Welcome and Thank You!

I want to personally thank you for cheking out our blog and staying in touch with the real estate market in this area. I have a daily focus on the market and keep my finger on the pulse of each community we serve. I hope that you find the information contained here to be insightful and helpful and that your connection allows you comfort in relying on me for all your real estate needs no matter where you live in the country. Have an awesome day!

Wednesday, January 29, 2014

Frozen Day at the beach!

Mark January 29, 2014 as the day that time stood still!  Not much snow from the winter storm at the beach, but plenty of ICE!  It was a tricky ride to the office today, but no accidents or issues.  Looking forward to warmer temps in the days ahead!  Stay Tuned!

Monday, January 20, 2014

2013 appeared to be an amazing year for the Real Estate market nationally, but how did it fare where your property is located?  You've heard that Real Estate is Hyper-local and that proved to be very true along the Grand Strand in 2013.


Welcome to 2014; the year of the Amazing Real Estate market, right?  If you are a believer that past performance is an indication of future results you are taking the 2013 results and increasing them for this year, right?  Well, I have the good fortune to speak with dozens of people daily that have learned a lesson in Real Estate over the past 5 years and most are not on the bandwagon.  Before we look ahead to what may be in 2014, let's look back to 2013 and see how it fared against the previous year of 2012.  We have to see where we have come from, annualized, to see where we may go this year.  In its entirety, 2013 did prove to be a good year for housing.  Selling volume and sales prices were broadly higher in 2013 while inventory levels and days on market were lower.  The Grand Strand's inventory started the year with 9.5 month supply of homes and 10.5 month supply of condos (including Town homes) and ended the year down 15.7% & 5.6% respectively.  The tightening of the supply side aided in homes that sold getting slightly better selling prices with homes up 5.5% and condos up 2.5% for the year.  Been a while since any increase in pricing has been discussed, right?  Good News!  As for the demand side; single family homes had a whopping 19.2 annual increase and condos saw a 5.4% increase!  Remember these numbers.  The amount of time it took to get a property sold decreased slightly over the year with homes being down 6 days and condos down 9 days.  In review, the market had good positive numbers for the year along the Grand Strand with a gradual. slow climb out of the low levels it reached and has remained since 2010.  How can you use this information to look ahead?  Well, there are a few important numbers I believe can give us a general idea of what may happen.  As with any market you need to look at the supply vs.demand and the outcome.  Take a look at the previous numbers of single family home demand - UP 19.2% from the previous year, which effected pricing by 5.5%.  Would it be safe to think that another 19% increase would net us another 5.5% increase?  Sure, but there are other factors too; mainly the supply.  The Supply of homes did continue to decrease throughout 2013 and the decrease had a positive effect on pricing too.  I don't believe it will be the same in 2014.  There are two important things happening in the market right now that will effect supply in 2014; First, builders are building again.  Ride through any of the neighborhoods that have sat quiet that last few years and you'll see it happening.  The trucks are back and the cranes are flying trusses.  New Home construction will be a player in the supply side of the market this year.  Second, the holders-on are moving forward now.  The homeowners that haven't been able to swallow the market pricing over the past few years are going on the market now.  Many of these sellers are priced way out of the market, but they are on the market.  Some never left!  I actually came across a listing the other day that had been on the market for over 2,000 days!  It is an injustice!  Anyway, these homeowners will supply the market with homes at least for the first part of the year in hopes that the market has come up to meet their selling price.  In many cases, it won't.  There are also two important things that will happen in mortgage lending that will impact home sales in 2014.  First, rates will be higher.  Many estimate rates to jump to 5.5% range in the first quarter.  While it is still an amazing rate the threshold has been set and most Buyer's will be disappointed that 4.5% is not available any longer.  Others that can still afford to buy will hold back for a few months hoping for a rate decline before coming back in the market.  The second thing is the QM Rule.  The Qualified Mortgage rule is part of the Dodd-Frank act and will eliminate more Buyer's from qualifying for a mortgage.  There are industry-wide restrictions that cannot be broken by lenders in an effort to reduce high-risk loans.  This is another of the safety nets put into place after the real estate meltdown that will prevent 2006/2007 real estate markets from ever happening again.
Looking into the future (and making some assumptions), I see a market very similar to last year ahead of us.  I believe both single family homes and condos will see low single digit appreciation with higher than expected demand.  We will continue to see pockets of distressed (primarily Foreclosure) properties in the market, but the saturation levels should remain below 8% overall.  Short Sales have simply become so difficult for approval due to lender valuation many sellers aren't even trying any longer.  I do believe interest rates will rise, but our Buyers along the Grand Strand are generally smart to understand the small impact 1% can make.  Investors will remain in the market, but won't be the driving force this segment was in 2012 or 2013.  Certain sub-markets will see very high demand and the great properties in these markets will get multiple offers before selling, but only at what the market will bear.  Many Buyer's still know there is selection out there and won't get caught up in fighting over a market price.  The balance of pricing will be somewhat controlled by New Home supply, at least in single family homes.  There won't be any volume in condo New Construction until 2015 or 2016.  
I am very excited about the market ahead for both Buyer's and Seller's.  We won't be back in a market that sees 20% appreciation in a year, but given where we've been I think 3% - 5% appreciation is something to get thrilled about!
If you would like a full 13 page detail of the market in review emailed to you just let me know.  Email me at ben@benguyton.com with 2013 Market Report in the subject line.
I look forward to our next conversation!