Detroit Housing Prices Continue to Rise

  • The State and City of Detroit’s unemployment rate increased at the monthly and annual levels;
  • Regionally, June 2018 unemployment rates are higher than the prior year, with the exception of Monroe and Washtenaw counties;
  • Housing prices continue to rise in Metro-Detroit.

In June of 2018 the unemployment rate for the State of Michigan was 4.3, an increase from the May unemployment rate of 3.8, according to the most recent data provided by the Michigan Department of Technology, Management and Budget. The State unemployment rate for June of 2017 was 0.3 points above what it was in June of 2018.

The Detroit rate was 1.4 points higher in June of 2018 than in May. Also, the June 2018 unemployment rate for Detroit was 1.5 points higher than what it was in June of 2017.

The chart above displays the unemployment rates for each of the seven counties in Southeastern Michigan for June of 2017 and 2018. In June of 2018 Wayne County had the highest unemployment rate at 5.4, with St. Clair County having the second highest regional unemployment rate 4.6. These two counties were the only two in the region to have unemployment rates above 4.5 in June of 2018. Conversely, Oakland, Washtenaw and Livingston counties all had unemployment rates at or below 3.5 in June of 2018.

Oakland County and Livingston County were the only other two counties in the region with an unemployment rate below 3.5. Regionally, Livingston County had the lowest unemployment rate in June of 2018 at 3.3. Livingston County also had the lowest unemployment rate in June of 2017 at 3 while Wayne County had the highest unemployment rate in June of 2017 at 5.

When comparing 2017 and 2018, Monroe and Washtenaw counties are the only two where the unemployment rate was higher in 2017 than in 2018. For Monroe County, in June of 2017 the unemployment rate was 4.9 and for 2018 it was 4.4. For Washtenaw County there was also a 0.4 difference, from 3.9 in 2017 down to 3.5 in 2018.

The above chart shows the Standard and Poor’s Case-Shiller Home Price Index for the Detroit Metropolitan Statistical Area. The index includes the price for homes that have sold but does not include the price of new home construction, condos, or homes that have been remodeled.

According to the index, the average price of single-family dwellings sold in Metro Detroit was $122,600 in May 2018; this was $920 higher than the average family dwelling price in April. The May 2018 price was an increase of $7,740 from May of 2017 and an increase of $16,060 from May of 2016, an increase of $21,030 from May of 2015 and increase of $26,430 from May of 2014.

African American Homeownership Lacking Southeastern Michigan

Further examination of the percentage of African American homeowners in Southeastern Michigan in 2016 confirms that the City of Detroit had among the highest percentages in the region. However, it was the City of Highland Park that had the highest percentage of African American homeowners in 2016 at about 96 percent. In total there were 13 municipalities in the Southeastern Michigan with African American homeownership above 50 percent. The percentage of African American homeowners in Detroit in 2016 was 53 percent. As the map below shows, the concentration of African American homeowners in Southeastern Michigan is located in the Detroit inner-ring suburbs. The City of Pontiac, which has about a 52 percent homeownership rate, was the only City outside the inner-ring with African American homeownership above 50 percent. Additionally, aside from a few pockets in Wayne, Oakland and Macomb counties, African American homeownership did not rise above about 13 percent in majority of the region. In total, there were 41 municipalities in Southeastern Michigan where African American homeownership was at 0 percent in 2016. Many of the municipalities with 0 percent African American homeownership have small African American populations, according to Census data. 

As noted in the previous post, the lack of African American homeownership in Southeastern Michigan can be attributed to the Great Recession, which brought on higher rates of unemployment and foreclosures. However, it can also be argued that the low percentage of African American homeownership in the outskirts of Southeastern Michigan can be attributed to the large scale migration of Caucasian individuals from Detroit to its suburbs in the 1950s and 1960s; this trend is also commonly referred to as white flight.