The Bay City metro area population is dropping, not a positive trend for home sellers. The number of residents fell 2.2% from 2000 to 2010 and another 0.8% over the following two years.

"If you're losing population, you're going to have available housing," said Bay City mayor Christopher Shannon.

Located where the thumb of Michigan's mitten meets the hand, about 120 miles north of Detroit, Madonna's birthplace long had an economy with a solid manufacturing base, which included boat builders.

"That legacy is not always positive," said Shannon. "Reliance on it has come back to haunt us."

When much of the heavy industry work left, the economy had to adjust. Now, chemical and silicon chip processors, auto parts makers and sugar beet refiners are the largest private employers.

The housing stock is well maintained and includes many impressive Victorian homes built when the lumber industry produced much local wealth, according to Shannon.