In the Detroit, MI market, new home closings dropped year-over-year in November, and the percentage decline was steeper than October 2015, giving suggestion the market may be worsening. New home closings saw a drop of 56.9% from the year earlier to 85. This followed a 54.7% drop year-over-year in October.
A total of 1,935 new homes were sold during the 12 months that ended in November, down from 2,047 for the year that ended in October.
Of the total number of closings, new home closings made up 0.8%. New home closings were 1.5% of overall closings last year. Following a year-over-year rise in October, closings of new and existing homes declined year-over-year in November.
Pricing and Mortgage Trends
In November, there was a 14.4% surge year-over-year in the average price of newly sold homes, reaching $342,355 per unit. This gain is smaller than the 16.4% bump in October year-over-year.
For newly sold homes, the average mortgage size saw a rise year-over-year along with new home prices. In November 2015, there was a 10.0% boost in the average mortgage size, reaching $288,755. Average mortgage size jumped 7.2% in October 2015 from a year earlier.
Other Market Trends
As a share of new home closings, single-family home closings have climbed from last year while the share belonging to attached units has fallen. The share of new home closings belonging to single-family homes grew from 28.4% in November 2014 to 47.1% of closings in November 2015. Conversely, the share of new home closings belonging to attached units dropped to 52.9% of closings from 71.6% of closings.
For all new homes sold, the average unit size jumped 1.2% year-over-year to 2,519 square feet in November 2015. An increase in both the average size and price of newly sold homes was also seen in October 2015 when the average size increased 1.8% to 2,695 square feet. The average size of newly sold homes moved from 2,648 square feet in October 2014 to 2,695 square feet in October 2015.
Foreclosures and real estate owned (REO) closings fell in November from a year earlier, but remained a burden on the market. Combined, foreclosures plus REO closings represented 71.4% of existing home closings, below 72.0% a year earlier. The percentage of existing home closings involving foreclosures fell to 4.7% in November from 10.2% a year earlier while REO closings as a percentage of existing home closings climbed to 66.6% from 61.8%.