The recent recession destroyed the nation’s economy in just about every sector. One of the most hard hit sectors was the real estate market which saw home prices plummet as a result of a variety of factors, including inflation and lack of jobs resulting in a decrease in home buyers. Economic problems in the real estate market were also apparent in the large number of homes in foreclosure. However, Michigan has recently been showing signs of a recovery in its real estate market.
The state has seen a dramatic drop in new foreclosures in August of this year compared to the same time last year. There were 1,849 new foreclosures started in Michigan in August 2013, which accounts for a 55 percent drop compared to August 2012. While the decrease in new foreclosures is dramatic, the state’s real estate market is still in poor shape. Michigan had the 11th most new foreclosures in the nation, while reporting the lowest median home price of $91,000.
On the other hand, experts are predicting that the state’s real estate scene will be picking up overall. Home prices are expected to increase by 3.3 percent in 2013. This can put a significant dent in the left over inventory from foreclosures during the recent recession. Also, Michigan is one of only a few states which are seeing less foreclosures than before the housing crisis. However, one must be careful, since there are still only 70,000 manufacturing jobs in the state, which is below the 2007 level.
Many people may still be experiencing financial hardships due to unemployment and continuing foreclosure cases in Michigan. However, there may still be some options for consumers with overwhelming debt problems. One option may be to file a personal bankruptcy which could help to discharge some debts while restructuring other debts in order to create a more manageable payment schedule.
Source: USA Today, States with the biggest drops in foreclosures, Paul Ausick and Michael B. Sauter, Sept.14, 2013