September proved to show a long anticipated increase in real estate activity in Northwest Michigan. Buyer activity has been trending upward after a lackluster summer season, and we’re driving into the fall with a lot of offers being written and properties being put under contract.

The number of residential sales for September we up 31% over 2008- actually they were the best they’ve been in the past 4 years. This has been driven by the downward adjustment in sale prices. Buyers flocked to those listings where the prices had dropped in concert with the regional market trend. Median price as compared to the prior year was down about 11%, which is on par with year to date figures as well.

Overall, we’ve seen home prices decline just under 21% since their peak in 2005/2006.

Home Sales Rebound in Northwest Michigan, September 2009

Value leaders have been in the low and middle ranges- you’ll see in the chart below a sharp increase in the number of sales under $40,000 (WHAT! A house in NW Michigan for under $40,000? Yep.) That trend is reflected up into the midrange, with gains up through the $180,000 range.

Home Market Price Analysis for Northwest Michigan, September 2009

Where we’ve fallen off is at the higher end, made up primarily of waterfront/vacation homes. Many of these sellers are either insulated from the economic pressures of our current economy, or have just not come to terms with the effect that the overall market has had on their values. While waterfront properties have suffered much less exposure to price erosion, the lack of transactions indicate that the buyer population is waiting for adjustment to take action. There are some exclusive enclaves (such as Crystal Downs on Lake Michigan) where little if any depreciation is occurring, but what we’ve seen on other lakes is that only those properties that have made adjustment are selling.

We continue to have some very good values, but the best deals get picked off very quickly, and as inventory continues to tighten, we’ll see increased competition for these listings. Multiple offers are already common, and by all indication this trend will continue.

Fall brings fish into the rivers of Northwest Michigan, first Coho and Chinook Salmon, and later Steelhead. Enthusiasts travel long distances to enjoy the action and the beauty of the region. One of my clients is a river guide, and had a group coming in from North Carolina last weekend.

One of the best know locations among fisherman and tourists alike is the old Homestead Dam site on the Betsie River, just East of Benzonia. Here the fish stack up before making their way through a fish ladder at the dam. It’s entertaining to watch these big fish jumping up river from one level to another. [youtube=http://www.youtube.com/watch?v=TjHILkFDauQ]

Just upstream from the dam is The Homestead Resort on the Betsie, which features 11 units, a home with office, about 330 feet of river frontage and about 18.5 acres of land. This resort is being offered for sale by a local bank, and they’ve just reduced the price to $395,000. It is a cool opportunity for someone who wants to do their own thing, has a love of the outdoors and a friendly personality. Additionally, the resort was previously approved for condominiumization, or division into 12 separate units for individual sale. Often these types of projects are sold out, with the individual owners continuing to offer their units for rental through a manager.

The fishing has by most accounts been very good the past two years. This year had ebbs and flows, as a long period of warm dry weather in September slowed the fishing for a while, however it has taken off again with recent cooler weather and rain. Some great fish have been taken, and just south of us a world record brown trout was pulled from the Manistee River.