'It's frustrating.' Metro Detroit housing market continues to be tough for buyers

Posted at 5:27 AM, May 20, 2022
and last updated 2022-05-20 11:36:29-04

(WXYZ) — If you're looking for a house, chances are you've made multiple offers and still may not have found anything. On top of that, prices keep going up.

But, could the housing market be cooling off a bit? I asked Jeanette Schneider, the President of RE/MAX of Southeastern Michigan, what she expects to see when it comes to home prices this summer.

"I see them going up, and I see them going up by smaller percentages. I guess some of that some of it's going to depend on how much more the Fed moves interest rates," Schneider said.

Home sale prices in metro Detroit are up 8% over last year, according to the latest RE/MAX of Southeastern Michigan housing report.

In our area, Livingston County saw the largest jump in home prices – up 12.3%, followed by Macomb County with prices up 11.4% compared to April of last year.

The City of Detroit had the biggest increase with median home prices up nearly 20% over last year.

That's great news for sellers who are seeing their home values increasing, but tough for home buyers in a market dealing with low inventory.

Schneider said if the Federal Reserve raises rates again, as it has indicated it will, that will have an impact.

“Some buyers are going to be priced out of the market. Some buyers are going to have to adjust what they what they look for," she said. "I think we're going to also start to see buyers offering more close to asking [price] than wildly over asking price.”

Nicole Rivera of Davisburg is a first-time homebuyer. She said her experience has been frustrating.

The wife and mother of four has been looking for a home around the Clarkston area since January. She said there will be 5-to-10 other offers on houses they bid on.

Also, her husband is a veteran, so they are pre-approved for a VA-backed purchase loan with no down payment requirement. But the bidding wars keep driving up the price.

“Like $25,000-to-$40,000 over. It's like, how is anybody supposed to be getting anything with that?" Rivera said.

According to Schneider, there are also more foreclosures on the market than what we've seen over the past couple of years, but much of it is from a backlog of what was in the system before the pandemic hit and before the federal foreclosure moratorium.

"Do you feel like you're going to be able to find something before the end of the summer?" I asked Rivera.

"No, no. But we're we're going to keep looking," she said.

Rivera also said her family is considering cutting down on their "must-have" list — instead of a 3-bedroom-2-bath house looking for a 3-bedroom-1-bath or 1-and-a-half-bath house.

Schneider recommends that you refine your list of "must-haves," get pre-qualified for a mortgage so you can move quickly (and know what you can afford), and consider offering the seller an extra two weeks or a month in the home after closing if they need time to figure out their next move.