$1 million-plus home sales in metro Detroit have more than doubled

A million dollars doesn't buy what it used to in metro Detroit.

The number of home sales at or above the $1 million mark has more than doubled compared with before the pandemic, according to local housing market data, and prices continue to rise even as jumbo mortgage rates hover around 7%.

Long gone are those immediate post-Great Recession days when a $1 million might still buy a mini mansion in some highly desirable suburb.

Although $1 million isn't yet the entry price for a Birmingham or a Bloomfield Hills, the market continues to head in that direction.

From Jan. 1 through Tuesday, there were 506 sales of houses or condos priced $1 million or higher in metro Detroit, according to an analysis conducted for the Free Press by the Realcomp multiple-listing service, which defines the metro region as Wayne, Oakland, Macomb and Livingston counties.

For the same January through July 30 period in 2019, there were 224 such sales reported. And for all of 2019, the number of $1 million-plus sales was 399 — significantly fewer than just the first seven months of 2024.

John Apap, president of The Apap Realty Group in Birmingham, said the jump in sales prices has been considerable, and noted how he is about to list a two-story, five-bedroom house in downtown Birmingham for $3.7 million that last sold in 2020 for $2.2 million.

“Just in two or three years, the prices have almost doubled on some of these properties," he said. “The norm has definitely changed — there’s no question. And I’m a little bit surprised at how fast it’s gone up.”

Many $1 million-plus listings are newer construction, such as a two-story, four-bedroom gray brick house in Royal Oak that was built to replace a small bungalow on the lot that was torn down. The house listed for $1,050,000 in late spring and now has a pending offer, Apap said.

That phenomenon of tearing down to build big once happened a lot in Birmingham, and has been spreading to other cities like Royal Oak, he said.

More: Cost to buy a home in metro Detroit just went up despite 7% mortgage rates

Even so, there are smaller and older houses in Birmingham that still hit the market for well under $1 million.

“You can still buy a home in Birmingham for $400, $500,000," said Nathan Boji, vice president and associate broker at RE/MAX Classic. "It may not be a mansion. But it will be a home and you’ll be comfortable. So you can still get in.”

Yet prices are still shooting up — particularly for new and relatively recent construction.

One $1.1 million RE/MAX Classic listing in Novi last month was for a two-story, four-bedroom brick house on Amesburg Drive. The house — now with a pending sale — last sold for $543,538 in 2009, the year it was built, according to Realtor.com.

Apap said that for the $1 million-plus sales he does, the majority that are $2 million or over tend to be cash sales with those closer to $1 million are more likely to involve mortgage financing.

Jumbo loans can be used for properties above the lending limits for conventional mortgage loans, currently $766,550 in Michigan. They generally have tighter requirements for borrowers and slightly higher interest rates.

“The majority of our clients are paying in cash," Apap said. “I’ve noticed it’s a lot of family money, too, because a lot of these are younger buyers.”

To be sure, the metro Detroit housing market as a whole is still far cheaper than many others in the country.

The median sales price here for a house or condo was $285,000 in June, or 5.6% higher than a year earlier, according to Realcomp data.

And the widely cited S&P CoreLogic Case-Shiller home price index found metro Detroit prices this spring to be the lowest in all 20 metropolitan areas within the index, or 2% below Cleveland's, 49% below Charlotte's and 64% below New York's.

Contact JC Reindl: 313-378-5460 or jcreindl@freepress.com . Follow him on X @ jcreindl

This article originally appeared on Detroit Free Press: $1 million-plus home sales in metro Detroit have more than doubled