Saginaw, Michigan - The Least Expensive Real Estate in the U.S.

According to Demographia’s 7^th Annual Demographia International Housing Affordability Survey: 2011, the city of Saginaw, Michigan has the most reasonably priced real estate amongst 6 nations including the United States, Canada, the United Kingdom, Ireland, New Zealand and Australia.  Demographia defines affordability using a term they refer to as the “median multiple” where the median price of a house in a given market divided by the median household income in that same market.  In this case, the term “median” refers to the midpoint between the lowest price or income and the highest price or income.  Deomgraphia defines affordable real estate where there is a multiple of 3.0 or less (i.e. if the median income of a family in given market is $50,000, the median price of homes must be less than $150,000).  The median multiple for the city of Saginaw is 1.6, just below Flint, Michigan and Youngstown, Ohio both of which had median multiples of 1.7.  For my Canadian readers, by comparison, the lowest median multiple was for Windsor, Ontario which came in at 2.1 followed by Fredericton, New Brunswick which came in at 2.3.   For my readers in the United Kingdom, the lowest median multiple for a major urban centre with more than 1 million residents was for Leeds and West Yorkshire which came in at 4.6 and for my readers in Australia, your lowest multiple was found in Perth which came in at 6.3.  In the top 100 affordable markets (a multiple of 3.0 or less) in the study, there were no urban centres from either the United Kingdom or Australia. 

Back to Saginaw.  The city of Saginaw, Michigan is located in the central part of the state of Michigan, near the shores of Lake Huron.  Here's a map showing the location of Saginaw:

In the 19^th century, the Saginaw area was the site of a booming lumber industry; since much of Michigan was forested with white pine and the nearby Saginaw River provided water transportation for logs felled upstream, at its peak, 23 sawmills operated in the area surrounding the present-day City of Saginaw which reached a population of 75,813 in 1884.  As Michigan became the automotive capital of the United States in the early 20^th century, Saginaw became the home to various divisions of General Motors.  During the Second World War, Saginaw was home to an M1 Carbine rifle production facility  As General Motors expanded during the post-war period, Saginaw grew to reach a maximum population of 98,265 in 1960.  In the 2006 Census, the population of Saginaw had dropped to 57,523 people, a 6.9 percent drop in residents from the April 1^st, 2000 population of 61,799.  In 2009, the population had dropped further to reach 55,238.  In 2000 (the latest year that records are available for the City from the United States Census Bureau), the city had 25,639 housing units with a median value of $46,800.  Median household income was $26,485 in 1999 compared to $44,667 for the State of Michigan with 28.5 percent of residents living below the poverty line compared to 10.5 percent for the entire state.

In large part, Saginaw’s shrinking population is a result of de-industrialization.  The manufacturing industry employed a peak of 36,600 workers in Saginaw County in 1978; by December 2009, that had fallen to 10,400, the lowest number of manufacturing workers since 1920 when there were 12,319 workers.    It is hoped that expansions at the local Hemlock Semiconductor Corporation plant could help boost local manufacturing employment.  To summarize the employment picture, according to the Bureau of Labor Statistics, the Saginaw County area had an unemployment rate of 10.2 percent in December 2010, coming in below the national average of 9.1 percent and at 271st place out of 372 metropolitan areas.

Saginaw City’s 2010 budget reflected a “zero growth” strategy because of dropping revenue.  The decline in property values resulted in an increase in the millage rate; from the previous fiscal year, the total taxable value of residential properties decreased from $471.6 million to $445.1 million.

Onward to some examples of Saginaw real estate.

Let's start with the first house that comes up:

This rather small 728 square foot bungalow is located at  2726 Lowell and is listed at $2600.00.  It has two bedrooms and one bathroom and from the photos of the inside, it has pretty much been gutted.  Unfortunately there is no history of either taxes or selling price.  On the upside, it is less than a mile from a very well rated elementary school!

Here's a new listing at 3009 Fairview Street: 

This 2 bedroom, one bathroom 896 square foot bungalow is listed at $9500.  From the interior photos, it looks to be intact but definitely needs some work.  For the past 3 tax years, it has been assessed at just over $12,800 with property taxes ranging from $586 in 2008 to $641 in 2010.  Once again, it is located less than a mile from a very well rated public elementary school.

Here's a rather nice looking 894 square foot 2 bedroom, single bath bungalow located at 1827 Burnham Street with an asking price of $15,000:

From the inside photographs, it appears to be in "move in" condition, especially when compared to other listings.  According to the property history, it has been assessed at between $17,150 and $18,846 over the past 3 years with taxes of $868 in 2008 and $762 in 2010.

Let's move to the middle of the pack and see what you can buy for just over $50,000.  Here is a rather amazing looking all brick, two story, 3155 square foot, 4 bedroom, three bathroom home located at 430 S Weadock:

This home appears to be occupied and from the large selection of interior shots looks to be  in move-in condition.  Unfortunately, no tax or sales history is available.  As a lover of older homes, this is one that I would definitely consider purchasing for its character alone.

Just for fun, let's go to the top of the heap to see how the other half lives (well, okay, maybe not half).  This 4008 square foot, 4 bedroom, 3.5 bathroom home is located on 14 acres at 2150 South Thomas in suburban Saginaw:

The asking price for this rather palatial one and a half story log home is $989,500.  From the interior shots, it looks like a rather amazing home.  Once again, no tax or sales history is available but I guess if you have to ask how much the taxes are, you really can't afford a million dollar home.  And, as a bonus, just in case you have four cars, they can each have their own garage!

It is interesting to once again see how polarized American society is becoming and how real estate values are increasingly reflecting the great divide between the rich and the poor in our society.  I hope that you enjoyed learning a bit more about Saginaw, Michigan, home of the most reasonably priced real estate in the United States when measured in terms of price to household income.