LANSING, Mich. —
Most of us have been spending a lot more time at home this past year.
But folks looking for a nicer place to ride out the pandemic have run into a problem: Home prices in mid-Michigan are way up and the competition among buyers is pretty fierce
The average sale price for a home in mid-Michigan in the first months of 2021 was $21,840 higher than it was at the start of the pandemic, an increase of more than 12%, according to sales statistics released by Berkshire Hathaway HomeServices Tomie Raines REALTORS.
"It's gotten kind of like the Wild West of real estate out there," said Brian Huggler, an associate broker at Coldwell Banker Hubbell BriarWood.
Which would make Huggler a regular cowboy.
Huggler has been selling homes in mid-Michigan since 1991.
He said his listing board has the smallest number of homes that have ever been on it.
The increase in prices is "mostly the low inventory," Huggler said. "We have more buyers than sellers. There are people out there that want to sell their houses, but in turn, where do they go?"
The shortage of homes is due to a surplus of people wanting to buy better houses during the stay-at-home orders and a rise in the cost of lumber.
"What’s happening is that for example, the cost to build a new house right now is $24,000 more than it was a couple of years ago for the same house, just because of the cost of the lumber," Huggler said. "So what's happening is a lot of buyers are not, you know, building houses just because builders can't get the materials. It's putting a lot of pressure on the existing market."
Home prices in mid-Michigan reflect those challenges.
In Williamston, the average sale price rose by 31.8 percent. In Grand Ledge, they rose 28.5 percent. In East Lansing, 23 percent.
Asked if he feels the market is peaking, Huggler said, "Boy, I sure hope we are because I can't imagine that it could get more competitive than what it is right now. I mean, to have a buyer right now, you're really scrambling trying to find suitable housing for them."
Huggler believes the market will calm down.
"I think that as more building comes online to satisfy part of that demand, you'll start to see things ease a little bit," he said, "but I don't think it's really a bubble that's going to burst as it did 10 years ago."
As far as when that cool down will take place?
"I would hope that, by this time next year, we're a little bit back to more normal," Huggler said. "I think it's still going to be a strong market based on everything that I'm seeing and reading and listening to, but I think within 12 months, once things calmed down a little bit, I think the market will calm down a bit too."
In the meantime, buyers will just have to be creative.
James Gambrell, one of Huggler's recent buyers, used an escalation clause to score his mid-century modern home, but many buyers are having to get much more creative.
"I had an agent write an offer on a listing that I had, and she offered to bake the seller cupcakes. I'm not kidding," Huggler said.
If you are looking to buy this summer, this mid-Michigan real estate agent has one top piece of advice.
"Try to be patient. You’re going to be heartbroken, you're going to probably lose out on a house," Huggler said. "But one thing in 30 years of doing this that I've seen is that it does always work out if you can just be patient. You will find a house."
For sellers it's a fantastic time to get your house on the market but remember, most sellers ultimately become buyers.