Ann Arbor Housing Market Can Weather Storm, Realtors Believe

In a residential real estate climate that’s already sluggish at best, news that Pfizer would close its Ann Arbor facilities and eliminate 2,100 jobs prompted many to wonder Monday whether this segment of the stagnant Michigan housing market would get even worse.

But according to the Detroit Free Press, local real estate experts believe that the Ann Arbor market can withstand a slump and endure a certain level of shock.

“Certainly we’re sad to hear about Pfizer closing its Ann Arbor campus,” said Nancy Merdzinski, executive officer of the Ann Arbor Area Board of Realtors.

“It’s difficult to say how it will affect our real estate market. The good news is we have a well-trained and diverse workforce… We certainly hope that employees will be able to stay in the area and find employment with existing companies or new companies that are locating here.”

Even with Michigan mortgage rates low, real estate in Michigan has been sluggish for the better part of a year. In particular, the Ann Arbor housing market stayed flat in 2006, like most of metro Detroit’s. The median sales price dropped to $219,900, compared with $226,000 in 2005.

The number of days on market also jumped. Homes and condominiums languished on the market for nearly three months on average, and the number of homes sold dropped 11 percent, according to data released by the Board of Realtors.

At the end of 2006, 12,548 houses and condos were on the market in the Ann Arbor region. However, commercial real estate appears to be going strong, with office vacancy rates were among the best in the state at 9.8 percent.

It was too early to say how Pfizer’s closing would affect that rate. The good news for the Michigan market is that home mortgage loan costs remain at relatively affordable levels. With the economy in turmoil, prices are likely to stay flat, giving first-time buyers an opportunity they’d be hard pressed to find in many other states.