DETROIT (WWJ) – If you’re a homeowner whose mortgage is underwater, you have a lot of company. WWJ’s Rob Sanford reports property values in metro Detroit continue to fall.
The Southeast Michigan Council of Governments annual report found that property values fell 6.5 percent this year. That figure is actually less than the 9.5 percent predicted by SEMCOG a year ago. Taxable value fell 6.1 percent for residential property and 7.4 percent for non-residential property.
According to the report, state equalized value fell by 7.3 percent for residential property and 11 percent for non-residential property, leading to a total decline of 8.3 percent. The losses reflect the bursting of Southeast Michigan’s real estate bubble that started in 2007 and continues to decline.
About 35 percent of all mortgages in Michigan are more than the properties are currently worth. At the peak in 2008, Michigan residents, on average, were in debt for more than $41,000. About 70 percent of this debt is tied up in mortgages.
But, the numbers are improving. In 2010, the total debt for each Michigan resident fell to about $36,000 and mortgage debt fell to about $25,600.
Foreclosures are helping to keep home prices low. SEMCOG estimates that one in 38 housing units in the region is in foreclosure.
SEMCOG says the market won’t bottom out for a few more years.
To read the full community fiscal capacity report, click here.