Metro Detroit luxury home sales rebound, but at bargain prices

Louis Aguilar, Detroit News staff writer

Sales of $1 million-plus homes in Metro Detroit are brisk again after two years of stagnation, according to industry analyses and local real estate agents.

But it's a painful recovery: Prices have been slashed. Sales have not returned to levels seen before the housing crash and economic recession. And most luxury houses have been on the market sometimes for several years.

Photos of metro Detroit luxury homes
New Pistons owner Gores seeks Detroit-area home

Examples of the discounts buyers have gotten or could receive on high-end homes in the past six months include:

A Bloomfield Hills home originally listed at $7.9 million sold for $1.7 million in January — a nearly 80 percent markdown. It was on the market for 3 1/2 years.

A Bloomfield Township house stayed on the market for 4 1/2 years before being sold in February at a 70 percent discount of $1.87 million.

In Grosse Ile, an estate formerly owned by the late auto aftermarket magnate Heinz Prechter was listed at $11.2 million in 2004. The current asking price is $5.2 million.

"People have succumbed," said Marie Sexton, a West Bloomfield Realtor for Re/Max Property Source. She has sold three $1 million-plus homes so far this year. It is common for sellers to cut half a million dollars off their original asking price, Sexton said.
"(Sellers) have admitted this is where prices are going to stay for a while — no more holding on for a price that you could have gotten a few years ago. It's time to finally sell. But also buy at an incredible bargain, too," she said.

In 2008, sales of million-dollar houses in Macomb, Oakland and Wayne counties plunged to 54 and 2009 wasn't much better with a total of 65 sales, according to statistics from Realcomp II Ltd., a Farmington Hills real estate information company.

Last year, sales improved 42 percent when 92 properties were bought. This was a marked contrast with overall home sales in Metro Detroit, which fell 8.6 percent in 2010 compared with the prior year, according to Realcomp.

Agents optimistic for 2011
So far through June of this year, 45 houses have been sold for $1 million or more in the three-county region, according to Realcomp. That's about the same as the 44 high-end homes sold during the same six-month period last year.

Several real estate agents said they hope more than 100 high-end properties can be sold in Metro Detroit this year, a number not hit since 2006.

"This year, we've got many more clients finally out looking again at properties, even compared with last year," said Ronni Keating, a Realtor with SKBK/Sotheby's International Realty in Birmingham.

"It's confidence in the economy, interest rates are at an all-time low, (and) prices are never going to be better."

The lion's share of sales activity of $1 million-plus homes is in Oakland County, where 83 high-end properties were purchased in 2010 compared with seven luxury homes in Wayne County and two in Macomb County, according to Realcomp.

"It's the same story. The auto industry has stabilized, and that means everything else is stabilizing," said Realtor Nanci Rands.

She and Meredith Rands Colburn, both associate brokers at Birmingham's Hall & Hunter Realtors, are "very, very busy this year," Rands said.

Many sellers have had their properties on the market for months.

For homes that sold for $1.5 million this year in Oakland County, the properties sat on the market for an average of 254 days, according to data provided by Sexton.

Amenities can drive sales
The average selling price of the Oakland houses was $1.8 million. The average listing price was $2.2 million.

This was a decline from 2010, when the average selling price was $2.3 million and the average listing price was $2.8 million, Sexton said. Average days on the market: 300 or nearly two months shy of a year.

In comparison, the median price of a home in Metro Detroit was $65,000 in June, the latest monthly data available, down 13 percent from a year ago, according to Realcomp.

When prices are competitive, what sells a luxury home are its amenities, Rands said.
"This is for people who enjoy a lifestyle that they can share with others," said Rands as she recently showed off a $4.2 million English Tudor home in Franklin Village. The amenities include a two-story library, multiple fireplaces, a wine cellar, swirling staircases, a pond with a fountain and a gym.

"Many of our clients have made the choice that they want to stay in the area," Rands said. "They can live comfortably."

Short Sales - What Can Go Wrong and How to Avoid Loss

By Evan Leo

While short sales inevitably form a part of most real estate investors' business models, they are laden with pitfalls that can be avoided or managed to make sure your real estate investing business does not suffer.

This article goes though what can go wrong with a short sale and how you can avoid loss to your business.

Short sales can create a lot of equity and profits and make good deals even better or create good deals from deals that were otherwise marginal or non-existent.

The following is a few things that can go wrong in a short sale

1) Short sales take time
Typically it takes two to three months for a short sale to be completed. Sometimes it can take much longer than you expect, sometimes as long as 6 months.
Do not be surprised if your file is lost, or the documents you send do not find your file for weeks. It is therefore important to be prepared for these delays and not have short sales as your primary source of income.

2) Rejected offers
As much as you may think your offer should make all the sense to the lender and that they should accept your offer, sometimes they just reject them.
This means you might have to go with their counter offer or increase your offer price. If the offer does not make business sense, you need to be ready to drop the deal.

3) Shaky sellers
It is not unusual to have your sellers develop cold feet to the short sale process. Lenders need a lot of information, including a statement of hardship where the seller explains the financial difficulty that forces them to be unable to continue making payments. Usually they may need to see proof income, bank statements, etc.
On top of this they may request for more information before they can make their decision.
Some sellers may get discouraged by this process and give up in the middle of the process. As the real estate investor, it is therefore important to explain to the sellers what is involved in the short sale, and the expected time lines and possible pitfalls that can be expected.
As long as they understand the process, they are unlikely to have a change of heart in the middle of the process.

4) Unable to close
You have an approval from the lender but your financing is not ready. Typically, banks will give you a time period within which you must close the deal.
If you are using private money or hard money to close the deal, it is important to make sure you have the process well ahead and ready to close if you get an approval.

If you are a realtor who has submitted a short sale offer to the lender on behalf of a buyer, it is important that you get the buyer scrutinize the property so they know exactly what they are getting for the money.
It is not unusual to a buyer back out or notice problems or repairs and requests to lower the price to cover them.
The bank may accept or reject such counter-offers, but being prepared can save you from this experience.
Successful real estate investing requires that you automate most of your tasks and increase efficiency to do more deals spending less time and money. Learn how you can run your business from a feature packed real estate investor website with numerous designs and features that make your work easier.

Article Source: http://EzineArticles.com/?expert=Evan_Leo
Article Source: http://EzineArticles.com/6385400

Buy a home at the Wayne County Tax Auction

MORE DATES ADDED!!!





People are cashing in on the Wayne County Tax Auction; and so can you. Buying houses at the tax action for $1500 or as little as $500 and selling them to families with poor credit for as much as $6000 to $12,000 on land contract. This is not wrong, but shouldn’t you be one of the people that bought the home at the tax auction for only $500? This can be you and with one of our FREE Introductory seminars you will learn how to do just that. We will provide an overview of the tax sale and explain the benefits of preparing early for the tax sale auction. You too can buy a home for as little as $500.







SEMINARS
Will be every Monday And Saturday in September :

Dates: Monday’s 6pm – 7pm
Saturday’s 11am – 12pm

Fro more information or to register:
Please call 313-340-3600
Or visit our web site at http://www.bid4detroit.com/

Hosted by: JCI Realtors 3845 W. 8 Mile Rd. Detroit, MI 48221
3 blocks east of Livernois across from the Fifth Third Bank

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