Pricing Your Home for Sale

The reason that inventory has dropped so much is not because of demand.  It's because many sellers gave up.  This is not a good reason.

This has created a lot of pent up supply of homes that is not currently on the market.   Any hint at price improvements will be met by an onslaught of new listing inventory, which will squash any price recovery.  This includes bank owned properties too.  Therefore, sellers need to be serious and compelling with price.

Homes in the Charleston real estate market that actually sell average about 95% of their final LIST price.  What this really means is that buyers don't put offers on homes until they are within 5% of what they're willing to pay for them.

For buyers, a 1% change in interest rate will produce a 10% change in your purchasing power.  It's good to note,  although the Federal Reserve Chair Bernake has pledged to keep the key note rate down, this does not necessarily correlate with where mortgage interest rates are headed. While prices are down, and interest rates are down, it's a great time to buy.

Until next time,

Lisa Thompson, Realtor
843-270-2221
Lisa@LisaThompsonrRealtor.net
http://www.realestatefromlisa.com/

Buyers Better Hurry Up and Buy!!!

It's a great window of opportunity to sell your home right now.  Buying activity is incredible.  Almost every week of 2012 has seen over 200 properties go under contract.
  

That is awesome because that only happened 4 times in 2008, zero times in 2009, 9 times in 2010, and 19 times in 2011.  And most of those were in the spring and summer.

For sellers, almost 30% of what's going under contract right now is either a short sale or a foreclosure.

Another 27% of what's going under contract is new construction.  That means that almost 67% of what's going under contract are non-traditional sales.

We've all lost about 30% in value since the peak of the market in 2006.

Inventory is down to only around 6,000 active listings, which is certainly better than the 10,000 that we've had for sale.This is still too many homes for sale.

We've only been able to sell between 8,000 and 9,000 homes over the last 4 years.

Since a healthy, balanced market is only 6 months of inventory, we should only have 4,500 homes on the market.

Prices are currently back to 2002 - 2003 levels and are stable.

Lisa Thompson, Realtor
843-270-2221
Lisa@LisaThompsonRealtor.net
http://www.realestatefromlisa.com/ 

 

Charleston real estate market, where we have come from and where we are going

Good morning,

 These two charts show us where we've been over the past several years and where there seems to be encouraging optimism for the future, given a strong start in 2012.

 One of the two charts shows the decline in home values based on price per square foot from the same 6 month period in 2006 compared to 2011 for all the sub geographic areas of the Tricounty as set up in our Multiple Listing System. On average, the decline for our area is approximately 30% from the height of the real estate boom when compared to the same April through September period of 2011.

 The second chart highlights the strong showing we have had in sustained home sales (homes going under contract) of over 200 units per week of single family detached homes in the Tricounty region. We have seen a steady fall off of inventory over the past year which has not yet resulted in overall appreciation of value for our region, but has resulted in a stablization of values for most of the area. Note: all figures in the charts are derived from the Charleston Association of Realtors Multiple Listing System.

 Hope you find these numbers as interesting as I do and that they instill hope for a start to recovery for our local real estate market.

Sincerely,

Jim Hall

AgentOwned Realty

1800 Old Trolley Rd.

Summerville, SC 29485

843-452-5521

Lowcountry Update for Spring

May 23, 2012  

Lowcountry Real Estate Update for Spring!

According to Local real estate stats for the Lowcountry, indications are that conditions are ripe for price increases from 2%-30% in the following areas:

W Ashley,  James Island,  N Charleston,  Mt Pleasant,  Hanahan/Goose Creek/Moncks Corner!

(James Island and N Charleston indicate the highest probable increases.)

Peninsular Charleston,  Daniel Island, and Summerville/Ladson still show probable declines in prices for the immediate future.

This information is derived from comparing recent months of sales to what is currently under contract.  After years of declining prices, price increases are occurring, or are  about to occur, in the areas referenced above.

There are currently 6600 active listings available.  Inventory continues to decline. Buyers are attracted to prices of Summerville and Goose Creek areas  and they prefer new construction over re-sale houses.  Statistics are showing that buyers typically will not negotiate an offer on a house unless it is priced within 5% of what their market data shows it’s worth.  Buyers and their agents are doing their homework well!

Of note: Charleston real estate from 2000-2010 averaged a gain of 34% in value even after adjusting for the average 30% loss of value since 2006.  For that same period the Dow Jones Industrial Average boasts a 6.4% appreciation.  

Lowcountry real estate is still a great investment!

Summerville and Lowcountry Real Estate Market Update

It's a great window of opportunity to sell your home right now.  Buying activity is incredible.  Almost every week of 2012 has seen over 200 properties go under contract.  This past week it was 251.

That is awesome because that only happened 4 times in 2008, zero times in 2009, 9 times in 2010, and 19 times in 2011.  And most of those were in the spring and summer.

For sellers, almost 40% of what's going under contract right now is either a short sale or a foreclosure.

Another 27% of what's going under contract is new construction.  That means that almost 67% of what's going under contract are non-traditional sales.

We've all lost about 30% in value since the peak of the market in 2006.

While inventory is down to only 6,428 active listings, which is certainly better than the 10,000 that we've had for sale, we still have too many homes for sale.

We've only been able to sell between 8,000 and 9,000 homes over the last 4 years.  Since a healthy, balanced market is only 6 months of inventory, we should only have 4,500 homes on the market.

Prices are currently back to 2002 - 2003 levels. 

The reason that inventory has dropped so much is not because of demand.  It's because many sellers gave up.  This is not a good reason.

This has created a lot of pent up supply of homes that is not currently on the market.   Any hint at price improvement will be met by an onslaught of new listing inventory, which will squash any price recovery.  Therefore, sellers need to be serious and compelling with price.

Homes that actually sell average about 95% of their final LIST price.  What this really means is that buyers don't put offers on homes until they are within 5% of what they're willing to pay for them.

For buyers, a 1% change in interest rate will produce a 10% change in your purchasing power.  It's good to note,  although the Federal Reserve Chair Bernake has pledged to keep the key note rate down, this does not necessarily correlate with where mortgage interest rates are headed. 

While prices are down, and interest rates are down, it's a great time to buy.

Home Inspections

Once you have found the perfect home it is time to think about getting a home inspection performed.  There are numerous types of home inspections one could have done to a home.  In South Carolina the two most prevalent are the termite inspection and the general home inspection.

It is highly recommended that you get the home inspected for termites.  Costs in the Summerville area and the Charleston area can run $100 to $150 and it is generally paid for by the seller.  This article will focus on the general home inspection, which is generally paid for by the buyer. The price of a home inspection varies from $250 to $400 depending on the size of the home and the home inspection professional you choose and it is worth every penny.  Why:

Your home is probably the biggest investment you will ever make and you want to know as much about it as you can.  Many of the components and mechanicals in the home are not readily visible.  And you want to know as much as you can up front before you finalize the purchase.  Not knowing everything you can about it would be like investing $200,000 in a stock you know nothing about. It just doesn't make sense financially. It's important to know the details behind the investment and if you will need to put any more money into the home once you own it. Even if you love the home and it looks perfect, not knowing its overall condition can cost you even more money down the line.  Knowing there is a problem now may save you thousands later.  You don’t want surprises.  Your Realtor will be happy to recommend a few licensed and insured inspectors for you to choose from. 

Make sure you attend the inspection and follow your inspector through the home and make notes as to what may need to be fixed. A good inspector knows what to look for and should educate you on the condition and how all the home’s mechanical systems operate.  Knowing if there is a problem with something ahead of time gives you the option of asking the sellers to fix or replace it, or how much it will cost for you to do it yourself after you purchase the home. If seller is not willing to fix the issue, you may be able to back out of the deal.  Your realtor will advise you of your options.

Knowing all you can about the home gives you great negotiating leverage. If the home does need repair, you can ask for it in the inspection contingency of the purchase offer. There are several ways to go about this. You can ask that the seller fix the issues, provides money for you to do so after the purchase or drops the price of the home to cover the repair cost after purchase. The seller can also come back with terms such as "I will fix this but not that". Then the ball is back in your court as to how to respond.  Your Realtor will help you with the negotiations.

Although having an inspection of a pre-owned home is most advisable, don’t negate having an inspection conducted on a newly constructed home.   Builders can sometimes miss things during the construction process.  So even though most new construction is warranted for a certain period of time, it still pays to insure everything is operational and up to building code. 

Bill Milo
Realtor®
AgentOwned Realty
843.412-0052
bill.milo@agentownedrealty.com

December 2011 Statistics

December closed sales were up by 18% from November to December in 2011 for the Tricounty area. That's a robust increase considering it is the holiday season when sales typically fall. A comparison of 4th quarter closed sales units in 2010 to 2011 show a very nice increase of 10% for the entire Tricounty. Inventory figures fell by 16% in the 4th quarter of 2011 compared to 2010. Prices have still remained stable over the last several months in all areas but North Charleston in Charleston County.

 The big winner overall for increased sales and reduction of inventory was West Ashley and James Island. Together they posted a whopping 30% increase in closed sales from the 4th quarter of 2010 to the same period in 2011 while seeing an inventory decrease of 23% in the same time frame.  These two areas also posted a very respectable "months inventory" index in December 2011 of 6.47. The overall tricounty was running well above 10 months of inventory for most of the first half of 2011and latter few months of 2010.  

 For those of you in the northern tricounty, this is a notable piece of information: Dorchester and Berkeley County (excluding Daniel Island area), saw new construction take a 32% market share of closed sales. Bank owned and short sales took another 24% of residential sales and this is a close approximation due to the various ways these type sales can be noted in the Multiple Listing Service. The figure is likely a few percentage points higher.

 Is this overall good news a harbinger of better things to come for the Charleston housing market? The stage is seemingly set for a turn to positive gain for home values, but all could be altered if reports of lenders being poised to release a larger portion of  foreclosed inventory becomes reality here locally. On the brighter side, prices are still at five and six year lows in the Tricounty and interest rates are at their lowest point, 3.98% for a fixed 30 year conventional loan, since 1981 when the yearly average was 16.63%

 Low prices and extremely low interest rates make this an extraordinary time to purchase a home for you and your family. Have you checked rent prices lately? This is another financially sound reason to buy now instead of putting it off and waiting for the proverbial "bottom of the market." When it does happen, most of the "experts" will have missed it and most of us non-experts will  again have waited too long to take advantage of a great opportunity. If you're happy in your current home and don't want to move, consider investing in rental properties. Again prices for homes are low and rental rates are quite good due to high demand and very low inventory. Buyers looking to occupy a home should also note that in most cases it is more expensive to rent a home now compared to total monthly payments on a like kind property that they could own.

Jim Hall
Realtor®
AgentOwned Realty
843.452.5521
Jim.Hall@agentownedrealty.com