Success of GM Volt Could Stem Further Michigan Foreclosures

by Donald Hanz on States

The success of Chevy Volt could usher in jobs that would help stem further Michigan foreclosures. Over the past ten years, Michigan has lost about 78 percent of jobs in the auto manufacturing industry and over the past couple of years, the state has been posting among the highest foreclosure rates in the country.

Last year, more than 118,000 Michigan homes entered foreclosure and in the first four months of this year, another 24,856 units were bought back by banks through foreclosure home auctions and put into their lists of bank owned homes.

Based on records from state agencies, around 860,000 people in Michigan have lost their jobs over the past 10 years, with majority losing their jobs after 2007. Before and after General Motors, Chrysler and over 50 auto parts suppliers declared bankruptcy, thousands of families lost their only source of income and made the state unemployment rate the highest in the country.

The pace of Michigan foreclosures is still rising, bucking the nationwide trend of a slowdown. In April, there were nearly 13,000 pre foreclosures and more than 6,200 homes already counted as foreclosures for sale. While other foreclosure-hit states like California, Arizona and Florida posted substantial decrease rates, Michigan posted more than 8 percent of increase in filings over the month.

In the first quarter, a total of 18,604 homes were repossessed by lenders through foreclosure home auctions, putting Michigan fourth in the nation in number of REO units during the quarter.

The Volt is an electric car that uses a rechargeable lithium ion battery. With one charge, it can power the car to run about 40 miles. The gas-powered engine will generate electricity to move the car up to 300 miles. If successful, Volt will create thousands of jobs in the engine and battery industries.

In April, home sales and prices increased throughout the state, raising hopes that Michigan foreclosures finally have started lessening their downward pressure on price levels. The average price for pre-owned homes rose by almost 15 percent to $101,282 over the year.

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