Wednesday, October 10, 2012

Vacation home market picks up in Michigan

Michigan vacation home  sales are rising as an influx of Southerners and East Coasters competes with Midwestern buyers for properties after awakening to the lure of summering in the Great Lakes State.
This is the second straight year that real estate agents in the northern Lower Peninsula have reported improved second home sales.
Industry players said a slowly recovering Michigan economy, the state's marketing campaign and glowing media reports about the area have lit a fire under the vacation-home market stretching from Manistee to Mackinaw City. It comes as National Association of Realtors Chief Economist Lawrence Yun predicts a nationwide uptick in vacation home sales.
Sales representatives said in 2011 that areas like the northeast counties atop Michigan's Lower Peninsula still reeled from foreclosures and dropping prices. This year, prices are slow to rise because homeowners and Realtors in Traverse City, Charlevoix and other parts scattered around Michigan's "little finger" on Lake Michigan are still clearing homes and condominiums with depressed prices.
Carla Houle and her husband John Libbe just bought a four-bedroom house called Chimney Ridge in the Homestead for about a half-million dollars — down from its asking price of nearly $900,000 four years ago. The 2,300-square-foot, open-plan house is tucked into the woods and has a view of Glen Lake a few miles away.
"Interest rates were down; the house price was down; it was just a good time," said Houle, a Xerox sales executive, whose husband Libbe helps run a family-owned local construction company.
Interest rates are at record lows, helping to boost home sales — though lending conditions have tightened. Freddie Mac reported Thursday that 30-year, fixed-rate mortgages this week averaged 3.4 percent.
About 20 miles to the southeast on the eastern shore of Sutton's Bay, Texans Craig Chick and Kate Wessels Doner are packing up for the Lone Star State again after enjoying the summer life on the Leelanau Peninsula. They bought a cottage with some out-buildings "pretty close to the market low" in June 2011, Chick said.
The couple, parents of two, already have enhanced the place with a stone beachfront patio and other improvements.
National media attention also has helped. ABC's "Good Morning America" chose the Sleeping Bear Dunes on Lake Michigan as "the most beautiful place in America." And TV chef Mario Batali, a Sutton's Bay resident, sings the area's praises.
Traverse City has a higher national profile in part because of the rise of Michael Moore's annual film festival, which this year attracted an appearance by actress Susan Sarandon.
Last year, vacation home sales nationwide increased 7 percent from the year before, while the average price fell 19 percent to $121,300, according to a National Association of Realtors survey. More precise vacation home sales aren't kept because buyers don't identify in a real estate sale how they will use the property.
All-cash purchases continue to play a prominent role up north. The stock market  rebound is giving families with plenty of money a chance to scoop up second homes, NAR's Yun said.
"There's always cash available out there; this is America," Platt said. "And based on the hysterics of the last five years, people with money keep watching, and they get to the point where they say, 'Prices aren't going to get much lower.' And that is now."

From The Detroit News:

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