2008 was a challenging year for the overall economy and for the real estate market in particular. Our fearless company leader, Patty Scarafile put it best: "We added new buzz words to our everyday language like, "financial meltdown", "subprime mortgage crisis" and "mortgage backed securities" and listened to the news media explain how foreclosures have risen to historic highs and real estate values fell month after month." In Metro Charleston, MLS closings were off over 30% from 2007 and the average sales price declined by approximately 2 %. The number of sales in 2008 were similar to 2001 - 2002 levels, but with double the listing inventory.
Looking forward to 2009, many economists predict a year similar to 2008 and, while we are prepared to continue to weather the storm, there are some hopeful signs on the horizon. Regardless of your political position, a new president and new administration provides the chance for a fresh start and a sense of renewed optimism. Washington understands that a stronger housing market is key to an economic recovery and they have already taken steps that have positively affected interest rates and are likely to take further action in the future. There is considerable pent up demand and, with interest rates at historic and unprecedented lows, selection high, and prices more affordable, we are already starting to see greater activity in our local market with January showings at a peak since the summer of 2008.
2007 brought a different reality to the Charleston SC real estate market. It was probably the first year that the hangover sank in. I'm referring to the real estate hangover from the party we had in 2003-2005 with soaring appreciation and easy lending. Long gone are the days of short term days on the market and 15-20% appreciation rates in 12-24 months. 2007 closed out with 12,998 sales with an average sold price of $298,605 with an average days on market of 79 days. Houses that sold enjoyed a 96% list to sale ratio. 2007 also saw a soaring increase of inventory for a total of 27,770 new listings with an average list price of $385,212. The average days on market for the active inventory was 142 days.
The good news of 2008 was that inventory totals did decrease down to 22,082 properties (a 20% decrease). The average list price was $389,132 down slightly just under 2%. Average 109 days on the market was extended from last year's average at 79 days. The not so good news is that active listings have currently been on the market for an average of 198 days. Sellers that are successful are getting serious on price and offering major incentives such as closing costs, interest rate buy downs and even other big ticket items like boats, flat screen TVs and cars.
Sellers that want/need to sell may have to consider making improvements to attract buyers (possibilities include: neutral paint, hardwoods floors, updated kitchen and baths), offering incentives or reducing the price as their biggest competitor is new construction homes. With average showings only 2-3 per month per house, only the best looking AND best priced homes will show. Almost half of closed sales in Berkeley County were new construction.
While depreciation set in for the 1st time since in almost 20 years, it is not as bad as one might think. Many places in the nation have decreased by double digit numbers. For Charleston to only suffer a 1.99% decline still speaks volumes about the strength of our market. This is simply a correction of the over inflated prices we have seen in the past as well as a response to current supply and demand. The tightening of finance guidelines have also changed the number of available buyers but that doesn't mean that banks aren't lending. Real estate is still a great long term investment!
See below for a breakdown of numbers from 2003-2008. Appreciation rates reflect realized appreciation for those properties that sold in the given year. Historically, healthy appreciation rates hovered between 2-5%.
Year New listings # Sold Avg Sold $ Avg DOM %SP/LP % +- app
2003 16,486 11,720 $225,545 140 97.08% 4.83%
2004 18,834 14,277 $252,997 80 97.47% 10.85%
2005 24,023 18,074 $277,875 61 98.13% 8.95%
2006 28,782 16,760 $290,687 68 97.26% 4.4%
2007 27,476 12,653 $298,545 96 96.46% 2.63%
2008 22,082 8,811 $292,594 104 95% -1.99%
For 2009, my prediction is that it will still be a good year for real estate in the Charleston market as buyers take advantage of LOW interest rates and some amazing deals being offered. I think we will maintain the same number of closed sales this year and buyers looking to make a long term investment will be achieving their goal to get a home at historical low prices combined with a low interest rate. I believe that as inventory stabilizes over 2009 and possibly 2010, it will position 2011 as an up year. Real Estate is still a good long term investment. Ask me about the rate of return on real estate or the stock market in the last 10 years. If you or someone you know would like a breakdown of a particularly area or neighborhood, please email me at info@CharlestonRelocationExperts.com.
Although difficult, we ended 2008 stronger than we started. Carolina One Real Estate increased our market share to 30% gaining 4% over 2007 and outpaced the competition with the next competitor with 7% market share. Carolina One Real Estate continues to be the clear market leader in Metro Charleston with highly productive and dedicated agents working in 1 of 12 strategically positioned offices that service every market area. We continue to be the market leader because we are cutting edge in our technology and continue to always keep foremost in our minds what our clients want and need. Our core values remain the same and we are progressive, energetic, committed and strong.
The Charleston Relocation Experts Team was blessed to have a phenomenal 2008 along with many accolades. Thank you for your business, your support and the referrals of your family, friends, colleagues and neighbors. In the face of a changing market, we sustained our level of activity and Michele Reneau was recognized as a Carolina One Top Producer for 2008 and the company's Most Closed Units in 2008! She was also recognized as a Realtor of Distinction by the Charleston Trident Board of Realtors. These huge accomplishments continue to place Michele Reneau in the Top 1/2% of Charleston's 4700 realtors. Michele was also nominated by RESA as 2009 Staging Realtor of the Year and was selected to be featured on the February cover of Real Estate Executive Magazine. Experience does count. Let it work for you or someone you know that is thinking about buying or selling real estate. Please call us for a FREE no obligation consultation. Wishing you a blessed 2009!
Michele Reneau - Military Relocation Specialist with Carolina One Real Estate in Charleston, SC.
Contact Michele Reneau, Top Real Estate Agent, North Charleston, SC Relocation Expert, CRS, GRI, ABR. Licensed Realtor® in South Carolina at 843-572-0518 to list your property for sale or to purchase real estate in Charleston, Goose Creek, Summerville, North Charleston, Hanahan, Mount Pleasant and the surrounding areas in Charleston County, Berkeley County or Dorchester County, South Carolina. Featured on HGTV's House Hunters. Publisher/Author for Charleston Real Estate Update including featured listings and sold properties, and monthly statistics on Charleston Real Estate Market. RESA 2009 Staging Realtor of the Year Nominee. The Charleston Relocation Expert specializes in military relocation, first time homebuyers and creating marketing exposure to sell your home in the Charleston SC Real Estate market. I can also be contacted by email at email@example.com. To view all Charleston Metro area houses 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.
Copyright © 2009 Michele Reneau, CharlestonRelocationExperts.com.