home prices continue to drop? (Charleston, Mount Pleasant: sale, mortgage, how much)

[echobeach]

We are planning to be in Charleston by the end of April and have rented a 2BR/2Bath condo out of necessity: we need a place to move our "stuff" to when we "close" here...and we need to stay here a bit longer to finish up job-related obligations. (I just passed the clinical licensing exam that will allow me to practice in South Carolina!). It did not seem to make sense to put "stuff" in storage for a brief time and then have to pay to move it again in such a short period of time.

So it would seem our plan to rent first has been endorsed by this thread...I get postings on properties on James Island from a fantastic broker we have been working with since initially thinking of moving to Charleston. The prices on SPECIFIC properties on JAMES ISLAND have fluctuated a substantial amount since we have been looking at them last November. After jumping up just a bit over the winter, lately it seems sellers are shaving a least $10K off the price of quite a few properties in the $200-300K range - and the newer homes seem to be dropping faster (but in general they have NO land). I appreciate the feedback from this board -- it only reinforces that we will be able to get a simple home for a reasonable price by the end of this year.

To those loking for rentals: its a renter's market too - very easy to get a rental. There are tons of rentals on the market and most of what we came across had more flexible terms than one would think....one of the reasons we rented so soon was we found this unit in my nephew's complex and were able to negotiate down to a six-month followed by month-to-month lease vs. the year lease they wanted...plus they even rented us beginning in the middle of the month beginning March 15th vs. the March 1 date they originally "needed" to rent by-- saved us a 1/2 month's rent. Another unit was willing to drop the price (but they would not negotiate the lease). The agent for the property was just very very nice...and unlike in New York City we did not have to pay the agent a broker fee! (The last time I rented - over 9 years ago - I paid the broker $1500 for the priviledge of renting a tiny, unkempt, hole that was just over 200 sq ft. but located in a desireable neighborhood!!! If you have lived in the northeast then its a wonderful shock that you don't pay the broker on rentals!)


Good luck to all!

[Jim3310]

Originally Posted by emilybh

I beg to differ. If someone has had their house on the market for more than 6 months or more than a year and they need to sell; have had few showings and no offers, a low ball offer is better than no offer at all.

Emily,
I don't know where we differ, and hardly anyone begs anymore.

First, If they had their house on the market for more than a year and they need to sell, they did not NEED to sell! They may like to sell, but they didn't need to sell.

As I said, "If the homes are priced correctly and the seller is not basing their listing price on 2 years ago, it will sell."

If your home has been on the market for 6 months or more, with no showings, believe me, there is something wrong.
I show properties all week long, full time.

There are lots of properties I don't show. Why is that Jim?

If people ARE coming through your home, and you get no offers:
a. It's the condition or b. You are overpriced and agents are using you as a comparison & selling a similar property that is priced right.

If people ARE NOT coming through your listing at all:
It's either the price or the location. Plain & simple.

The people who have that property listed have been told that it is priced too high. It is their decision to price it out of the competition. Believe me, they won't take an offer of 30% less.

We agree in theory, I just know it in practice because I do this everyday.
jim

[emilybh]

Originally Posted by Jim3310

Emily,
I don't know where we differ, and hardly anyone begs anymore.

First, If they had their house on the market for more than a year and they need to sell, they did not NEED to sell! They may like to sell, but they didn't need to sell.

As I said, "If the homes are priced correctly and the seller is not basing their listing price on 2 years ago, it will sell."

If your home has been on the market for 6 months or more, with no showings, believe me, there is something wrong.
I show properties all week long, full time.

There are lots of properties I don't show. Why is that Jim?

If people ARE coming through your home, and you get no offers:
a. It's the condition or b. You are overpriced and agents are using you as a comparison & selling a similar property that is priced right.

If people ARE NOT coming through your listing at all:
It's either the price or the location. Plain & simple.

The people who have that property listed have been told that it is priced too high. It is their decision to price it out of the competition. Believe me, they won't take an offer of 30% less.

We agree in theory, I just know it in practice because I do this everyday.
jim

I think that a lot of sellers are living in a dream world that they can still get what people were getting 2 years ago for their home and their listing agents are too afraid to be frank with them about realistic pricing and the agents are still hoping a deep pocketed northerner who is not that familiar with the market will come along and pay close to the asking price. If I was a realtor, i wouldn't take a listing unless the seller was willing to price it based on recent
comparable sold prices within the last three months.

Having followed the market here for over two years I've noticed some properties that are STILL on the market and are also listed for rent (at too high an amount) and even after rent reductions, the properties remain vacaant. You're right. Those owners must not care about getting rid of the property if they let it sit that long. I guess I should have said if sellers WANT to sell their homes, if the only offer they get is a low ball offer, they might be better off taking it than to wait for years for the market to turn around or perhaps get an even lower second offer. Some of those who WANT to sell I'm also putting in the NEED to sell category because they may end up upside down owing the bank more than the buyer is willing to pay for the property at the closing.

[pokrplr]

Correct me if i'm wrong but doesn't location have a lot to do with it?? We sold our home in Crowfield, Nov of 2007 in a RECORD 29 days on market, full price at that...We did not give it away either, if anything it was priced above current value's as we did the comps for our area. Our sq ft price was above anything else listed (with exception) of the home's in the Hamlets...
Maybe we were just lucky?!

[SCDweller]

Location has always been one of the key factors in a home's desirability. There are certain areas that will (almost) always be in demand simply because of their location. Jim is correct in his assesment of homes that are not receiving showings or offers. Listings that are priced correctly and sellers are listening to their agents recommendations regarding staging will be shown and sell. I have seen an increase in the showings and sales of my properties since the beginning of 2008.
The rule of thumb for buying a home has always been if you are going to stay in the home for 3-5 years, you will come out on top. Less you run the risk of losing equity. In this market, you may want to say 4-6 years. Make sure you have a realtor assist you who has weathered the ups and downs of the SC market and knows how to help you write a smart offer that will secure you the right home.

[Browsing Duo]

Here's a recent experience with Charleston real estate:

First-time young buyers started looking for a house in May, 2007 but couldn't afford anything they wanted on the Charleston peninsula in the $300,000-$400,000 range downtown where they want to live. In January, 2008, they started looking again. This round, they saw that some of the very same houses that had been out of their price range last year had come down tens of thousands of dollars and were still on the market after many months or pulled then re-listed at lower prices and still not selling. The bear market for houses had kicked in, even in Charleston, which is stronger than a lot of areas.

The couple had three "Top 3 Houses" so as not to get too attached.

They negotiated with one "Top 3" that had been re-listed at a lower asking price than when it first went on the market last summer. The couple offered too little and the owner said no. So the couple came up with a second and final counteroffer within a few thousand dollars of the seller's re-listed asking price. The owner refused. That owner, obviously, did not "need" to sell despite the house being listed for such a long time. The couple walked away.

A week later, the couple made an offer on a second "Top 3" house that had been on the market for nearly a year at a much, much higher asking price. This time the new asking price was within the couple's ballpark, so the couple counter-offered $20,000 below the new asking price. Seller then counteroffered $10,000 below their new asking price if they could close in a month. The couple accepted and close in a few weeks. The second seller "needed" to sell because of a job transfer. The house is a much better deal than the first one. Of course, if real estate keeps tanking, it won't be a "deal" for the couple anytime soon.

So some sellers can wait out this squirrely market, but others need to move and are eager to make a deal if they've been on a long time. If it were me, I'd wait another year to buy anything. Then again, I sold my own house in two weeks last August (not in Charleston) and just squeaked through with that. Our buyers, unfortunately, had their own house sale fall through when their prospective buyers no longer qualified for a mortgage. So now the people who bought our house are carrying two mortgages. There's a lot of this going around. The banks are getting a lot tighter. . . and should! What's the use of the President bragging a couple years ago about the higher rate of homeowners if those people should not have qualified for mortgages if the lenders had half a brain in their greedy heads Oh, well, a whole 'nother subject.

[emilybh]

Originally Posted by Jim3310

Emily,
I don't know where we differ, and hardly anyone begs anymore.

First, If they had their house on the market for more than a year and they need to sell, they did not NEED to sell! They may like to sell, but they didn't need to sell.

As I said, "If the homes are priced correctly and the seller is not basing their listing price on 2 years ago, it will sell."

If your home has been on the market for 6 months or more, with no showings, believe me, there is something wrong.
I show properties all week long, full time.

There are lots of properties I don't show. Why is that Jim?

If people ARE coming through your home, and you get no offers:
a. It's the condition or b. You are overpriced and agents are using you as a comparison & selling a similar property that is priced right.

If people ARE NOT coming through your listing at all:
It's either the price or the location. Plain & simple.

The people who have that property listed have been told that it is priced too high. It is their decision to price it out of the competition. Believe me, they won't take an offer of 30% less.

We agree in theory, I just know it in practice because I do this everyday.
jim

Jim. It all depends how badly they want to sell. If they've had the house for 20 years, it isn't like they have to get top dollar for it. If they've had it on the market for 6 months or longer and haven't gotten any offers except a low ball offer, they can counter to try to get the buyer to raise the offer but if the buyer doesn't want to pay anymore than X amount for whatever reason and no other buyers come along, that seller would be better off selling the property for whatever he can get (in this market anyway) and moving on.... rather than having to sit on it for untold months or years before another buyer comes along who maybe doesn't even make as high as the first offer was!

A friend who was a real estate agent said she used to make low ball offers all the time on investment properties and if the seller didn't accept the offer initially but later came back after getting no other interest from other buyers, she'd tell the seller she now wasn't even willing to pay what she originally offered but would be willing to pay X dollars less than the first offer.

I was afraid that was going to happen to me because I initially turned down the only offer I got on my place in Newport, RI but even after returning the P&S and the binder check, the buyers still wanted it and were willing to pay the same amount two months later.

The only buyers who will pay more than they probably could get away with paying for a property are people who make the mistake of falling in love with it.

[echobeach]

I got an automated quote today from my bank for a 5.25% mortgage - 30 year fixed - could that possibly be right? AND how do y'all feel the lower rates affect the housing marker in Charleston? Will prices go up? Seems to me if you are looking for the bottom of the market and waiting it makes more sense to catch a low interest rate and buy while the market is low, if not at its lowest. Thoughts & Comments?

P.S. to Emily: I know what you mean about falling in love with a house and "having to have it" but I do want to love my home or at least something about it or why bother? Yes you need to compromise b.c. most of us cannot afford EXACTLY what we want but you should still get some lovin' if you are going to live there.

[USCJoe]

5.25% on a 30 year fixed mortgage seems awfully low to me. How many loan origination points were you to be charged and were there any additional fees associated with the loan for which you are not receiving a service ? You really need to get a "good faith" estimate when quoted an interest rate to compare apples with apples. Keep in mind however, that a good faith estimate is only that and in my opinion less than "good faith" by some lenders when you get to the closing table. I personally do not think that a lowering of interest rates will have a great impact on the housing market in Charleston as well as in other parts of the country due to the fact that it has not been high interest rates that has hurt the housing market but loose lending standards that were followed by many lenders the past few years and the lack of confidence that so many potential buyers have in the economy and their economic future. I do agree that it makes sense to buy when rates are historically low, when you plan to be in a home for a number of years and you are able to find a home to your liking in the price range in which you feel comfortable.

[meks]

Originally Posted by echobeach

I got an automated quote today from my bank for a 5.25% mortgage - 30 year fixed - could that possibly be right? AND how do y'all feel the lower rates affect the housing marker in Charleston? Will prices go up? Seems to me if you are looking for the bottom of the market and waiting it makes more sense to catch a low interest rate and buy while the market is low, if not at its lowest. Thoughts & Comments?

it isn't at it's lowest... I refinanced several years back, did it for 15 yrs at 4.25% fixed

that only raised my monthly less than $100 and the house is now almost 1/2 paid off

even the 30 yr fixed was under 5% back then

it may go even lower with the economy in it's supposed bad state

I agree emily... if you "need" to sell you better take what you can get these days, I see lots of band-aids but no fixes in the near future for the economy