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Real estate market in Charleston, seeking opinions from realtors, buyers, sellers, on market conditions, home prices, outlook of Charleston real estate market
Very good points. Although a bid from a willing buyer is better than no bid at all. My gut is telling me that Mt. P is a stack of dominoes right now. At some point, in some areas, it's going to take a few low-priced sales to make the whole line tumble to equilibrium. But I could be wrong!
My sentiments exactly and you are very astute. It is just a matter of time before the higher end homes start to fall....and fall they will. HARD. It has to happen. How else will the artificial appreciation of the bubble be mitigated? There is only one way.
[quote=USCJoe;6261671]There are currently 25 homes on the market in Hibben with 14 homes having sold this past year. The average discount from the last list price was 6.9%. This being said, there were many buyers who were able to purchase a home in Hibben at substantially less than this discount from earlier lists prices. When a negotiating tactic is to offer at least 30% below list without taking into consideration as how much the home has already been discounted, whether the home was listed origionally at a reasonable price,the floor plan, lot, lot location, quality of construction and other factors which are relevant to "fair market" value, they are doing themselves a disservice.[quote]
Is the past year 2007? Or is it to date? If it is year to date, then ~7% isn't a whole lot. If it is 2007 data, I wonder how many homes have sold in Hibben in 2008.
Also, 25 homes in that section is a substantial number. Barbadian Drive has at least 5 homes (finished or in distressed state) for sale.
Do you have the price range of homes that sold in Hibben?
There are four builders in that neighborhood who have their personal homes for sale. So if the builders are bailing, what kind of signal does that send to the other homeowners?
I would not mess with FSBOs. These sellers are probably in denial and will be difficult to negotiate with in most cases on the correct price. They will typically be time waisters.
I would go after new or under construction homes in the subdivisions you desire to live in. The reason is that these builders are probably "bleeding to death" and they will have a major incentive to wheel and deal. The builders that have multiple spec homes in these subdivisions are in a very precarious situation and need to clear inventory fast. If you play your cards right you can get a brand new home at a very good price.
You will also find some short sales in the mls with these type of homes if you get with an agent. The reason I know is that i just saw one in Belle Hall. Banks need money more than builders right now. Well actualy they are both desperate!!
My 3 cents.
I don't like trying to catch 'falling knives.' There is already enough blood on them!
My sentiments exactly and you are very astute. It is just a matter of time before the higher end homes start to fall....and fall they will. HARD. It has to happen. How else will the artificial appreciation of the bubble be mitigated? There is only one way.
Maybe. All I know is that it is happening here in Charlotte, and we have a huge white collar employment base (or did, who knows what will happend to Wachovia/Wells) and a demographic in our zip more affluent that even Mt. P (yikes). And prices all around us are falling beyond what the realtor assoc numbers are saying. I'm seeing it before my own eyes, so the evidence is anecdotal, but still real.
So if it is happening to a boom-town like CLT, well....
I see 4 homes for sale on Barbadian in the mls. I suspect that there could be one or more fsbo homes. The highest priced home that sold in Hibben this year sold on that street. It was new construction and acturally sold for more than what it was listed for. It is not unusual for a builder to put their own personal home on the market for many different reasons. I don't think that the fact that such homes are on the market is any indication of the state of the real estate market in Hibben.
I don't like trying to catch 'falling knives.' There is already enough blood on them!
I agree 100%. I made that comment to an individual who said they had to buy a home by January. I am against buying residential real estate right now in MP because I do not recommend buying a depreciating asset that shows ZERO sign of bottoming out right now in a deflationary environment. If I am representing a buyer that has to buy we are putting in offers way, way below list price. MP became one of the most speculative areas in Chas. and many subdivisions are high risk from an investment standpoint.
However, I am just one person and can not combat some of the real estate agents in this town that tell a different story to potential buyers. Even though I have a real estate license I do not participate in the retail residential market. Buyers who have come to me for advice are renting and saving money because the Price to rent ratio in Mt. Pleasant is completely out of whack. Subdivisions such as Hibben were speculated and nobody knows how many homes will foreclosure or get thrown up for sale in the next year and add to an already escalating inventory. The mls does not tell the entire story of many of these subdivisions with stats such as short sales, foreclosures and future homes coming on the market.
During the two years I have had a license in real estate I have not sold one house because I saw this collapse coming. I alarmed many people about the coming credit crisis problems in Sept 2006. Those who are purchasing homes in this current market are participating in a high risk investment. If you look at what has happened to the real estate market in Japan since 1989 you should excersize caution. Our banking and monetary system is very fragile right now.
I agree 100%. I made that comment to an individual who said they had to buy a home by January. I am against buying residential real estate right now in MP because I do not recommend buying a depreciating asset that shows ZERO sign of bottoming out right now in a deflationary environment. If I am representing a buyer that has to buy we are putting in offers way, way below list price. MP became one of the most speculative areas in Chas. and many subdivisions are high risk from an investment standpoint.
However, I am just one person and can not combat some of the real estate agents in this town that tell a different story to potential buyers. Even though I have a real estate license I do not participate in the retail residential market. Buyers who have come to me for advice are renting and saving money because the Price to rent ratio in Mt. Pleasant is completely out of whack. Subdivisions such as Hibben were speculated and nobody knows how many homes will foreclosure or get thrown up for sale in the next year and add to an already escalating inventory. The mls does not tell the entire story of many of these subdivisions with stats such as short sales, foreclosures and future homes coming on the market.
During the two years I have had a license in real estate I have not sold one house because I saw this collapse coming. I alarmed many people about the coming credit crisis problems in Sept 2006. Those who are purchasing homes in this current market are participating in a high risk investment. If you look at what has happened to the real estate market in Japan since 1989 you should excersize caution. Our banking and monetary system is very fragile right now.
Good night
Wow! Vegas is looking mighty nice!!!
In all seriousness, we have thought about renting to allow more inventory to come onto the market. But we have a house full of furniture to move and store to add to the rent, etc. etc....
Last edited by chardent; 11-23-2008 at 08:31 AM..
Reason: add more info
I agree 100%. I made that comment to an individual who said they had to buy a home by January. I am against buying residential real estate right now in MP because I do not recommend buying a depreciating asset that shows ZERO sign of bottoming out right now in a deflationary environment. If I am representing a buyer that has to buy we are putting in offers way, way below list price. MP became one of the most speculative areas in Chas. and many subdivisions are high risk from an investment standpoint.
Agree that there's no end in sight yet for the bottom....I'm thinking mid 2010 at the earliest. The dust will have settled a bit with the new administration and it's new economic policies and stimulus packages.
Nonetheless... so in this marketplace, where does risk equate to reward? 40% 50% 60% off list?
In the $900K to $2.0M new homes range (there are 93 listed), my thought is if I can negotiate 50% off asking price, I'll eliminate the bubble's artificial price appreciation and the other 20% reflects a discount based current economic conditions.
I'd like to stay out of neighborhoods where there's a lot of land left to develop (Dunes West, Hibben, Park West, Beresford Hall, etc) which would further stagnate my property's value. But at a 50% discount, 'the juice may be worth the squeeze' for buying in some of these areas.
Square foot wise, I am looking to pay no more than $150-$175/sf, regardless of the land value. That's my goal.
With my strategy, the Price to Rent calc is way out of wack as I can easily rent between $2K - $8K...but anything over $2K is overkill. I am looking more long term where at least I won't lose any value over the next 5 years.
I also am going to get killed on taxes, even more so if Obama's wealth redistribution plan takes affect.
Renting rather than purchasing a home in todays market certainly may make sense to many potential buyers. I do question the advise by CMR that " If I am representing a buyer that has to buy we are putting in offers way, way below list price." In my opinion, for a Realtor to give such generalized advise to a client without taking into consideration the list price and other factors relating to the true value of the home in today's depressed market, would be a doing a disservice to their clients. I believe that a Realtor needs to be able to evaluate a home on it's own merits, point out the positives and negatives of each home under consideration, discuss the price history and the competion and let the client decide whether to purchase a home for a certain price or consider a rental option based on anticipated time frame of ownership, their life style, tax issues and degree of financial risk. I compare a good Realtor to a physician. A physician will use their education and experience to evaluate a patient, explain the options of treatment and in many instances let the patient decide how best to proceed taking potential risks into consideration. A good Realtor should provide the same advise and options to their clients.
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