Detroit’s housing market is working in overdrive to try and stay afloat amidst the troubling situation that continues to plague it.
The good news for the city — it is starting to see positive results for all its hard work.
But in the big picture, these marginal gains still have a long way to go in order for the metro area to ever be a top competitor in housing again.
When comparing housing markets only by year-over-year price percent changes, Detroit actually comes out as the hottest housing market, with a 28% increase of sold price change.
The problem is that the authors of the Pro Teck Valuation Services' Home Value Forecast pointed out that this isn’t an efficient way to compare housing markets.
"While Detroit has seen healthy gains this year, the Home Value Forecast rating system shows that Detroit is still a soft market," said Tom O'Grady, CEO of Pro Teck Valuation Services. "Although examining one indicator is helpful, it's important to analyze several home price indicators to best understand the health of a real estate market."
This chart shows what the top five markets would be when only the sold price percent change is compared.
Click to enlarge
(Source: Pro Teck Valuation Services)
Back at the start of the year, experts at Zillow (Z) posted a series of research pieces diving into what exactly is going on in Detroit, finding that not only is its housing situation stuck, but it is deeply troubling.
What’s interesting is that Detroit never really participated in the hoopla of the financial crisis. “But the lack of frenzy in good times did not protect Detroit from the bad times, with the subsequent national collapse in home values hitting Detroit as hard as any market, if not harder. And since then, while local housing markets around the country have gradually dug themselves out, Detroit has been stuck,” said Aaron Terrazas, senior economist at Zillow.
Instead, Pro Teck Valuation Services' Home Value Forecast uses a number of real estate market-based indicators to rank the single-family home markets in the top 200 CBSAs to highlight the strongest and weakest metros.
The ranking system is purely objective and is based on directional trends.
Click on the next page to see the actual list of top ten core-based statistical areas, along with the bottom 10.