Source: Sherman Publications

Demand for medium-priced homes growing

by David Fleet

February 01, 2012

Too few medium-priced homes for sale has started to inch up area real estate prices.

According to Realcomp, a Farmington Hills-based multi-listing service that provides data for the real estate market, the median price of a home sold in Brandon and Groveland townships increased from $129,950 in 2010 to $139,925 in 2011. The bump up in prices caused home sales in both townships to drop from 224 units sold in 2010 to 176 sold in 2011, according to Realcomp.

“It’s simple— sales are down by 48 homes because we just don’t have the homes on the market to sell,” said Abby Hotchkiss of Real Estate One, 875 S. Ortonville Road, Ortonville. “The middle market homes are just gone right now.”

“I don’t have enough properties for a variety of reasons,” said Hotchkiss. “A lot of people are upside down on their homes and they may want to sell, but just can’t right now—they are just holding on to their homes. Most of the time these homes are also overpriced. People get the idea if their home was worth $250,000 five years ago they can get that amount now. It’s just not going to happen and you’re going to lose buyers.”

Upper-end homes, those priced more than $250,000, are out there, but there are just few to sell, said Hotckiss.

“Many people are not getting financed for as much money as before,” she said. “Therefore the upper-end homes will sell, but not as fast.”

The price on the medium priced homes has increased because of supply and demand, added Hotckiss.

“There’s competition among buyers for the homes in the $120,000 to $140,000 price range— that’s moving the price up,” she said. “Buyers are snatching those homes up right away.”

“We are looking for some of the homes on the market after the MERS issue is cleared up also.”

MERS is the Mortgage Electronic Registration Systems. Created in about 1993, MERS is a private company that allows banks to buy and sell mortgages without registering the transfer with the home county. MERS saves banks huge expenses in the paperwork of mortgage management.