Record numbers of Detroit home foreclosures have made the Michigan city the second most affordable to buy a home among U.S. cities as of the first months of 2010, based on a ranking by CNN.
In the final quarter of 2009, the median home sales price in Detroit was $86,000, substantially down from the $145,000 median in 2005. Nearly 94 percent of all houses sold in the last quarter were affordable to many families in the city, where the median household income is $57,100.
The CNN affordability score of Detroit is 93.4 percent, just 2.3-percentage points below the 95.7-percent score of Indianapolis, the most affordable city.
In 2009, more than 69,000 homes in the Detroit metro area received delinquency or foreclosure notices, according to a California-based foreclosure tracking company. The number represented 3.6 percent of all housing units in the area and marked an increase of 0.36 percent from postings in 2008 and a jump of 10.2 percent from filings in 2007.
Detroit lost record numbers of its housing units to foreclosure home listings after suffering record numbers of record job losses when its auto manufacturing sector collapsed. In December last year, its unemployment rate hit 14.9 percent, almost 5 percentage points above the national average jobless rate.
Detroit home foreclosures also contributed to the record rate of home foreclosures in Michigan in 2009. More than 118,000 households in the state went through delinquencies or foreclosures in 2009, representing 2.6 percent of all households in Michigan. The number marked an increase of 11.5 percent from filings in 2008 and a jump of 35.6 percent from filings in 2007. Compared to other states, Michigan ranked eighth based on rates of foreclosure.
Because of continued job losses, the foreclosure problem in metro Detroit has spread into the more affluent neighborhoods. In Lake Shore, where top auto executives once enjoyed their lives in luxury, homes which were once priced above $1 million have been left vacant after foreclosure and are now being sold at less than half what they were once worth.
According to broker Kent Colpaert, the last high-end home sold in Grosse Pointe Park was priced at only $465,000. Detroit homeowners with loans above $1 million have been defaulting at a higher rate than owners of regular homes because of losses in the stock markets and the loss of high-paying jobs.
Indeed, the pace of Detroit home foreclosures, largely driven by the bankruptcy of major manufacturing companies, also swept the wealthier families who should have been stronger in weathering the downturn.
Author Resource:-> Original Post: Detroit Home Foreclosures Made City Second Most Affordable on ForeclosureDeals.com.
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