Charleston home market rebound
Chris DeLoach, ABR, BIC
In Charleston, the signs of fall are all around us. So are the signs of a Charleston real estate market rebound.
The Charleston market is showing clear signs that a modest price recovery is underway. Homes are staying on the market for less time. Homes that are priced "below market" often are receiving multiple offers. Investors are returning and with them we are starting to see some cash deals once again.
While we are certainly a long way from where we were two years ago when a home could sell in a matter of hours, there is no longer any debate that things are improving in the Charleston market. The Charleston market survived reasonably well in comparison to most other markets during the downturn. Our price declines were modest. Charleston has always been, and continues to be, a very popular area. Those factors, combined with a diversified economy, support market stability and the ability to rebound quickly.
In Aug, our area pending sales increased 23.8% over August 2008. That wast he largest increase in the Charleston market since 2005. Home prices jumped 3% over July. Inventory of listed homes on the MLS dropped as well.
In my own neighborhood, a year ago the typical home remained on the market for six months. In the past four months, I can recall three listings that received contracts in under a month (two in less than a week) - in a neighborhood that averages about five active listings at any given time. We are seeing very definite improvements all around the area.
The single most significant factor that has worked to hold prices down in our area this year has been the number of bank properties and short sales. The inventories of both bank properties and of short sales are being worked off rapidly. When we have passed the point where these properties impact pricing, I expect to see a relatively quick, but short lived modest surge in home prices. The jump will be followed by a leveling into a gradual increase in prices - maybe to 3% to 5% increase per year - for the next couple of years. After that, I would expect appreciation to be slightly higher.
Attention Charleston home buyers: interest rates will rise again. Although there is not a direct correlation, one can look to the perspective of the central banks to get an idea as to how soon we should start to see some changes. Australia's Central Bank raised rates to 3.25 last week. I suspect Bernanke will need to start putting the brakes on our own economy by tightening the money supply by springtime if not sooner. In my opinion, interest rates will be at least 1 point higher by this time next year.
Yes, we are still in a buyers' market. Yet, there is little doubt that the amazing deals we have seen this year and last year will fade soon. Today, serious bargains are already dwindling in number and now face increasing buyer competition. We are slightly past the market bottom. For the next several months, maybe until mid next year, there will still be some very nice bargains in the Charleston home market.
If you are a buyer, this may well be as good as it gets! For you sellers, good news. Things are slowly getting better - much better.
Chris DeLoach, ABR, BIC
House Plan Realty, LLC
843-654-4578
www.chrisdeloach.com
Chris@houseplanrealty.com
Filed under: Buyer Information, Selling your home, Charleston new homes, selling in Charleston, charleston real estate, charleston mls, Charleston market conditions, charleston home sales, charleston market, charleston homes for sale, using a buyers agent, short sales, charleston, summerville short sales, charleston short sales