Sunday, February 15, 2009

Flint Michigan's Housing Boom: Sales Up +21%

From today's Flint Journal (no link available yet):

Yes, you're reading this right: Flint-area realtors posted one of their best sales years in more than a decade last year. Sales skyrocketed 21% over 2007, giving the Flint Area Association of Realtors its third best year in the past 14. The tally: a staggering 5,744 sales - nearly 1,000 more than the previous year.

6 Comments:

At 2/15/2009 5:07 PM, Blogger retire05 said...

Perhaps it would be informative to compare this housing "crisis" with the last one.
I personally benefited from the last housing "crisis". After selling a home in order to relocated to the neighboring town because it was smaller, my spouse and I found a small home that had been forclosed on a year before. It was a small historic home with great potential and not being afraid of the "sweat equity" we bought it for half of what was owed on it. That was 20 years ago. We improved it gradually (adding a HVAC system, new wiring, replaced the old cast iron pipes,) eventually adding almost 1,000 sq. ft to an existing 1,600 sq. foot home.

Our initial cost was $28,000. And as 20 years went by we had invested an additional $80,000. By the time we had lived in the home for 15 year (2003) the home was valued at $195,000.00. And while we are fortunate that housing values have not dropped in Central Texas, we are still in great shape.

None of this would have been possible had we not found a forclosed home to purchase. And I am seeing young married couples who have watched their credit now being able to buy a home the previously could only dream about at prices they can now afford. The technician at my vet's office just purchased a home of 2,700 sq. ft for $165,000. She found it on the HUD website. That comes to $61.00 a square foot, unheard of in these times.

The up side to this is that those who are now buying homes, taking advantage of forclosures, are getting more home for their dollar and are people who are meeting the new credit requirements that will allow them to afford the home and those buyers will be less likely to wind up in forclosure.

Keep up the great articles.

 
At 2/15/2009 5:19 PM, Blogger David Damore said...

Assuming a 6% fee on transaction price
Formula: Average Transaction * 6% * Number of Transactions = Total Realtor Fee Revenue

2007
$106,680 * 6% * 4,757 = $30,338,605.60

2008
$82,090 * 6% * 5,744 = $28,291,497.60

Total Realtor fees were $2,157,108 less in 2008 than in 2007. This represents a decline of 7.11% for Realtors to split and cover costs.

To put it another way, they had to close a lot more deals and still saw their business income decline. It is possible that per Realtor income or revenue went up depending on how many players entered and exited the business. The total pie got smaller but if fewer people are eating the pie, each person eating can have more food.


Thoughts?

 
At 2/15/2009 6:17 PM, Anonymous Anonymous said...

The total pie got smaller but if fewer people are eating the pie, each person eating can have more food.

If fewer people were involved, it means that their labor was freed up for more productive use. The increased production in other areas would have to be added to the "total pie" to determine if indeed it got smaller or just changed in composition.

 
At 2/15/2009 6:28 PM, Blogger marketdoc said...

For the fourth month in a row, Florida’s existing home and condominium sales also rose on a year over year basis in December. Statewide sales also increased over November’s figures in both the existing home and existing condo markets. Sixteen of Florida’s metropolitan statistical areas (MSAs) reported increased existing-home sales in December; 11 MSAs also showed gains in condo sales, marking the sixth month in a row that a number of markets have reported increased sales activity. Pending sales were also up again in many markets indicating stabilization continues to take hold throughout the state.

Washington better hurry to find a solution to the "toxic asset problem" before market activities correct the problem on their own.

 
At 2/15/2009 7:17 PM, Anonymous Anonymous said...

Washington better hurry to find a solution to the "toxic asset problem"...

The only "toxic assets" left after Washington is done will be U.S. treasuries.

 
At 2/15/2009 7:33 PM, Anonymous Anonymous said...

Sacramento: most January home sales THIS DECADE. Even more than the peak bubble years.

Homebuyers closed 1,542 escrows on resale homes in Sacramento County and West Sacramento in January, the most for a January this decade, the Sacramento Association of Realtors reported Friday.

http://www.sacbee.com/realestatenews/story/1624524.html

 

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