The article goes onto cite Detroit and Grand Rapids as two particularly hard hit markets, and Kalamazoo could be added to that list. It seems like Michigan never catches a break, economically speaking.
The conclusion is one of the more cogent statements of where housing policy and economics went wrong and what has to be done to keep things in better line as the economy recovers. The Great Recession is compared to the Great Depression in that it is a turning point: things simply can't go back to 'the way they were.'
When you collected tax data, how much had your properties fallen in value? And how common were sales since 2006 or so, when the crash started?
There wasn't a lot of price movement in the neighborhood my group visited. Houses seemed to have fallen around $4000 from there price in 2008. Most of these homes had an accessed value of $50k so we are looking at roughly an 8% decline in their value.
ReplyDeleteAs for sales since 2006 there were a few but nothing out of the ordinary I would think. The neighborhood seemed to weather the downturn fairly well.
I'm surprised by that number too, our neighborhood in the Portage area had houses that sold for $80,000 in 2001 and are now appraised at $40,000 so I definitely noticed the 50% decline also.
ReplyDeleteI like how this article focuses on the positives though, and the new role housing will take. We'll see how prices keep changing in the future I guess!
Remember that the assessed value is 50% of the homes actual value so if the sales price was 80k the assessed value at the time would have been 40k. Thus if its assessed value today is 40k it would not have lost any value to its sales price of 80k in 2001. At least that's how I think Dr. McKinney explained it to me. Correct me if Im wrong.
ReplyDeleteYes on average housing prices only fell 18.5% however there are some locations that have held their value very well. Sadly the most relatively desperate areas are the ones who's values plummeted. Chris is correct in his reasoning about assessed value of the home being only half of the sale value. The housing market needs to transform into something that is sustainable for the future and I believe this it is getting towards that goal.
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