Monday, March 23, 2009
Market Update
This was sent to me by one of my sellers (written by an anonymous author) about the Charleston Real Estate Market:
Market Review
March 20, 2009
The 2009 real estate market is off to a slow start. The first two months of 2009 saw the number of Tri-Countytransactions drop 42% from the same two-month period in 2008. Since November, the number of transactions that occur each month have been roughly one
third of what they had been during the corresponding months of peak year 2006. The monthly number of transactions is roughly half of the average number of corresponding monthly transactions over the last nine years.
In January, the median price of a home sold in the Tri-County region was $177,500, down 16% from the $210,600 median price of a home sold in January of 2008. In February, the median price of a home sold in the region had climbed back $7,400 to $183,900. This $183,900 median price was 10% less than the $205,000 median price experienced in February of 2008. Expect to see a bumpy plateau of median price fluctuation between $170,000 and $210,000 in each month of 2009. This is because in any given month, there may be more discounted homes sold at the higher end of the market than there are in the low end of the market.
Take I’On for example. Below is a table showing the five homes that have closed in the neighborhood thus far in 2009.
The lowest price home - 90 North Shelmore - sold for $690,000, or 95% of the list price (87% of original list price). The highest price home – 15 Eastlake – sold for $1,135,000, or 91% of the list price (73% of original list price). The median price of the five homes sold was $1,050,000, substantially greater than the $815,000 median price of the 54 homes sold in I’On in 2008. The increase in median price was due to greater discounting at the higher end of the market. Such discounting will happen throughout the Tri-County region, but particularly in those areas like downtown Charleston and the islands that experienced the greatest price appreciation prior to the bubble bursting.
Foreclosures, short sales, and high inventory levels will continue to put downward pressure on prices in I’On and throughout the Tri-County region. Nevertheless, because of greater discounting at the high end of the spectrum, by year end I wouldn’t be surprised to see the 2009 median price for the Tri-County area near or slightly above 2008’s $205,000 median price. To reiterate, this wouldn’t necessarily mean the market improved, it would just reflect greater discounting at the higher end.
Image removed by sender.
I’On inventory. As of this writing, three homes are under contract. Normally, there are at least nine under contract this time of year. 83 homes are listed for sale. Two of these 83 listings are for homes that have yet to be started, and two more are for homes still under construction. Taking away these four, leaves 79 completed homes on the market in I’On. These 79 homes range in price from $499,000 to $2,700,000 with an average asking price of $1,100,000. They have been on the market for periods ranging from a few days to almost 4 years, with an average of 14 months.
12 of the 79 homes were recently listed (placed on the market since the beginning of the year). Of theremaining 67 placed on the market before January 1, 2009, one was listed in 2005, 10 were listed in 2006, 23 in 2007, and 33 were listed in 2008. The prices of 34 of those 67 have been reduced since January 1st. These reductions have ranged from $10,000 to $230,000. If you have a home on the market and are seriously interested in selling it, then given the state of the economy, the dearth of homes under contract, and the recent sales comparables, consider reducing the price or further reducing the price.
With the “Ides of March” just past, this famous passage from Shakespeare’s
Julius Caesar seems a timelyreminder for pricing strategy:
There is a tide in the affairs of men.
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat,
And we must take the current when it serves,
Or lose our ventures.
Some recent good news:
1. Mortgage rates have fallen again, making home ownership even more affordable. If you haven’t refinanced your home in a while, now would be a good time to do so.
2. Ground was recently broken on four new homes in I’On. Three of those are custom homes. Now is a fantastic time to consider building a home as construction costs are the lowest they’ve been in a long time.
3. The fourth of those homes started last month will be
Coastal Living magazine’s 2009 “Idea Home.” Built by Structures on Jefferson Canal, this home will be open for tour in late summer and be featured in the October issue of the magazine. The first ever Coastal Living Idea Home was built on Sowell Street in 1998. We are proud to have been selected once again.
4. Several more homes will start over the next three months. They will be built on lots recently sold as part of the I’On Company’s Holiday Home Site Sale.
5. You may have heard the announcement of our new sales and marketing collaboration with William Means! I’On Realty is very excited about this new relationship and are proud to have them working alongside us to help sell homes in I’On.
6. Spring has returned to the Lowcountry!! Celebrate!!!
Market Review
March 20, 2009
The 2009 real estate market is off to a slow start. The first two months of 2009 saw the number of Tri-Countytransactions drop 42% from the same two-month period in 2008. Since November, the number of transactions that occur each month have been roughly one
third of what they had been during the corresponding months of peak year 2006. The monthly number of transactions is roughly half of the average number of corresponding monthly transactions over the last nine years.
In January, the median price of a home sold in the Tri-County region was $177,500, down 16% from the $210,600 median price of a home sold in January of 2008. In February, the median price of a home sold in the region had climbed back $7,400 to $183,900. This $183,900 median price was 10% less than the $205,000 median price experienced in February of 2008. Expect to see a bumpy plateau of median price fluctuation between $170,000 and $210,000 in each month of 2009. This is because in any given month, there may be more discounted homes sold at the higher end of the market than there are in the low end of the market.
Take I’On for example. Below is a table showing the five homes that have closed in the neighborhood thus far in 2009.
The lowest price home - 90 North Shelmore - sold for $690,000, or 95% of the list price (87% of original list price). The highest price home – 15 Eastlake – sold for $1,135,000, or 91% of the list price (73% of original list price). The median price of the five homes sold was $1,050,000, substantially greater than the $815,000 median price of the 54 homes sold in I’On in 2008. The increase in median price was due to greater discounting at the higher end of the market. Such discounting will happen throughout the Tri-County region, but particularly in those areas like downtown Charleston and the islands that experienced the greatest price appreciation prior to the bubble bursting.
Foreclosures, short sales, and high inventory levels will continue to put downward pressure on prices in I’On and throughout the Tri-County region. Nevertheless, because of greater discounting at the high end of the spectrum, by year end I wouldn’t be surprised to see the 2009 median price for the Tri-County area near or slightly above 2008’s $205,000 median price. To reiterate, this wouldn’t necessarily mean the market improved, it would just reflect greater discounting at the higher end.
Image removed by sender.
I’On inventory. As of this writing, three homes are under contract. Normally, there are at least nine under contract this time of year. 83 homes are listed for sale. Two of these 83 listings are for homes that have yet to be started, and two more are for homes still under construction. Taking away these four, leaves 79 completed homes on the market in I’On. These 79 homes range in price from $499,000 to $2,700,000 with an average asking price of $1,100,000. They have been on the market for periods ranging from a few days to almost 4 years, with an average of 14 months.
12 of the 79 homes were recently listed (placed on the market since the beginning of the year). Of theremaining 67 placed on the market before January 1, 2009, one was listed in 2005, 10 were listed in 2006, 23 in 2007, and 33 were listed in 2008. The prices of 34 of those 67 have been reduced since January 1st. These reductions have ranged from $10,000 to $230,000. If you have a home on the market and are seriously interested in selling it, then given the state of the economy, the dearth of homes under contract, and the recent sales comparables, consider reducing the price or further reducing the price.
With the “Ides of March” just past, this famous passage from Shakespeare’s
Julius Caesar seems a timelyreminder for pricing strategy:
There is a tide in the affairs of men.
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat,
And we must take the current when it serves,
Or lose our ventures.
Some recent good news:
1. Mortgage rates have fallen again, making home ownership even more affordable. If you haven’t refinanced your home in a while, now would be a good time to do so.
2. Ground was recently broken on four new homes in I’On. Three of those are custom homes. Now is a fantastic time to consider building a home as construction costs are the lowest they’ve been in a long time.
3. The fourth of those homes started last month will be
Coastal Living magazine’s 2009 “Idea Home.” Built by Structures on Jefferson Canal, this home will be open for tour in late summer and be featured in the October issue of the magazine. The first ever Coastal Living Idea Home was built on Sowell Street in 1998. We are proud to have been selected once again.
4. Several more homes will start over the next three months. They will be built on lots recently sold as part of the I’On Company’s Holiday Home Site Sale.
5. You may have heard the announcement of our new sales and marketing collaboration with William Means! I’On Realty is very excited about this new relationship and are proud to have them working alongside us to help sell homes in I’On.
6. Spring has returned to the Lowcountry!! Celebrate!!!
Labels: Charleston SC Real Estate Statistics
