Magnolia Sprinkles...Springtime Brings Increased Activity to the West Michigan Housing Market

By
Real Estate Broker Owner with Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate
http://actvra.in/ySs

Magnolia Sprinkles

Spring has arrived early in West Michigan in more ways than one.  The Grand Rapids Association of REALTORS® released its' February 2012 Statistical Report which indicates that based on PENDING SALES, there is only 4.5 months of Housing Inventory available.  

Well, here's a Short Primer about Inventory Levels and how the Supply & Demand Curve impact your position as a Home Seller or Buyer.

 

BALANCED MARKET

A Balanced Real Estate Market (aka as a Transitional Market) refers to a market which has approximately 5-7 months of home inventory supply available.  You will often hear agents reference 6 months as the mid-point of a Balanced Market.  This level of economic activity reflects a time in which neither the Home Seller or Home Buyer is adversely impacted by supply and demand issues and the playing field can be considered somewhat level.  The reference to the transitional nature of this type of market is that the situation is more like a see-saw, which will eventually tip in favor of one side or the other. (Buyer vs Seller's Market)

 

BUYERS' MARKET

Should the see-saw mentioned previously flip to the right, Inventory levels would begin to rise precipitously above the 6-7 month level.  The rise in the supply of homes available means more competition on the market for Home Sellers who eventually will need to lower their prices or give more concessions to secure a sale.  In 2008, Inventory levels in West Michigan rose to approximately 14 months of supply overall in West Michigan due to the Housing Crisis and the increase in Distress Sales.  Buyers in the market place at the time sometimes secured homes at far less than 50% of their value in a Balanced Market.

 

SELLERS' MARKET

When housing Inventory levels dip below 5 months Supply as they have in February 2012, the Market has clearly transitioned into a Sellers' Market.  Based on Pending Sales, we would run out of homes to sell in less than 5 months!  Amazing, especially when you consider how long we've heard all sorts of harsh statistics about the demise of the housing industry.  

 

SUMMARY

In closing, here are a few more numbers which are helpful to know if you're deciphering what you need to do to respond or react to today's real estate market.  We're seeing an significant increase in home prices based on Pending Sale activity.  

The average Pending Sale is approximately 15% HIGHER than this time last year at just under $126,000.

So, if you've been sitting on the fence, now's the time to jump off and buy a home while supplies last or put your home on the market and take advantage of the upswing in activity.  Please contact Audu Real Estate at 616-791-0511 for information on any home for Sale in West Michigan.

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Location:
Michigan Kent County
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Greater GRAND RAPIDS, MI Real Estate
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Michigan Real Estate
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Tags:
2012 grand rapids housing
luxury home prices in west michigan
home selling
home buying
supply and demand
west michigan housing market

Comments 12 New Comment

Rainmaker
373,183
Lola Audu
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Michael...thanks for stopping by to read and comment.  Thankfully, things are transitioning and we're seeing good sustained growth in a number of sectors including some elements of our commercial real estate marketplace as well.

March 28, 2012 01:53 PM
Rainmaker
373,183
Lola Audu
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Morgan, We're more than ready for that! :)

March 28, 2012 01:54 PM
Rainmaker
373,183
Lola Audu
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Sandy...we're seeing a lot of early blossoms around here.  Thanks for your comment.

March 28, 2012 01:55 PM
Ambassador
1,756,255
Jeff Dowler CRS
Carlsbad CA Homes for Sale (760) 840-1360
Solutions Real Estate

Lola

We are seeing transitioning markets all over the country it seems, and I suspect that will continue. But we should also expect to see an increase in foreclosures hitting the market with the completion of the Mortgage Settlement Act. Hope your market continues to be a vibrant one.

Jeff

March 28, 2012 09:25 PM
Rainmaker
373,183
Lola Audu
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate

Jeff, it will be interesting to see what happens with for foreclosure situation.  I think that our lending institutions are coming to terms with the fact that the way in which they have historically handled this issue has resulted in huge losses and are looking for alternatives.  I will be watching the new pilot program just launched by Bank of America in which foreclosed properties will be turned into rentals and ultimately over to management by potential investors closely.

March 29, 2012 06:00 AM
Rainmaker
373,183

Lola Audu

Audu Real Estate~Grand Rapids, MI ~Welcome Home!
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Additional Information

Grand Rapids, Michigan real estate information including houses for sale, rent and home buyer/seller tips. Also includes wisdom and insights from Lola Audu, CRS Associate Broker.

Grand Rapids, Michigan Real Estate
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