Charleston, SC Posts

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When's the real estate hangover going to end? Why is it taking so long?

Check out How's Your Real Estate Hangover blog if you forgot what the party was like and why you have a  hangover.

You finally decide to face the music and wake up to face the ugly real estate hangover.  You have a splitting headache, dry mouth, and would really just prefer to stay in bed.  You drink gallons of water and take several aspirin and the headache is not going away. You want to scream, but you're afraid your head will split in half, so silently you scream, When is this hangover going to end?!   It's hard on everyone that came to the party. The banks lent too much money. Buyers bought too much house or got ARM financing that is about to reset. Those now sellers that bought at the peak feel like they are underwater and can't compete with the increasing inventory and builders trying to unload product. hangover

There really isn't an easy answer.  Hangovers last longer for some people as we all know.  Everyone is different just like every market is different.  But as one of our company leaders noted, a look closer at the many different factors, will reveal that we can say it's not over. Some think that we are just around the corner, but a reality check says otherwise.  Now, please note that I am not a pessimist. In fact, I'm probably guiltier of being too optimistic, but in times like these, it's time to be a realist.  I hope that the end is closer, but it's time to prepare for the worst.  It could be more like 12-18 months before we see a turn around.  First, the brunt of bank foreclosures may not have come to fruition yet.  It's a long legal process and it may be another 6-9 months before the mass inventory of foreclosures is really seen. This will put more inventory on the market at discount prices.  Second, there will be many more ARM resets in the months ahead for those buyers that bought at the peak of 2005 that could further lead to more inventory on the market as homeowners decide to get out of the loan by selling.  Third, a phenomenon we have never seen before is happening.  The walk away mentality.  Homeowners in fight or flight mode are walking away from their home and loan obligations without remorse.  I don't think we can pinpoint a time in history where this phenomenon occurred so much. 

Let's face it. The hangover is due to a HUGE IMBALANCE in our market today and in the past few years as building got out of control.  The imbalance is due not only in home values and home inventory, but also in lending practices and guidelines.  The pendulum has swung from one end and now to the other.  We need a healthy balance in order to return to equilibrium.  I think this is in the works.  As an agent, I do not create the market, but my job is to help buyers and seller respond to it.  With proper pricing (which may below the last sale and eat into part of your equity), excellent condition (meaning we may have to make some improvements) and the greatest marketing exposure possible (I'll handle this part for you), we can see the closing table.  The Charleston Relocation Expert has served over 150 families since 2004.  So far in 2008, I have assisted 35 families achieve their real estate goals. Allow me to be of service to you.

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Contact Michele Reneau, Realtor®, CRS, GRI, ABR, Carolina One Real Estate. Licensed Realtor® in South Carolina at 843-572-0518 to list your property for sale or to purchase a property in Charleston, Goose Creek, Summerville, North Charleston, Hanahan, Mount Pleasant and the surrounding areas in Charleston County, Berkeley County or Dorchester County, South Carolina. The Charleston Relocation Expert specializes in military relocation, first time homebuyers and creating marketing exposure to sell your home.  I can also be contacted by email at mreneau@carolinaone.com. To view all Charleston Metro area Homes for Sale Click Here and then click on Search for Homes.  With over 25 years of Lowcountry Living, I know the Charleston Metro area. I will help you get your home sold and/or help you buy your Charleston home or land.

P.S. If you are listing your home and need a quick sale in Charleston or surrounding area, make sure you hire an agent with the knowledge of the market and stats and the experience to get the job done.  I'll provide you with "Questions you should ask ANY agent before hiring" and share my my 100+ point marketing system.  Call me at 843-572-0518 to find out more selling your home in the Charleston SC Real Estate market. You can also view my newsletter by clicking here with the latest market stats updated on the 5th of each month.

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Michele Reneau, ABR, GRI, CRS

www.CharlestonRelocationExperts.com

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Comment balloon 9 commentsMichele Reneau • September 14 2008 12:59PM
When's the real estate hangover going to end? Why is it taking so…
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