economy (3)

Long written off by many, Detroit is becoming an interesting city to watch from an urban revitalization perspective. At the core of these developments is the emergence of a startup ecosystem where (for the most part) one did not previously exist. While still early, the progress made in this area over the last several years has been impressive and is having an impact on the region. As an outsider looking in with experience in other entrepreneurial hubs, I wanted to share thoughts on conditions and trends coming together that may help elevate this into a more viable and sustainable model for the city going forward.

I grew up in the Detroit area in the 1970s and 80s. While officially in the suburbs, our house was only two blocks from the city border, bringing the city a bit more upfront in our personal lives. During high school and college, I also worked at the old Tiger Stadium, which afforded the opportunity to experience the city even further.

It was a tough time for Detroit, coming off the riots from the late 1960s and the accompanying exodus of hundreds of thousands of residents. Those challenges continued well after I had left, with the downsizing of the automotive industry, a shrinking tax base, and too much mismanagement and corruption at a local government level.

After graduating from college, I left the area for a programming job in another state. While I continue to spend time in Ann Arbor, I’ve spent little in downtown Detroit over the last 25 years. Still, with family and friends in southeastern Michigan, I have watched it from afar with interest over the years. More recently I’ve been intrigued to 

watch the rise of the startup community in the region. To be honest, I did not give it a lot of real hope considering the multitude of challenges facing the city.

Sometimes when you’re down, the only way is up. But the story goes much beyond that here. Despite the potential for municipal bankruptcy currently hanging over the city, there are good things happening in Motown. The recent TechCrunch profile of Dan Gilbert does a great job outlining some of them. The region is taking steps and riding some key trends that are starting to effect change. From an outsider’s perspective with some familiarity with the region, here are some of the key ones that are driving (at least for me) a more optimistic view of the city’s trajectory:

 

Read More: http://www.xconomy.com/detroit/2012/12/18/hope-in-detroit-an-outsider-on-motowns-entrepreneurial-renaissance/

Read more…

Appears that mortgage defaults are still a concern.

See article link below from Market Watch via the New York Times.


http://www.marketwatch.com/story/1401-of-mortgages-delinquent-or-in-foreclosure-2010-05-19?siteid=bnbh


Love to hear your thoughts about the steady supply of foreclosures. I think it is here to stay for the next 18 months. With the initial wave of foreclosed homes, and the general economic meltdown, this overall rate of defaulted homes and foreclosures are not solely based on no doc loans. There has also been a secondary set of loans that have adjusted and reset creating more problems for many homeowners. The third wave is based in part on the job losses and employment cut backs over the past 12-18 months which has effected middle class buyers. When you have homes in your immediate area or neighborhood that are distressed and or foreclosed, the baseline value effects everyone. Then if you loose a job or get your hours cut, making ends meet is an issue. You can't refinance your way out it. And many governmental programs simply are too cumbersome and difficult to work through. So to me this is not a big surprise. As I have mentioned before, link all this with the commercial foreclosure market and "shadow inventory" of FDIC and bank owned new construction projects off the books and records, we have a long road ahead of us. Because every new media event erodes buyer confidence, keeps the lending institutions nervous and restrictive and keeps many people stuck without options.

Love to hear what is happening in your market or state? Thanks Greg
Read more…

$8000 Homebuyer Tax Credit

National Association of Realtors Chief Economist Lawrence Yun said existing home sales will rise through the fourth quarter, but that the end of a federal tax credit that gives first-time homebuyers $8,000 will affect that pace if it expires in November. As per [FAR and Palm Beach Post]. I agree what is your opinion on the first-time homebuyers tax credit? I think they should leave it into play for another 6 - 12 months.
Read more…