Understanding Real Estate Inventory Trends in Michigan

At Coldwell Banker Town and Country Real Estate, serving Livingston and Oakland Counties and the entire state of Michigan, we’re dedicated to empowering our clients with clear, local insights about the housing market. National headlines are buzzing about “rapidly growing unsold real estate inventory” across the U.S., but what does this mean for Michigan residents, particularly in areas like Southeast Detroit or beyond? Real estate is hyper-local, and Michigan’s market dynamics differ significantly from the national narrative. Let’s dive into the details to help you make informed decisions, whether you’re buying, selling, or simply curious about the market.

The National Picture: A Surge in Unsold Homes

Nationally, unsold housing inventory has risen by approximately 27% year-over-year, reaching about 959,251 active listings by April 2025. Over 54.5% of homes sat unsold for 60 days or more in November 2024, the highest since 2019. High mortgage rates (around 6.5–7.5%) have dampened buyer demand, while new construction and regional factors have increased supply in certain areas. The states driving this inventory growth include:

1. Florida: Inventory has surged (e.g., +51% in Cape Coral, +48% in North Port-Sarasota) due to skyrocketing insurance costs (averaging $11,000 annually), hurricane risks, and rising HOA fees from new condo regulations. Overbuilding during the pandemic has also created a surplus.
2. Texas: A 30% inventory increase stems from aggressive construction and high property taxes, turning markets like Austin into buyer’s markets with prices down 30% from their peak.
3. Colorado: Metro Denver’s inventory jumped 67.3% year-over-year, driven by high HOA fees, unaffordable condos, and a spike in new listings.
4. Arizona: A 70% inventory rise reflects overbuilding and affordability challenges, with high insurance and tax costs deterring buyers.
5. Idaho: Markets like Boise are seeing excess inventory from a post-pandemic demand slowdown and new construction outpacing buyer interest.

These Sun Belt states face unique challenges—climate risks, overbuilding, and non-mortgage costs—that don’t apply uniformly nationwide. But what’s happening in Michigan, from Southeast Detroit to the Upper Peninsula?

Michigan’s Market: A Tighter Landscape

Unlike the Sun Belt, Michigan’s housing market, including Livingston and Oakland Counties and other regions, remains significantly tighter than the national average. Statewide, inventory is still well below pre-2019 levels due to the “lock-in effect.” Many Michigan homeowners secured low mortgage rates (3–4%) during the pandemic and are hesitant to sell, as trading up would mean facing rates near 7%. This keeps inventory low and competition high for buyers across the state.

In Southeast Michigan’s Livingston and Oakland Counties, the median home price in September 2024 ranged from $350,000–$400,000, far below national hotspots like California ($886,560) or Florida ($412,200). Local inventory remains constrained:

• Livingston County: Active listings are down 10–15% compared to 2019, with homes selling in an average of 30–40 days in early 2025.
• Oakland County: Inventory is about 20% below pre-pandemic levels, with high-demand areas like Rochester and Troy seeing homes move quickly due to limited supply.
• Statewide Trends: Similar patterns hold in other Michigan markets, such as Grand Rapids and Ann Arbor, where low inventory continues to favor sellers, though rural areas like the Upper Peninsula may see slightly longer days on market due to lower demand.

This low inventory keeps Michigan’s market tilted toward sellers, even as national reports suggest a broader slowdown. For buyers, this means acting decisively, while sellers can still command strong prices, particularly in high-demand areas.

Why the National Narrative Doesn’t Fit Michigan

The national “inventory surge” story doesn’t align with Michigan’s reality due to several key factors:

• Limited New Construction: Unlike Florida or Texas, Michigan hasn’t experienced a construction boom. New home development in areas like Livingston and Oakland Counties is steady but modest, avoiding the oversupply seen in the Sun Belt.
• Affordable Costs: Michigan homeowners face lower insurance costs (around $1,500–$2,000 annually) compared to Florida’s $11,000, and HOA fees are less prevalent or burdensome. This stability reduces the pressure to sell.
• Stable Demand: While Florida sees out-migration due to affordability challenges, Michigan benefits from steady local demand and some in-migration, particularly in vibrant communities like Brighton, Birmingham, or Grand Rapids.

What This Means for You

For buyers in Michigan:

• Expect competition, especially for homes priced under $400,000 in areas like Livingston, Oakland, or Grand Rapids. Multiple offers are common due to low inventory.
• Partner with your Coldwell Banker agent to stay ahead of new listings and craft competitive offers.
• Get pre-approved to strengthen your position in a tight market.

For sellers:

• Your home is in high demand, but pricing strategically is critical. Overpricing can lead to longer days on market, even in a seller-friendly environment.
• Highlight your property’s strengths—whether it’s proximity to a vibrant downtown in Rochester, the charm of Brighton’s community, or the natural beauty of Northern Michigan.
• Our team can help stage and market your home to attract top offers.

For investors or first-time buyers:

• Explore emerging markets across Michigan, from suburban Oakland County to up-and-coming areas in West Michigan or the Upper Peninsula, where new developments offer opportunities without oversaturating the market.
• Keep an eye on potential mortgage rate declines (possibly to 6.5% by late 2025), which could increase demand and tighten inventory further.

Trust Coldwell Banker Town and Country Real Estate

At Coldwell Banker Town and Country Real Estate, we’re proud to serve not just Southeast Michigan’s Livingston and Oakland Counties but communities across the entire state. The national narrative of overflowing inventory doesn’t reflect Michigan’s reality, where low supply and strong local demand create unique opportunities for buyers and sellers alike. Our experienced agents are here to guide you through every step, whether you’re selling a family home in Troy, buying your dream property in Traverse City, or exploring investment opportunities in Grand Rapids.

Ready to navigate Michigan’s market? Contact us today at our Brighton or Howell offices, or reach out to our team anywhere in the state. Let’s make your real estate journey a success, wherever you are in Michigan!

Disclaimer: Market data is based on industry reports and trends as of early 2025. For the latest insights, consult with your Coldwell Banker agent.