Is Michigan’s Real Estate Market Finally Cooling Off — or Just Catching Its Breath?

If you’ve been wondering whether now’s the time to buy, sell, or just stay put in Michigan’s ever-shifting real estate market — you’re not alone. We’ve been hearing it from all sides lately: “Why are prices still rising even with higher interest rates?” or “Is my city still a seller’s market?” or the big one — “Did I miss the window?”
Let’s clear the air: Michigan’s housing market is still moving, just not the way it did during the frenzy of 2021 and 2022. It’s less of a sprint, more of a steady jog. But depending on where you are — say, downtown Detroit versus a quiet corner of Midland — the story can be wildly different.
🔥 Here’s What’s Really Going On in 2025:
1. Prices are still climbing — but more slowly.
Across Michigan, home prices have continued to tick upward, but we’re not seeing the double-digit jumps of the pandemic years. Statewide, median home prices are up about 4.6% year-over-year, according to the most recent MLS data. That’s still growth — but more manageable.
In Grand Rapids, for example, buyers used to line up with offers $30K over asking. Now? Homes are still selling fast, but buyers are negotiating again. “It’s still competitive,” one local buyer told me, “but I didn’t have to waive my inspection this time. That’s a win!”
2. Inventory is… complicated.
Michigan’s inventory levels are creeping back up — but slowly. Many would-be sellers are holding off, clinging to those sweet 3% mortgage rates they locked in years ago. Meanwhile, new listings are popping up in pockets — especially in suburbs around Ann Arbor and Lansing, where relocation and downsizing are creating fresh opportunities.
3. Interest rates are still high, but buyers are adjusting.
With mortgage rates hovering around 6.75% to 7%, affordability is a real hurdle. But here’s the twist — buyers haven’t disappeared. They’re just shifting strategies: opting for smaller homes, different cities, or even waiting for price drops that may or may not come.
🏙️ What’s Happening in Your City?
Detroit:
Downtown development is still buzzing, but more locals are eyeing historic neighborhoods like Bagley or East English Village — where character meets value. Investors are also back, scooping up multi-family units as rental demand climbs.
Grand Rapids:
Still one of Michigan’s hottest markets, but cooling ever so slightly. Homes under $300K are moving fast. There’s chatter about first-time buyers getting “priced out,” but savvy ones are exploring nearby towns like Wyoming or Kentwood.
Ann Arbor:
High demand, low supply — sound familiar? With the university anchoring jobs and culture, Ann Arbor remains a seller’s playground. But with median prices near $450K, many are now eyeing Ypsilanti for a little more breathing room.
Smaller towns? Don’t sleep on them.
Places like Flushing, Mason, and Alpena are seeing a rise in interest from remote workers and downsizers. One couple I met just bought a lakefront fixer-upper in Cadillac — their logic? “We can work from anywhere, so why not live where we love to vacation?”
So… Should You Buy? Sell? Wait?
It depends (we know — classic real estate answer). But here’s what we’re seeing on the ground:
• Sellers: If your home is in good condition and priced right, it will sell. There’s still buyer demand — especially for move-in ready homes in family-friendly neighborhoods.
• Buyers: You’ve got more breathing room than you did two years ago. Less bidding war chaos, more room to negotiate. Just make sure you’re pre-approved and realistic about monthly payments.
• Fence-sitters: Start watching your local market closely. The right opportunity might show up when you least expect it.
💬 Let’s talk — would you sell your home if you knew its true value today? Or tell me this: What do you think is the most underrated city in Michigan to buy a home in 2025?
Drop your thoughts below, or tag a friend who’s been “thinking about moving” for the past two years. You know who they are. 👀
P.S. Want a free market report for your zip code? Just ask. It’s what I do.