H OUSING N EWS R EPORT
April 2016
“What both Porter Ranch and Flint show is that sales volume is affected by incidents that affect the way a person can use and enjoy their property,” said Lipscomb, noting that the much more dramatic drop in Flint home prices may be due in part to an issue that is much more quantifiably dangerous for the health of residents. “The lead contamination has an immediate and oftentimes permanent impact on a person’s use and enjoyment of their property.” The 21 percent drop in Flint home prices in 2016 reversed the trajectory of home prices in the city of Flint, which increased on an annual basis in the previous two years, and despite the sharp year-over-year decrease are still up 90 percent in the first two months of 2016 compared to the same time period three years ago in 2013. “Our last four or five years have actually been quite good,” Theodoroff noted. “The economy is coming back slowly but surely.” The economic recovery in Southeast Michigan has come as the auto industry — and all the ancillary and supporting industries around it — have started to bounce back from the Great Recession, according to Andy Sussex, Principal Broker and Owner with Castle Real Estate, covering parts of Genesee County along with parts of Oakland and Macomb counties in the Detroit metro area. Continued Next Page
when high lead blood levels were discovered among Flint children — leading to the declaration of a public health emergency by the Genesee County Health Department in October 2015 and Michigan Governor Rick Snyder declaring a state of emergency in January 2016, according to a timeline of the crisis compiled by the Detroit Free Press . The impact on the Flint housing market: a nascent real estate recovery in the city of Flint that abruptly reversed course in early 2016 after the crisis escalated. Median home prices in the city of Flint dropped 21 percent in the first two months of 2016 compared to the first two months of 2015 even while median home prices countywide increased 8 percent during that same time period, and median home prices statewide in Michigan were up 18 percent during that same time period. Nationwide home prices were up 8 percent for the first two months of the year. The real estate trends following the environmental crises in both Porter Ranch and Flint demonstrate that these types of crises do impact housing, if in varying degrees based on the nature of the crisis and the nature of the local housing stock and underlying economic fundamentals, according to Cliff Lipscomb, director of economic research at Greenfield Advisors, an Atlanta-based economic and real estate research firm. Recovery in Remission
SOURCE: RealtyTrac
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