SEPTEMBER MARKET REPORT

Hi there~

The September market continued to follow the same post tax credit pattern with continued falling available home inventories and a relatively strong sales pace. In terms of historical numbers, sales dropped compared to 2009, but remember 2009 was getting near peak tax credit activity, so even coming close is pretty good. The more relevant comparison is pre tax credit 2008, which we were ahead of. Available home inventories for the Metro Detroit market remain at a 3 year low, another good sign. The rest of the state has not yet seen the same declines but their inventories did not rise as high either. In general, the Southeast Michigan market is the healthiest in the state and one of the most active in the country. The rest of the state should follow, since most depend on SE Michigan to some degree.

Foreclosure moratoriums by many of the major banks have been the hottest industry news. In general, the major banks have found enough issues with their foreclosure process that they have stopped taking possession of homes and in many cases are taking their homes off the market. It is too early to tell if this is a 30-day or 6 month issue. Their action will further shrink the available housing inventory so it may have a short term positive market effect, but the reality is the sooner the bank inventories are moved through the market, the faster we will get to a permanent improving market.

With fewer bank owned homes on the market to compete with, the moratorium does offer a short-term opportunity for sellers to get a value boost (not so much appreciation, but a price a bit closer to typical asking prices) by putting their homes on the market now.