The “buyers’ strike” has caused house prices to drop, along with an epidemic of foreclosures. What’s worse, the long depression in real estate is probably not over. S&P has forecast that home prices will drop by 7% to 10% this year. The S&P Case-Shiller Index has dropped for most of the 20 largest real estate markets over the last several months. RealtyTrac recently reported that more than 1 million homes were foreclosed upon in 2010.
Market lean: Buy
Cities like Flint, Mich., have economies based on a single major industry. In Flint’s case, that industry is auto manufacturing. When that industry began to decline, Flint was unable to diversify to prevent a population exodus.
……..Since the American auto industry began its decline in the 1980s, Flint has consistently lost at least 10% of its population each decade. Massive layoffs and plant closings have devastated the city, and unemployment rates remain well into the double digits. more
Ask me how this affects investment in the area.