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Answering all those burning questions you didn’t know you had about home ownership.

Q3 Market Update, 2023

Picture of Jessica Dabkowski

Jessica Dabkowski

Helping you with all things homeownership!

These articles are always incredibly time-consuming for me to write because there is SO MUCH DATA. Being of an (over)analytical mind, I could spend days swimming through the research pool.

In today’s article, I’m going to work within a framework of Wayne, Oakland and Washtenaw counties because that’s where the bulk of my loyal readers are located. No one cares about what’s happening in California or New York (sorry, R & J, you know I adore you!). I have some interested buyers and future sellers in Plymouth/Canton/Livonia/Westland, so I’ll provide some additional drill down information on those areas towards the end. (I take good care of my clients. Tell your friends 😉)

If I’m not covering your area of SE Michigan, feel free to reach out for your area’s information. This information is quite easy for me to pull quickly and share with you!

Market Rumblings

Before I dive into the data (and potentially lose you to that Instagram ding), let’s discuss my take on the flavor of the market. Agents who have been in the business longer than me will wax poetical about the return of a “normal market”. I’ve never worked in a “normal market”, so this phrase lacks meaning for me.

Debbie said it best.

I was out with a pair of delightful first-time buyers this summer looking in Canton, Westland or Livonia into the first week of August, and the market didn’t feel that much different to me. Lots of showings (maybe a bit fewer), lots of multiple offer situations (one had 15), but somewhat less of the term craziness like waiving inspection.

The local markets are under tight inventory conditions. People who have a low interest rate aren’t willing to give it up, so the available inventory is down to its bread-and-butter pain points: marriage, divorce, having babies, sending babies to college, job transfer and death (lots of probate sales out there right now😬). A lot of buyers have fallen out of the market because they can’t or don’t want to afford the mortgage payments with these 7+% interest rates. You can read more on this topic in the Q2 market update.

As we’ve moved into the fall and even higher rates, the homes that are not in shipshape move-in ready condition appear to be starting to sit a smidge longer. However, the stats through August reflect the low inventory.

Note: My data source for this article is Realcomp II/ShowingTime data compiled in Info Sparks as of September 25, 2023. The data only includes single family homes (no condos, no multifamily). Stats mostly refer to the median (line ’em up and pick the middle), not the average (add ’em up and divide), so pay attention.

Price

We’ll start with pricing because that’s usually where the curiosity starts. August year-over-year has median pricing up 3% in Oakland and 6.4% in Washtenaw County. Wayne is down -3.9%, but City of Detroit is tugging down the price of the surrounding suburbs with it’s median sales price of $80,000 in August 2023. Chart included below for all my fellow data nerds!

Inventory

New listings were down quite a bit in August, year-over-year. Wayne County was down -10.6%, Oakland -22% and Washtenaw a -19.3%. This means that Oakland County had more than 4,600 fewer homes hitting the market this year versus in August 2022.

The Months Supply of Homes is another indicator we look at to understand the market (if you’re fancy, it’s an “absorption rate”). Generally, 1-3 months of inventory is a seller’s market, 3-6 is neutral and 6+ months is a buyer’s market. At the county level, all the data falls into a “seller’s market”, with Wayne County the only one cruising toward qualifying as a more neutral market. However, we’ve got Detroit in there skewing the numbers from the ‘burbs.

The ‘Burbs

Drill Down into I-275 Corridor

For those of you interested in more granular stats on the Plymouth Twp/Canton/Westland/Livonia area, read on, with interest. I skipped City of Plymouth because I consider all data coming out of 1 square mile to be statistically insignificant. (The Mathematician is going to love that statement!)

Median Sales Price

The median price year-over-year is up in all four communities between 3.8-5.2%. Notably, Westland with the lowest median price saw the most growth year over year. This stat makes sense to me because as affordability erodes with higher interest rates many buyers start to look in areas that offer nice housing with a lower price point. Plymouth Twp has the highest median sales price at $451,250, up a whopping $56,250 (14%) from August 2021. Canton saw a similarly eye-watering increase in that time of $55,000 ($15.7%). The jump from 2022 to 2023 demonstrates the Fed is having its intended effect and the market is cooling . . . some . a little . . . maybe.

New Listings

The data for new listings here is similar to my Wayne County info. All the communities have fewer new listings year-over-year, ranging from -22.6% in my somewhat beloved Plymouth Twp to -27.3% in Canton. Canton’s new listing numbers are actually pretty drastic, down 33.6% compared with August 2021. This chart really hammers home that inventory has seriously dwindled since the pandemic craziness.

Inventory

The absorption rate remains abysmally low in these communities. Livonia had less than one month of inventory available in August. This means that if no new houses hit the market in September, there would be no homes to purchase in less than a month at the current pace of the market. Compare this to the 2.4 month supply we saw for inventory in Wayne County as a whole.

Days on Market

The last statistic I’ll leave you with is the Average Days on Market – how long a home sit before someone puts it under contract. This data was pretty flat at the county level, but it interesting in these I-275 communities. There is a noticeable uptick in how long a home is on the market before the sellers accept an offer. Plymouth Twp and Canton are up +5 days, Livonia +3 and Westland +6 days. A higher days on market also points to a cooling market, but 18-22 is still lightning fast when you compare it to historical data.

The moral of today’s story, children, is that clean, decluttered, staged and move-in ready homes are still flying off the shelf. Homes that need some updating and TLC may sit a little longer. Homes in a higher price point may also sit a bit longer as affordability is decreased for buyers.

Thanks for reading this week and, as always, reach out if I can be of any help to you!

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