A New York-based personal finance technology company wanted to know where the healthiest housing markets in Michigan were.
SmartAsset, which was founded in 2011 and uses software and data to find answers to complex financial questions about home-buying, retirement, life insurance, student loans and other topics, recently released its first-ever ranking of The SmartAsset Healthiest Housing Market Study, which ranked a number of cities in Michigan.
“The SmartAsset Healthiest Housing Market Study looks at the cities across the nation that have a healthy housing market, defined as both stable and affordable: Homeowners in a healthy market should be able to easily sell their homes, with a low risk of losing money over the long run,” said Asees Singh, PR lead at SmartAsset.
“This is the first year we've conducted the study, and we plan to do it annually.”
West Michigan did well on the list, with Hudsonville taking the No. 1-ranked spot, and Zeeland finishing second. Also finishing among the top 10 were Rockford at fourth, Byron Center at sixth and Grandville at seventh.
“Some great news for Michigan is the state's top 10 healthiest housing markets all ranked well nationally. In our study, we not only looked at each state; we calculated the top 10 healthiest markets across the nation, as well. The top 10 cities of Michigan all ranked in the top 250 cities nationally, out of 4,000-plus cities,” she said.
“Along with the study, we released an interactive map that allows folks to check out all the counties in the state and the country to compare markets. The map details stats including national rank and the numbers associated with the factors we looked at.”
To find the healthiest housing markets in the country, Singh said SmartAsset considered the following four factors: stability, affordability, fluidity and risk of loss.
Stability was measured with two equally weighted indicators: the number of years people remain in their homes and the percentage of homeowners with negative equity because homeowners with negative equity are more likely to go into foreclosure, she said.
“To account for our second factor — risk — we used the percentage of homes sold at a loss.
“To determine housing market fluidity, we looked at data on the average time a for-sale home in each area spends on the market — the longer it takes to sell, the less fluid the market,” Singh said.
“Finally, we calculated affordability as the monthly cost of owning a home as a percentage of household income in each county and city. Affordability accounted for 40 percent of the housing health index, while each of the other three factors accounted for 20 percent.
“When data on the above four factors was unavailable for cities, we excluded these from our final rankings of healthiest markets.”