Is it good time to buy a home?

Real estate market isn't a good time to buy a home right now. We're in the fall and getting ready for winter. But there's a lot being said about home prices, mortgage rates, and so much more. I want to bring in my good friend here, Michael Perna, who's joining us now in the studio. I should say our new set. The new set. How do you feel about this? This is a little different. I feel exposed out in the open. Yeah. Well, you know what? I do. So we did this so that if there's breaking news or anything happening, we can all communicate and bring it to everybody. Oh, that's incredible. Yeah. That's such a great idea. Yeah, raw breaking news. I really like the new set setup. Thank you. And thank you again for having me. I appreciate it. Of course, of course. So we're talking real estate. Is it the time? It feels like a terrible time to buy. Interest rates going up a full point in the last 60 days. We just saw the inflation report come out ticking up to 3.7%, which of course affected the stock market and everybody's retirement accounts. That didn't feel good for me when I opened up the app and looked at it. It feels like a super rough time. However, there is a silver lining. Right now, home prices are being reduced at the highest amount they've been reducing in the last couple of years. So Redfin put out some data recently showing that around a quarter of all home sellers are actually reducing their price, which is the first time we've seen that since pre-COVID. And then the second thing is another Redfin report is showing that almost half of all home sellers are giving some sort of a concession on the home sale. Now, that could be as small as a home warranty. It could be as large as paying down points. So an interest rate goes from a seven and a half down to a six and a half. So now is actually a very good time for buyers to not have to compete with other buyers and get a really good deal. If there is less competition, does that mean homes are not staying, or they're staying longer for sale? So there's a lot more time to think about whether or not you want to actually jump in. So you can actually think about whether or not you want to buy the home. Now, good homes are still getting multiple offers. We're still seeing 10 to 15% of the market can get two or three offers. sometimes four offers, but it's not like it's 70% of the market like it was just a couple of years ago. So it's not all the craziness. And there's always, of course, a good home coming up. We've seen market times extend up towards 30 and 35 days versus 18 or 15 days is what we've been used to these last five years. So again, if you're thinking about buying a home, now might be the right time because the other side of that coin is home values themselves are still going up. So they're up 4.3% year over year just because there's a lack of new construction. And without new homes on the market, But, again, there's that bottom-up price inventory because of all the sellers that are staying put because of their low interest rates. Let's talk about investments. Is now a good time to consider the possibility of maybe getting an Airbnb rented out or anything? I mean, I feel like a lot of people might be considering renting, too. Absolutely. And I am. Like I myself, I've picked up three rentals so far this year. I'm looking at closing on a fourth pretty quickly here. There are some really good situations that make sense where you can have positive ROI, especially in the Airbnb and the VRBO route, but you have to be careful as to what city it is. So Birmingham just put a moratorium on additional Airbnbs, so that is definitely not a city to go into. Bloomfield doesn't allow them at all, and Ann Arbor doesn't allow them at all. So you really got to be careful and get a good real estate agent or check with that municipality. Call the assessor's office. See if there's a cap on the number of rentals or Airbnbs there is, and make sure that cap hasn't been fulfilled yet. Before you buy something, just find out you can't do anything with it. I have to talk about data centers and the controversy about buying a home near one or living in one where a data center might be going in. We recently saw a report that it doesn't really change the value of a home, right? It doesn't. So this is a really big concern by homeowners right now, whether you're in Lyon Township or Saline or you're in Van Buren, because especially the big Google one just got re-approved that just passed muster through the commissioner's office. So this is a really big deal with local residents. A lot of them are very, very against it. Now, I think what we're going to find is, especially in Wayne County, they are monitoring the noise pollution as best as they can, unlike some of the older model ones. So I think going into the future, all that tax revenue coming into the city is going to cause schools to improve, cause their niche rating to improve, causing home values in those communities to to improve. I know that's not the popular answer. Trust me, I know I would not want to live next to a data center myself. And I don't think I'd mind living in a city that has one, again, as long as I'm not right on top of it. Yeah, we've got to be careful what you say here, because I know you got some interesting comments on your social media. We talked about data centers the last time you were here. But of course, with everything, there are pros and cons. Always. Yeah, there always are. You got to monitor all of it. I do want to talk about Detroit's real estate, Detroit itself downtown even uh oh my gosh i mean what's going on with detroit because i feel like a lot of people are worried that they can't afford their taxes because properties are going up yeah and we are hoping that mayor sheffield does something to correct the taxes i know she's already went to lansing the first week of her term which is great so it's really interesting we've had three different mayors with three very different agendas and i really like the way that this actually played out over the last 15 years like mayor bing wanted to stabilize the city of the finances and get it out of bankruptcy. And then we had Mayor Duggan that came in and said, okay, we need to rebuild the businesses and the infrastructure and the money flowing into the city. We need people to want to come downtown and come to the city. People that have money to spend like, frankly, my parents, the boomer generation, which is happening. It's busy downtown. But now Mayor Sheffield's priority is the neighborhoods, which I really appreciate. She is all about filling in the spotlight gaps that were left when they went and redid all the lighting. She really wants to improve the schools. And one of her top priorities is lowering the taxes because Detroit has the highest millage rate of any major city in the U.S. If you look at all of the cities in the U.S., our taxes are 40% higher in the city of Detroit, and that's really been holding down values. Now, if she can figure that out, we're going to see values go up pretty rapidly in the city. I mean, even talking high rises, to see Detroit and people moving downtown and wanting to be in the buildings on the lakefront or the riverfront. Oh, it's happening. It's happening, and it's happening so quickly we can't even keep up. Just in the last year, we saw a $2 million sale over in Boston Edison. That was a record breaker, which is really cool. There's a new one that's coming on market this weekend. That's a $2.7 million condo in the Book Cadillac building. It's the penthouse. It's actually really cool looking. I literally just got the alert while I was sitting out there. I can't wait to see that one. I really want to go see that one. It looks great. It's 3,000 square feet, two bedrooms, double story, a great room. It's a one of one as far as condos go. Well, and I know recently I sent you something about Highland Park. I mean, there's a house for like $649,000 in Highland Park. In Highland Park. If you look at Highland Park and Hamtramck both, those prices have really accelerated a lot. Like there was a time when I was investing in Hamtramck and I was buying duplexes for $70,000 or $80,000. But now those are $300,000 or even $400,000. Some of these cities have really come back and come back really fast. I want to bring up one other thing about the Rensselaer and the possible changes we can expect. So stick around, Michael, because this is going to be an interesting conversation. The Rensselaer redevelopment plan has a lot of people talking. Quick break. We have a lot more coming up in this show. Don't go anywhere.