Of the top ten cities in which the most people own homes, three are in Michigan and three are in Florida. Except for Nevada, these states are among those in which home values have dropped the most. They also have a high percentage of homes with underwater mortgages. These two factors are among the reasons that the average number of months that homes are on the market drags on well into years.
Monroe, Holland and Bay City, Michigan, are on the list of markets in which home ownership is high. The destruction of the car industry has made it certain the cities in the state with plants or towns in which people vacationed would be devastated economically and home sales would plunge. Homeowners can either default on their mortgages or hold out for higher prices. Some homeowners barely care about price. They plan to remain in their homes for years. Value is an issue left for another day.
Punta Gorda, Palm Coast and Oscala, Florida, are also on the list of the ten markets in which the largest percentage of people own homes. The real estate market bubbled in those cities as people relocated to the south. The recession curtailed that migration as it undermined demand and builders were left with tens of thousands of units of unsold inventory. That inventory has driven down prices and left the number of vacant homes available at unprecedented price. Low prices should help sales as low mortgage rates do. But, buyers are too concerned that prices have further to fall.
Home ownership is now an albatross in many parts of the country, particularly those in which there are no buyers.
Douglas A. McIntyre
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