Oakland County, Mich., home sales rise despite job losses

— -- Oakland County in Michigan is a county of contrasts: It is near Detroit, and its county seat is Pontiac, a depressed, blue-collar city. But it's also home to affluent areas such as Birmingham and Farmington Hills, and because of them, it ranks among the nation's wealthiest counties.

Pontiac is still losing jobs because GM assembly plants are closing, yet it is one part of the county where home sales are picking up.

"There are some great deals in Pontiac," says Amy Albright, president of the North Oakland County Board of Realtors. "The prices up to $150,000 are booming."

First-time home buyers are snapping up lower-price homes and taking advantage of a one-time federal $8,000 tax credit.

"It makes homeownership cheaper than renting a home in some areas," says Don Grimes, senior research specialist at the University of Michigan.

In July, home sales in the county rose 20.1% from a year ago, but home prices continued to drop sharply. Median prices were down 25.9% compared with July 2008.

Low-price homes are now getting multiple offers and selling for more than the asking price, Albright says. But high-price homes are on the market much longer.

"It's a lot more difficult, because there is a smaller pool of buyers in the higher-priced range now," Albright says. In the past, many of the buyers were auto executives. Now, many of them are losing their jobs and leaving the area.

Although the county has been feeling the brunt of the auto industry's collapse, it is in better shape than many other parts of the state. "Its unemployment rate is worse than the nation, but it's not as bad as Michigan overall," Grimes says.

That is because its local economy is more diverse than other parts of the state. It has less dependence on auto-parts producers, Grimes says. And its employers include the health care, information technology and finance industries, which attract white-collar jobs.

Even if jobs improve, it's unclear if the housing market will see prices turn around any time soon. The bank-owned properties and short sales are good news for buyers but not for sellers. All home values are dragged down.