Article Written By: Sherri Calcut | SVP Mortgage & Consumer Loan Manager | Mercantile Bank of Michigan
A recent Fannie Mae survey shows confidence in selling a home climbed to 23% in January, up from only 11% in January 2012. There are signs West Michigan is doing even better. Houses are being built and put up for sale around the region. Falling inventories are both a positive and negative factor for our recovery. They have pushed prices higher, which helps underwater homeowners, but have also created a shortage of homes for potential buyers. The inventory of homes for sale remains 28.9% below the levels seen in January of 2012. With fewer distressed properties and underwater homes, more home sellers in 2013 will be persuaded to place their homes on the market and move up. Local West Michigan Realtors have seen a significantly lower supply of inventory with an average month’s supply nearing 3 months in many areas. As the inventory issue works its way back to a traditional balance, the housing market should continue a robust recovery during 2013.
Residential construction expects its brightest year in nearly a decade. The residential market rebound should grow by more than one-third this year, according to the Home Builders Association of Michigan. With record low new home production for the past several years, pent-up demand is finally beginning to burst through the marketplace. There are several factors being cited for the new construction rebound, including a dearth of available homes on the market, increased hiring, low interest rates and a new consumer mindset as people return to work and gain confidence they will continue to have a job. The law of supply and demand will encourage buyers to take advantage, and there is still plenty of time before inventory is replenished to the industry average of a six months supply of desirable homes on the market.
In effort to help foster new home purchase activity, Michigan State Housing Development Authority (MSHDA) currently has a Homebuyer Assistance Grant Program available for the purchase of a single-family, owner occupied, principal residence. This program supports both non-military and military Homebuyers. Homebuyers are eligible for up to $3,000 in grant money not to exceed 25% of the sales price. There is no lien and no repayment is required. There are no income limits, however the Homebuyers must not have purchased or refinanced a principal residence in the last 3 years from the date of the new home being purchased.
If you have any questions feel free to contact our Mortage Lending Team.