Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > U.S. Forums > South Carolina > Charleston area
 [Register]
Charleston area Charleston - North Charleston - Mt. Pleasant - Summerville - Goose Creek
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 07-13-2009, 06:28 AM
 
Location: Hingham, MA
63 posts, read 203,067 times
Reputation: 27

Advertisements

We will move here in 2 to 3 years. What is the forecast for home prices for 2011 & 2012 on DI?

Last edited by PapaJim; 07-13-2009 at 06:31 AM.. Reason: misspelling
Reply With Quote Quick reply to this message

 
Old 07-13-2009, 11:07 AM
 
Location: Mount Pleasant South Carolina
1,125 posts, read 3,767,672 times
Reputation: 239
I think you are going to find it difficult to get any objective opinions as to the state of the real estate market in the Charleston area, even on Daniel Island 2-3 years from now. I personally feel that Daniel Island prices have been less subject to normal supply and demand factors than much of the rest of the Charleston area. Homes have traditionally sold for more than comparable homes in the town of Mt. Pleasant since the inception of this community and I find it difficult to see what justified that difference. I also feel that home prices in Mt. Pleasant will recover quicker than those on Daniel Island, although this is just a "gut" feeling and difficult to support with objective data. However, the below chart of recent sales and inventory history of single family homes on Daniel Island may provide "food for thought."



Quote:
Originally Posted by PapaJim View Post
We will move here in 2 to 3 years. What is the forecast for home prices for 2011 & 2012 on DI?
Reply With Quote Quick reply to this message
 
Old 07-13-2009, 02:18 PM
 
Location: Charleston, SC
159 posts, read 315,683 times
Reputation: 69
Quote:
Originally Posted by PapaJim View Post
We will move here in 2 to 3 years. What is the forecast for home prices for 2011 & 2012 on DI?
Easy answer......Down.

Almost everything on the upper end is in trouble in Chas.
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 04:31 AM
 
Location: Charleston, SC
159 posts, read 315,683 times
Reputation: 69
By the time you move to Chas. may be a great time to purchase. Many predict a bottom around 2011-2012 but this type of forecasting is difficult to be accurate on. I would save your money for a down payment because there should be some good value deals in 2 to 3 years on DI.

Good luck!
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 02:27 PM
 
210 posts, read 747,167 times
Reputation: 74
CMR,

There seems to be two ways to purchase on Daniel Island. A person can buy a lot, or they can buy a house.

Daniel Island's pricing, on existing homes, is very high, but so is the cost of buying a lot.

Do you think the developer will lower the land costs so that the houses can be built cheaper overall?

Or do you think prices will be driven downwards, from bank foreclosures, and houses sold at a loss?

And, what happens to the community if this scenario plays out:
If only existing home prices are lowered, but the developer never lowers their lot prices, how can the community continue to be built, because one could technically be building a house at a loss?

(Kind of like buying a car -- once you drive it of the lot, you've instantly lost money...)
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 02:30 PM
 
22,768 posts, read 30,628,002 times
Reputation: 14737
I shook the Magic 8-Ball.

It said "Yes"



I don't understand, but hope this helps.
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 05:15 PM
 
92 posts, read 263,744 times
Reputation: 28
Lot prices may come down a little bit. But, IMO, the limited availability will support prices. If you look at the south side, many of the lots have already been sold. It remains to be seen whether these are just speculators or home owners in a few years. Most lots, if not all, have build requirements within 2-3 years.

We have been looking at home prices on DI for the last year. Prices have corrected a little; but in most instances, it is cheaper to build new on the island. Developers are lowering prices a little compared to last year. IMO, there are some fair deals on short sales right now. There has always been a premium (it seems) to live on DI and I don't think that will change any time soon.

We decided to build new. Although home prices will probably drop further, my concern is that interest rates will begin to rise in the next 6-9 months.
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 06:04 PM
 
Location: Charleston, SC
159 posts, read 315,683 times
Reputation: 69
Quote:
Originally Posted by RadiatorSprings View Post
CMR,

There seems to be two ways to purchase on Daniel Island. A person can buy a lot, or they can buy a house.

Daniel Island's pricing, on existing homes, is very high, but so is the cost of buying a lot.

Do you think the developer will lower the land costs so that the houses can be built cheaper overall?

Or do you think prices will be driven downwards, from bank foreclosures, and houses sold at a loss?

And, what happens to the community if this scenario plays out:
If only existing home prices are lowered, but the developer never lowers their lot prices, how can the community continue to be built, because one could technically be building a house at a loss?

(Kind of like buying a car -- once you drive it of the lot, you've instantly lost money...)
There is a very high inventory of vacant lots on DI and very few sales each month over the past year so inventory continues to build up. I believe DI requires you to build after certain period of time after closing on the lot.

Eventually the owner/developer will lower the price if there is no demand because inventory grows and places pressure on their balance sheet. The longer the lots sit the harder they are to market because Days on Mkt (DOM) becomes a marketing problem. This is also an example of the market screaming to the developer that their prices are not in line with demand. Sometimes it takes a while before the discounts kick in but nature usually takes its course. One problem with DI homes is most are all going to be Jumbo loans which are tougher to get these days.

Whether the land or homes ends up in foreclosure depends on the financial health of the individual,developer or builder. Prices will be driven down by a combination of factors related to individuals and builders such as mortgage resets, depreciation, job losses, lack of demand, etc. Each property may have a different story and outcome but this recovery will take a while.

If existing homes are lowered and the lot prices stay the same future discounts will depend on demand from the market. Buyers will quickly realize the advantage of buying an existing home vs lot (or vice versa) if there is a price disparity and then the developer will have to make an adjustment on price or allow the lots to sit and not sell.

DI has a ton of space to develop more homes. Obviously the growth has slowed down out there due to economy because it is a wonderful community with many ammenities. The key is nailing down the right price on what the dirt is really worth and going to be worth in 2-3 years. The most speculative real estate play during deflation is buying dirt. As many of you know when you buy a home you are also buying dirt unless it is a condo. If the developer does not agree on your offer then do not buy and wait. If you come in with a proposal that makes sense they may work a deal with you but you have to be careful. Everything is negotiable in real estate.

You also have to understand that DI Real Estate controls a majority of the sales and development on DI. I do not believe they are going bankrupt any time soon so they have a great deal of control on what goes on out there because they have a virtual monopoly on DI. They know that market better than anyone so hopefully they are going to be realistic. However the individual sellers or builders in financial dire straits may not be realistic and drive prices down.

The discounts will really depend on who owns the land or home out there. Builders are not speculating on DI like they used to because many of them got caught with their pants down a few years ago.

I hope that helps. At the end of the day the answer is "it depends."
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 06:29 PM
 
210 posts, read 747,167 times
Reputation: 74
I would agree with you -- Supply and Demand. You said, "But, IMO, the limited availability will support prices".

This is where it can get sketchy. Are prices artificially high - based on a marketing strategy, and not true demand?

Make a phone call to Daniel Island. The developer has tons for sale! It's a big marketing strategy. The developer releases these lots, and then removes them off the market, if they have not sold in a certain period of time.

Look at the maps, look at all the future releases to come over the years. No one knows what price they'll start at.

There are hundreds of lots left.
Reply With Quote Quick reply to this message
 
Old 07-14-2009, 06:38 PM
 
Location: Charleston, SC
159 posts, read 315,683 times
Reputation: 69
Quote:
Originally Posted by RadiatorSprings View Post
I would agree with you -- Supply and Demand. You said, "But, IMO, the limited availability will support prices".

This is where it can get sketchy. Are prices artificially high - based on a marketing strategy, and not true demand?

Make a phone call to Daniel Island. The developer has tons for sale! It's a big marketing strategy. The developer releases these lots, and then removes them off the market, if they have not sold in a certain period of time.

Look at the maps, look at all the future releases to come over the years. No one knows what price they'll start at.

There are hundreds of lots left.
180+ lots for sale with only 1 or 2 selling per month is NOT limited availability. Where are you getting this "limited availability" phrase from?
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:




Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > U.S. Forums > South Carolina > Charleston area
Similar Threads
View detailed profiles of:

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top