Homeowners in so-called 'auto-wreck' states have trouble keeping up with payments; region leads nation in foreclosures.
By Les Christie, CNNMoney.com staff writer
September 12 2006: 10:01 AM EDT
NEW YORK (CNNMoney.com) — More than 250 bank-owned single-family homes, condos and duplexes in Michigan are going to hit the auction block en masse in late September, according to Hudson & Marshall, the company handling the auction.
The state's housing markets have been crushed by lay-offs in the auto industry. On Monday, Ford (Charts) was reported to be eyeing another round of cuts in its workforce. It has left many homeowners unable to keep up their house payments and lenders have built a big inventory of repossessed properties.
More than 92,000 homes entered into some stage of foreclosure nationwide this July – up about 5 percent from June and 18 percent higher than in July 2005, according to RealtyTrac, an on-line marketplace for foreclosed properties.
Michigan was one of the hardest hit of all the states, with a 25 percent spike from a year earlier.
Dave Webb, owner of the Hudson & Marshall, reports that the majority of the 250 Michigan properties primed for auction, about 150 in all, lie within 60 miles of Detroit. The rest are scattered throughout the state, including in the relatively rural Upper Peninsula.
Sellers are providing and paying for title insurance on all the properties, so winning bidders can be confident that the property should come to them free of back taxes, liens or other encumbrances.
The estimated prices run the gamut, from $15,000 to $450,000, and bidders will be able to see the homes and place bids online at http://www.hudsonandmarshall.com.
The troubles of Michigan's flagship industry have pounded real estate markets all over the state, as well as other Midwestern locales that have auto-dependent businesses.
According to the Office of Federal Housing Enterprise Oversight (OFHEO), of the bottom performing 20 metropolitan area housing markets in the United States, eight are in Michigan, and 17 are in the Midwest in other so-called "auto-wreck states."
Ann Arbor brings up the rear with a loss of 1.28 percent during the past 12 months. Detroit is fourth from the bottom with a loss of 0.61 percent.
Kokomo, Indiana, the third worst performing market, was one of the cradles of the auto industry (inventor Elwood Haynes first tested a horseless carriage there in 1894) and Daimler Chrysler is still a major employer.
Another Indiana auto and tire manufacturing center, Anderson, recorded a 1.1 percent decline in home prices in the 12 months ended June 30, the second worst performance in the nation.
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