which means that we are doomes to repeat. And if nothing gets fixed this time, in 15 years we will be right back here again.
Rob, ditto to your comments. The Big 3 have to learn and they have had plenty of opportunities, even when I was in college, and my dad was a Buick Dealer we dealt with the same issues in the 70's. Ann Arbor will recover, the biggest thing to hurt us was Pfizer leaving and the inventory.
Karen, no I did not see it. I'll try to pick one up.
Kris, LOL on inflated appraisals.
Miriam, the video was cute, the song was in my head all day.
AJ, there is a sad story behind most foreclosures and short sales.
Terry, good question.
Katerina, well I hope so.
Dionne, trying to put a little humor into it.
Lynda, the fastest growing area in Washtenaw county is the hardest hit know. So many Pulte homes in sub after sub after sub.
Rob, ditto to your comments. The Big 3 have to learn and they have had plenty of opportunities, even when I was in college, and my dad was a Buick Dealer we dealt with the same issues in the 70's. Ann Arbor will recover, the biggest thing to hurt us was Pfizer leaving and the inventory.
Karen, no I did not see it. I'll try to pick one up.
Kris, LOL on inflated appraisals.
Miriam, the video was cute, the song was in my head all day.
AJ, there is a sad story behind most foreclosures and short sales.
Terry, good question.
Katerina, well I hope so.
Dionne, trying to put a little humor into it.
Lynda, the fastest growing area in Washtenaw county is the hardest hit know. So many Pulte homes in sub after sub after sub.
Missy, great video and good post. it's really sad - in some ways you think "well, duh" but in other ways, I think a lot of consumers have been misled by people they were thinking they could trust.
Anyone can be a "mortgage professional" just like anyone can become a "real estate agent" and unfortunately, a lot of people have just stopped thinking for themselves.
we took out a small, very small, home equity loan on our house to pay a few bills but mostly to finish some home improvements that needed to get done - no, no granite counter tops, no stainless appliances; very unromantic stuff like renting a back hoe to dig out the foundation and put in a perimeter drain; upgrading our electric service to 200 amps; switching from our 1970 oil furnace to electric heat; repairing the roof and putting on siding...replacing windows. LOL. Shoot, all this sounds like we were living in a shed to begin with! Ha! My point is - we took out only what we needed, to do what NEEDED to get done. We could easily have borrowed four times what we did - but why? I shudder to think...
People have to be careful and Caveat Emptor applies for financing as well as purchases.
Missed you - haven't been around in a while. Good to see your smiling face still working away in the Rain!
Missy,loved the video and would love to use it on my outside blog. I got a kick out of it plus it really says it all. Refi appraisals and CMA have always been different which sellers never seemed to understand. This might help that gap but more than anything hopefully it will help the visualisation of using the home equity as an ATM machine.
Excellent post and Stupendous video. Thank you for sharing.
Gena, be my guest, I found it on YouTube after someone mentioned it on twitter. Can't remember who, so many links to follow.
Karen, we've all done it or most have. Yours went into improving your home which it why they are called HOME EQUITY loans. LOL