A marketing report from Real Estate One

August 31, 2012
Real Estate One
Norman, W Werner

Norman, W Werner

248-763-2497

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This little marketing report is generated by my company and sent oout via email to some of my clients. I though you might enjoy it, too. It has a couple of nice charts about the Michigan market.

 

Michigan Monthly Market Update – August 2012

July pending sales jumped up from June’s pace, proving once again that our recovery is moving in the right direction but not in a straight line. Some months are moving up quickly, others just a bit, but so far, always up! The overall Months Supply of Inventory (MSI) for Southeast Michigan hit a five-year low at 4.6 months and NW Michigan was also at a five-year low of 9.1 months.
MSI Chart

The average MSI is the industry standard index for following the market direction, but to get to the true index number we look at the MSI in the market segment where the majority of buyers are, those homes on the market less than 90 days.

Value Chart

The pattern follows the same trends as the overall MSI, falling to the lowest levels during the market decline, and clearly showing a sellers’ market, which explains the multiple offers we are seeing in the under-90-day market. Low inventory is also helping fuel the rising price trends shown in the following charts with values picking up speed since the beginning of the year. Price per square foot is not a pure indicator of appreciation, but it does filter out some of the distortion found in median values as an indicator of general value trends.

Appraisals have been a challenge for the past 18 months as appraisal standards struggle to keep up with rising values. Although there still are many issues, the good news is we seem to have turned the corner with appraisal shortfalls shrinking daily. More and more appraisers will take into consideration the details on multiple offers in their evaluations, so if you’re in a multiple offer situation, and your Realtor is able to obtain information about those multiple offers, they should include them in their comparable presentation to the appraiser.

This month was a particularly strong month for our family of companies, with the best market share gains across the board of any month so far this year.


Seeing good trends in the data…

August 29, 2012

I track sales in 9 local real estate markets that surround (or are near)  Milford – Milford (Village and Township), Commerce Township (to include Walled Lake and Wolverine Lake), Highland Township, White Lake Township, West Bloomfield Township and Lyon Township and South Lyon in Oakland County;  plus Green Oak, Brighton (Township and City), and Hartland Township (and Village) in Livingston County. I’ve been tracking these same nine markets for a about three years and five of the nine for several years longer.

Basically I show the sales data every week and report the following statistics – Whether the sale was a distressed sale (a foreclosure or short sale), the listed price, the sold price, the percentage of sold verses listed prices, the SEV for the home as recorded in the Public Record Database at the time of the sale, the SEV multiplier that the sale price represents (SEV is supposed to be ½ of the market value, but these days homes are selling for 2.2 to 2.5 times the SEV, which indicates that the assessors overshot in the down direction), The number of days that the home was on the market (DOM), the Square Footage of the home as reported in the MLS and the listed value per Sq. Ft. and the Sold value per Sq. Ft. For each market I show the Averages for those values and the Median value for the data.
As I looked at the data yesterday when I posted it for last week, several things jumped out at me. One is that this is one of the few times in the last few years that distressed sales as a percentage of all sales has been below 50% for all nine markets. There are still some hovering at mid- to high-40% levels, but there is also one that has remained at 0% all month, so far (Milford). The days on market (DOM) numbers are down on average across the board, indicating that properties are selling faster. Perhaps the most important is that four of the nine markets have broken back through the $100/Sq Ft Average barrier. To me that’s a significant figure, sort of like the Dow has “barriers” at 12,000 or 14,000.
In housing in this area, when the bottom dropped out of the markets we dropped from sale values in the $124-144/Sq Ft ranges during the peak in the markets that I track down to markets that were averaging $70 – $80/ Sq Ft. Admittedly much of that severe drop was due to the high percentage of foreclosed houses in the sales mix during that period; however, it did impact the market values of all houses on the market. So we are not back to peak levels and may not get back to that level for a decade or more (if ever); however, we are getting closer to market values that will allow many who have been sitting on the sidelines to consider listing their homes.
Not everyone bought or refinanced and took out equity during the bubble years; however, even those who were financially conservative and may have had a big down payment when they bought found themselves under water when homes values fell as far as they did in the recent recession. I see articles that the housing market is back to the value levels of this year or that and I’d say that we regressed back into the mid 1980’s somewhere, so far as lost value went. A few of our local markets lost 30-40% of their 2006 values and a very few actually lost more than 50%.
Now things are trending back up. If we get back on the historic home appreciation curve of 3-4% per year it will take us a decade to get back. I suspect that the lack of inventory in the market will drive a faster recovery, at least until the market reaches a new supply and demand equilibrium.  The data that I look at each week certainly seems to indicate that. If you want to see for yourself, go to http://www.movetomilford.com and click on the choice “ What have homes in this area sold for?” There is data there for all nine markets going back three years and for some of the markets going back further. The data that I collected has changed a bit in format over the years, but you should still be able to compare some key metrics.
And if you’re ready to see what your home is worth on the market today give me a call. I don’t charge to do a Market Analysis for you and you might just be surprised that you can take your plans off hold and move on with life by selling now and moving to take that new job or moving to that retirement home or that place closer to the kids. Maybe it’s time to look at that move-up house that you’ve been dreaming about but felt that you couldn’t afford. You just won’t know until you see where you are on your current place.

Thinking about a life not lived…

August 26, 2012

I’m attending my 50th high school reunion in September. One is given pause to reflect on a life lived since high school, especially since the organizing committee had ask for a write-up about what you’ve been doing since high school. That was a daunting task – trying to summarize a life lived in a page or two.

I got to tell my stories of going off to college, meeting and wedding the love of my life, going off to exotic places (Iran) and dangerous places (Viet Nam), having children and a career in business, living in several states and finally settling in to Milford for a great life in the Village of Milford.

Recently I got an email from the reunion organizers listing people from our class that they could not locate and people that have died.  Sadly, my best friend from high school was among those listed as deceased. I was really sorry to hear that, since I was looking forward to talking with him about his life. I went off to college at the University of Illinois and he, on a full-ride scholarship headed off to Harvard. I only saw him briefly once after we both left, during the summer break between our freshman and sophomore years at college. He was struggling a bit with both the academic load and the fact that even having a full-tuition scholarship didn’t really cover the cost of going to Harvard. I guess I’ll never know how is life turned out, but he did live until a few years ago, so at least he had a life.

One of the other names that is on the deceased list was a guy I knew, but wasn’t really buds with in high school. From what I can tell he went off to Viet Nam and was an early casualty there. That started me thinking about the consequences of a life not lived. There was a romance and marriage that never took place and children that were not born. There was work that someone else did in his place, little league games that he didn’t get to attend,  a church pew just a little more empty because he was not there and so much more. Who can say for sure how his home town or state or even the nation might have been changed had he come home from that war. I suppose that the same “what if” thoughts can be had about any life that is cut short like that.

I’ve decided that I’ll not spend my time at the reunion guessing what might have been; there’s to much catching up to do on what actually was. I’ve been getting some indications from email and Facebook postings about the lives of some of my old friends from High School. Of course, I’m sure that none of our teachers from that era remain alive; which is a shame, since it would be nice to go back and thanks them for the start they gave me.  I’ll post again after the event to let you know how it went.


You haven’t lived in Milford until…

August 23, 2012

You’ve seen the waterfalls of Milford. Yes the plural is correct. There are at least two waterfalls in the Village of Milford. The most obvious and best known waterfall is now called the Mill Valley Falls, which is located behind the Mill Valley Strip Mall on Main street right where it branches off into Main street to the north and N. Milford Rd to the northwest (at the Flatiron Building with the waterwheel and geese statue).

Thousands of cars a day pass by the Upper Mill Pond just north of the Mill Valley complex and see the Upper Mill Pond. I’m sure that they wonder where the water goes. They can actually see the top of the falls at the south end of the pond as they pass by; however, I wonder how many have actually seen the falls. It is now quite beautiful, due to the efforts of the Mill Valley owners, who spend quite a bit to have it totally landscaped and a new stairway to the top installed. There are little seating areas along the path to the top and an area to sit and listen to the falls at the top too.  It’s really quite soothing to sit there and listen to the water falling over the concrete stepped falls. This falls is about 20-30’ in height, so the water has some force behind it. After heavy storms and during the spring thaw the water flow can be quite rapid and the falls become almost a raging torrent. It has a pretty good waterfall roar almost all the time.

The other waterfall within the Village is not nearly so dramatic. In fact it is so peaceful and pleasant that it is one of those places that you just want to lay out a blanket and take a nap. It is off lower Mill Pond, next to the Pettibone Creek Powerhouse. You can’t really get to this falls, but you can get close enough to see it and hear it. You can either go in through Central Park (to the upper parking lot) or come in off W. Liberty, which is reached from Commerce by turning left (South) onto Cabinet St at the entrance to the Prospect Hill shopping center (The Kroger Shopping Center) and then east on W. Liberty until you get to the Pettibone Creek Powerhouse (itself to be the topic of another of these missives). The Lower Mill Pond Falls is right next to the Powerhouse, on the west side. It is probably only a 10 foot drop. But is makes a nice sound and is quite pleasant sit and watch and listen too.

So, there you have the waterfalls of Milford. If you haven’t ever taken the time to go behind the Mill Valley Center, to the lower level, or deep into Central Park to the Power house, then you haven’t really lived in Milford. Take the time to go find these wonderful little places and enjoy them. Take the whole family. Kids love waterfalls.

Next time I’ll talk about the Pettibone Creek Powerhouse, which you will see, if you visit the Lower Mill Pnd waterfall.


Dealing with life’s risks…

August 22, 2012

“Be brave. Take risks. Nothing can substitute for experience.” (Paulo Coelho) from the Jack’s Winning Words blog.

Many of us are risk averse, we just don’t like getting outside of our comfort zone and trying new things that we see as risky. The risk may be physical danger (like in sky diving) or perhaps the chance for social embarrassment (talking to people at a party) or maybe the risk of failure (calling on that FSBO or expired listing) and loss of self-esteem.  For some there is a perceived risk in blogging – what shall I write about and how will people react to it? Whatever the perceived risks, the avoidance of doing something because of those risks means that you have also missed the opportunity for new experiences. In those cases you end up with regrets instead of experiences.

It is the accumulation of experiences and the intelligence to understand what they mean that leads to wisdom. So, one can end up as a wise old man or an old fool with lots of regrets just by making the decisions not to take risks. The end game is still the same, whether you live life to the fullest and take some risks along the way or cautiously avoid all risks along the way. What do you do when faced with a risk in life?


A slice of Americana right here at home…

August 19, 2012

I recently spent a few days meeting with most of the local merchants and businesses while soliciting support for the upcoming Milford Home Tour. The experience gave me pause to reflect on how idyllic a setting the Village of Milford really is. I got to meet with the Butcher and the Baker, the Barber  and the Feed Store proprietors, because we still have all of those things in our little Village. I met the shoe store owner, several clothing store owners and a couple of our jewelry store owners, too. Then there were the furniture stores, the candy store, the local photographer and the kitchen/cooking store. Of course the more prosaic stores are there too – the auto parts stores the drug stores and grocery stores. Finally I got to meet with most of the owners of our great local restaurants. See the header at the top of this page for a composite view of some of the stores of our downtown.

The thing that stood out for me was that all of these little, individual businesses still existed right here in the Village of Milford and that, for the most part, you could park once and walk to all of them by going up and down Main St. You just don’t find such a great assortment of stores and businesses in small towns anymore. Milford is far enough off the beaten path to have avoided the fate that so many small towns suffered when so-called “big box” stores moved in and took all of the customers away. Milford also had a good master plan for growth and strong and visionary leadership who carefully managed what and where growth took place, in order to preserve a strong downtown.  It worked and we still have a viable downtown that takes advantage of the great historical buildings that are there and the small town feeling that permeates everything.

Many of the local merchants that I talked to have had a tough time recently, with the down economy taking its toll, even here. Every one of them said there’s no place else that they’d rather be than in Milford, even in this economy. That says a lot, too.

Several of the local businesses decided to support the Milford Historical Society and its 36th annual Home Tour during the third weekend of September. The fact that we have the local Milford Historical Society, with its museum and a Home Tour that’s been going on for 36 years also speaks volumes about small town America and our little Village. People in Milford value and have preserved the fine old housing stock that grew up during the mid to late 19th Century. Milford was never a rich town, but it has preserved the bigger, nicer homes that were built by its early merchants and businessmen, as well as the smaller homes that were occupied by the workers of the day. There are no real mansions in Milford, but there are some fine old homes that have the best features of homebuilding of that era. Some of them are on display each year for the Home Tour.

So, if you get the opportunity to get out to Milford for the Home Tour, try to come on September 15th so that you’ll also have time to wander around our beautiful downtown. Most of the downtown stores are not open on Sunday, but on that weekend some will be, because there is also the big Milford Car Show downtown, too.  You’ll be able to easily find our Butcher and Baker and many of the other businesses that I’ve mentioned. The Feed Store is a little harder to find, but it’s there, tucked away off a residential side street (Houghton St) on the south east side of town. If you have an animal of almost any type you can find feed and other things for it there, along with a proprietor who’s more than happy to chat with you about your pets.


Local bits and pieces…

August 16, 2012

Things can’t be that bad in the economy – I’ve heard from Kim Galbraith, owner of 2 Moms & a Mop,  a few times lately that she can’t find people to work on her cleaning crews. You would think that with an unemployment rate stuck near 9% it wouldn’t be all that hard to find people who want work. I guess you’d be wrong. Perhaps it’s that last word – WORK – that scares people off. Kim pays well and even extends a benefits package to full-time employees. She is looking for reliable workers who will show up for work and work to the standards that she has set for her business. If you or someone you know is looking for employment and are not scared off if it involves work, click here for an application that you can send in to Kim.

An opportunity to support a local tradition – I’ve spent the last two weeks soliciting support for the upcoming Milford Home Tour. Milford has one of the only successful home tours in Oakland County. Our Milford Home Tour, which is presented by the Milford Historical Society, is now in its 37th year. I’ve got lots of sponsor packets out and I hope that things have improved enough in the economy that local businesses can spend a couple hundred dollars to support the Milford Historical Society and this traditional fall event. Call or email me if you’d like to be a sponsor or a support of the Milford Home Tour. Supporter packages start as low as $200.

The third weekend in September (14th and 15th) will be another of those busy weekends in Milford. The Home Tour is on both days; however, Sunday is crammed full of things to do. There is the Milford Car Show, the largest annual car show in this area, that takes up all of Main St and runs from about 8 am (check in time and positioning cars on the street) until 4 pm. The actual display time and voting time for the public is 11 am until 4 pm. For more on the Milford Car show and how to register a car, click here.

Then there’s the Tractor Show out at the Huron Valley State Bank parking lot at the corner of Milford Rd and GM Rd. Tractors of all vintages and type will be on display there.  That show runs from 11 am until 5 pm on Sunday only.

Finally there’s the annual Rotary Club of Milford Duck Race. Thousands of yellow rubber ducks will be dumped into the Huron River east of the Village and will be swimming frantically for Central Park where the first duck across the finish line will win a big prize for its owner. To find out how to get a duck in the race click here.

Milford honored to host the 2012 Oakland County Heritage Conference – The Annual Oakland County Heritage Conference will be held in Milford this year on September 19th at the Milford Presbyterian Church. This conference, which is sponsored by the Oakland County Economic Development and Community Affairs Office will be focusing upon what makes someplace a “Place”, a destination. Milford was chosen for its strong integration of its historical downtown and Historic District into the fabric of the community. The meeting attendees will be taking walking tours of the historic downtown area and of a portion of the Historic District. The group is particularly interested in how Milford has been able to successfully conduct the Home Tour for 37 years. For more on this conference, click here.

Of course to keep up on a daily basis with what’s going on inthe Milford/Highland area, go to my web site http://www.movetomilford.com for the complete upcoming events calendar.