Is Michigan’s Housing Market Heading for a Crash? Here's What the Data Says
As real estate headlines sound alarms in markets across the country, many Michigan homeowners and homebuyers are asking the same question:
Is Michigan next?
States like Florida, California, Texas, Nevada, and even parts of Ohio are showing clear signs of a market correction. Home prices are slipping, inventory is climbing, and bidding wars have cooled significantly.
But in Michigan, particularly Metro Detroit, the story is quite different.
In this post, we’ll break down the three most important indicators that show where the Michigan housing market really stands, and what it means if you're thinking about buying or selling in the months ahead.
1. Inventory Levels in Michigan Are Stable
According to Redfin's July 2025 market report, the state of Michigan has 2.0 months of housing supply, which is unchanged from the year prior.
For context:
A balanced market has between 5–6 months of inventory
A seller’s market typically has less than 4 months
So despite rising rates nationally, Michigan’s inventory remains low and stable, not flooded, as seen in other states.
What it means:
There’s still demand and competition for well-priced homes. Buyers don’t have endless options, and sellers haven’t lost their leverage.
2. Home Sales in Michigan Are Steady
While many U.S. markets are reporting major drops in transaction volume, Michigan has held relatively firm.
According to Redfin, 11,945 homes sold in July 2025, a 3.6% increase year-over-year.
This modest gain shows that buyer activity remains strong, even with today’s interest rates. It also suggests the Michigan market is more resilient than some of the overheated boom-and-bust markets elsewhere in the country.
What it means:
The fear of a total buyer freeze in Michigan hasn’t come to pass. Homes are still moving, especially those in move-in ready condition and priced strategically.
3. Home Prices in Michigan Are Still Rising
Perhaps the strongest signal of market health: Michigan’s median home price continues to climb.
Median Sale Price (July 2025): $291,500
Year-over-Year Increase: +5.3%
According to Zillow, the average Michigan home is selling in 10 days, and values have increased 2.6% year-over-year statewide.
Source: Zillow Michigan Home Values
In contrast, many cities in other states (Austin, Phoenix, San Francisco) are seeing price drops of 5–10% or more.
What it means:
Despite interest rate pressures, Michigan continues to appreciate—thanks to limited inventory, job stability, and relatively affordable home prices compared to national averages.
What This Means for Buyers and Sellers in Michigan
Buyers: Don’t Wait for a Crash
If you're holding out for a massive price drop in Michigan, the data suggests it’s not happening (at least not in 2025).
Home values are still rising. Inventory is limited. And well-located homes are selling quickly. Delaying a purchase could mean paying more next year.
Sellers: You Still Have Leverage, But Be Smart
Low inventory is still working in your favor. But buyers today are more price-sensitive and more selective. Homes that are overpriced, under-prepared, or poorly marketed will sit longer.
If you're considering selling:
Price strategically based on recent comps
Stage and present the home well
Work with an agent who understands today’s buyer mindset
Final Takeaway: No Crash, Just a Balanced Shift
While some U.S. housing markets are experiencing sharp corrections, Michigan’s market remains fundamentally strong.
To recap:
Inventory is stable
Sales volume is holding
Home prices are still rising
That means opportunity for both buyers and sellers, but with less room for error than during the boom years.
Interested in Buying or Selling in Metro Detroit?
The Gilson Home Group specializes in helping buyers and sellers succeed in Metro Detroit and Southeast Michigan real estate. If you want hyper-local data, expert negotiation, or just smart guidance, reach out today.
Not sure where to start? Click here to find out what your home is worth.
Contact us:
Call or Text: 248-385-8005
