Cameron Keegan - Greenville SC Realtor

There is no doubt in my mind, that everyone reading this has heard some negative news about the real estate market over the past 18 months or so. While it is true that the market (on a national level) has seen better days, it is also true that some markets are still doing better than others.

First of all, there is no national real estate market. That's just as obvious as the fact that there is no national weather forecast. You've probably heard a similar analogy before, but it's true. There is also no denying that the issues facing real estate in some areas, have had an impact on the market in the Upstate.

The residential real estate market has changed on many levels in the past year or so, and the antithesis of these changes resulted in the boom we saw in many markets 3 to 5, and even 7 years ago. For the most part, those markets which didn't see this "boom", are the ones doing better right now compared to those that did.

Greenville, SC and the surrounding Upstate areas did not see the boom that many markets experienced, and therefore did not see as drastic of a decline. The changes I was referring to above include home prices, financing, average days on market/absorption rate, and the number of homes sold.

Existing Home Prices

According to the National Association of Realtors, the United States saw its recent peak in median sale price on or around 3rd quarter 2006, when the median sale price of an existing single-family home reached a seasonally adjusted price of $221,900. The national median price fell to $196,100 (1Q08), but has since risen to $200,500 as of 3rd quarter 2008.

The trends in home prices are very different for the Greater Greenville, SC area, according to the Greenville SC MLS. In fact, the median sale price of an existing home has stayed stable, and has even appreciated in most quarters. In November 2008, the median sale price in Greater Greenville, SC was $139,000. This is compared to $140,000 in November 2007, $132,500 in November 2006, $135,250 in 2005, and $126,000 in November 2004.

Our affordability has also helped avoid a major decline, and on November 12th, 2008, Forbes ranked Greenville County #5 in their "Affordable Place to Weather the Downturn" article. This was based on an affordability index (150.23), median property tax ($984), job growth (+.9%), and per capita income ($23,926).

Financing

Obviously the landscape of the mortgage industry has also changed. The sub-prime lending market is gone, so those who had been able to find financing in the past, may have more difficulty now. BUT, there are plenty of financing options out there for people with good, and even average credit.

There is this huge misconception right now, that although interest rates are at great levels, you have to have perfect credit and a huge down payment in order to qualify.

Currently, the national average for a conforming 30 year fixed rate mortgage is 5.875% according to HSH Associated Financial Publishers (http://www.hsh.com). Local rates for conforming 30 year fixed mortgages average around 5.5%, based on rates from several local mortgage professionals.

The Greater Greenville area is still considered a low-risk market by most, if not all lending institutions. On October 1st, 2008, the housing price risk index from The PMI Group, Inc showed that Greenville, South Carolina has a "less than 1% risk of decline in average home price over the next two years."

The fact is that you can still find lending option to fit virtually every financial scenario, with the exception of those buyers who relied on the sub-prime market. You can find programs with requirements for 3% down, 5% down, and the USDA Rural Development program continues to have 100% options available for properties in eligible areas. These eligible areas still include some areas surrounding Five Forks (Woodruff Rd/Bennetts Bridge Rd), even areas surrounding Locust Hill Rd/Wade Hampton Blvd in Taylors, and more.

Average Days on Market/Absorption Rate

First of all, the average days on market and absorption rate are two different things, but are commonly confused as the same.

The absorption rate is a measure of the length of time it would take to sell all existing inventory, based on the number of sales in a specific timeframe. While the absorption rate across the US has risen to approximately 11.5 months, the absorption rate in the Upstate still averages approximately 7.99 months for existing single-family homes. Both figures indicate a buyer's market, but the Upstate remains far healthier than the national average.

Average days on market is measured from the first day of a listing agreement, to the day a property goes under contract. In the Greater Greenville area, it was approximately 87 days in November 2008. This is compared to 85 days in November 2007, 75 days in November 2006, 92 days in November 2005, and 99 days in November 2004.

Number of Homes Sold

The number of homes which have sold is an area where virtually every market has been affected. This is due to many factors including the lack of sub-prime lending programs, the inability for people to sell their homes in declining markets and move (within the same market or to another market), the sharp increase of home sale activity in past years, and buyer perception as a result of negative media attention.

According to the National Association of Realtors, in 2005, approximately 7,076,000 homes sold in the United States. This number fell to its lowest point during 2nd quarter 2008 when the seasonally adjusted annual rate fell to 4,910,000. In 3rd quarter 2008, this number rose to a seasonally adjusted annual rate of 5,037,000 homes.

In the Greater Greenville area, there have been 5,028 existing single-family homes sold year to date (1/1/2008-11/30/2008). This compares to 6,235 during the same time period in 2007, 6,576 in 2006, 5,925 in 2005, and 4,958 in 2004.

The Future

It is my opinion that the markets which saw little or no decline during this slowdown, will rebound quicker than those which were heavily impacted by falling prices and increases in absorption rate. I believe this to be true because as those markets begin to pick up in sales, more buyers will revisit their original intent to relocate. When those markets rebound, the media will shift their focus to something else, which will bring more local buyers off the fence in their respective markets.

When this rebound will occur is anyone's guess, but many of the nation's leading financial analysts are predicting that residential real estate will begin to pickup in the 2nd quarter of 2009.

I have already started to see an increase in inquiries, reminiscent of what I remember in 2006. During that time, many of the buyers in the Upstate were coming from Florida, New England, and other parts of the country. I constantly look at statistics for my website, and keep a close eye on Realtor.com traffic reports. As for Realtor.com, the Greenville-Spartanburg-Anderson MSA saw a 15.1% increase in traffic in September 2008, compared to September 2007.

Typically the busiest time for my website is during the summer months, but during 2007 and until recently, I noticed a decrease in traffic from Florida, New England, etc. As you will see in the chart below, that traffic has increased to levels comparable to what I remember in late-2006, which I believe is a good sign.

My website traffic during the first two weeks of December (232 unique visitors) has increased to levels which surpass the first two weeks in August (146 unique visitors). This actually defies everything I know about traditional times when people inquire about real estate. Not only have local searches increased, but traffic from Florida has increased by 37.50%, and the number of pages those buyers are visiting has increased by 72%. Traffic from several New England states has doubled. Even inquiries from Michigan increased by 350%, and visitors from North Carolina increased by an amazing 450%!

A final look into my website visitors from November 14th - December 14th, which I think accurately displays the continued interest in the Greenville, SC market:

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This ended up being a much more lengthy report than I originally anticipated, but as long as one person finds this information useful, it was worth it.

Please let me know if you have any questions whatsoever, and have a great day.

Cameron J. Keegan - Greenville SC Realtor
Prudential C. Dan Joyner Realtors
Mobile: 864.238.7109
Greenville SC Homes for Sale

Once again, the OFHEO (now the FHFA) released their House Price Index, which showed the Greenville-Mauldin-Easley MSA as having the 9th highest appreciation rate in the United States when comparing 3Q08 to 3Q07.

According to this index, the appreciation rate in our Metropolitan Statiscal Area has amounted to the following:

Quarterly (2Q08 to 3Q08): -.61%
Yearly (3Q07 to 3Q08): +4.55%
5 year (3Q03 to 3Q08): +22.63%

Just like to share those tidbits of information with everyone, since a lot of what you hear in the media has little or no bearing on our local market.

Source: http://www.ofheo.gov/media/PDF/3q08hpi.pdf

View more Greenville SC Real Estate Statistics!

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Cameron J. Keegan - Realtor, ASR, ABR
Prudential C. Dan Joyner Realtors
Mobile: 864.238.7109
Office: 864.678.5373
ckeegan@cdanjoyner.com

In a Forbes article yesterday, they ranked the most afforable areas in the US to weather the economic downturn. They based their analysis on affordability, property taxes, and job growth.

Greenville County, SC ranked #5! They even used Main Street as their headline photo.

Just thought I would share that.

Source: http://www.forbes.com/2008/11/12/cheap-cities-affordable-forbeslife-cx_hc_1112realestate.html

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Cameron J. Keegan - Realtor
Prudential C. Dan Joyner Realtors
Mobile: 864.238.7109
Greenville SC Real Estate

In a recent ranking of "2008 Best Cities for Relocating Singles", Greenville actually ranked 21st, of the 100 metro areas in the rankings.

This ranking was based on a multitude of criteria ranging from population demographics to an adventure index.

Yet another positive story relating to the Greenville area, and why it continues to be a great place to consider when thinking about your next move.

See full article below, and click here for more Greenville SC Real Estate.

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WASHINGTON, Oct 30, 2008 (BUSINESS WIRE) -- Relocation industry group Worldwide ERC(R) and Primacy Relocation today announced at ERC's Global Workforce Symposium that Boston/Quincy, MA; Nassau/Suffolk, NY; New Haven, CT; New York/White Plains/Wayne, NY/NJ; and Edison, NJ are 2008's Best Cities for Relocating Singles among U.S. metropolitan areas.

In this fifth and final annual survey, the two organizations once again partnered with Bert Sperling's BestPlaces to identify the cities with the most to offer relocating singles. Using statistical profiles of the largest 100 U.S. metro areas, the survey focused on the criteria most relevant to singles, with the rankings reflecting the ease of transition during a relocation.

Unlike other "best" surveys, the ERC/Primacy Best Cities for Relocating Singles survey measures the issues impacting a newcomer's experience in the weeks and months immediately following a transfer. This year's survey placed an increased emphasis on those economic factors most affecting singles, including an area's unemployment rate, percentage of recent job growth and availability of affordable rental housing. New data was also incorporated this year, measuring an area's arts and recreation opportunities and the overall population growth.

"Relocating to a city can be both exciting and overwhelming for an individual," said Michelle Vallejo, SCRP, GMS, Primacy's President, The Americas. "This survey identifies those factors that help ease the transition for singles, while helping HR professionals better predict the success rates of their employee transfers."

"It's well known that the success of a relocation is strongly reliant on the transferee's ability to assimilate into the new community and recreate his or her support, social, medical and lifestyle networks," said Cris Collie, CAE, Chief Executive Officer of Worldwide ERC. "Our newest 'Best Cities for Relocating Singles' survey provides substantive information for companies whose ranks of renters, a group largely comprised of singles, have been on the rise."

Statistics Used in Ranking the Best Cities for RelocatingSingles:
Population Criteria:
Local single population aged 25-34
Male-female ratios
Diversity and density

GrowthEconomic Criteria:
Cost of living index, rental rates and availability of rentalproperty
Job growth vs. unemployment rates
Higher education costs, including in-state and out-of-state tuitionrequirements

Quality-of-Life Criteria:
Adventure index
Prevalence of restaurants, bars, health clubs, sporting events andconcerts
Percentage of population utilizing online dating and subscribing to magazines geared towards singles
Annual rainfall, snowfall and high/low temperatures
Property and violent crime rates

Worldwide ERC is the membership association of choice for corporate and government relocation managers, real estate companies, goods movers, and a range of service firms and individuals from industries relocation-related workforce issues. Global workforce mobility trends information are at their site. ( http://www.erc.org/)

Sperling's BestPlaces puts facts about cities and living in the hands of the public, so they can make better decisions about best places to live, work, retire, play, or relocate.

Primacy Relocation is one of the top third-party employee relocation providers in the world, and is the largest to focus all technology and resources solely on relocation and global assignment (expatriate) management. Primacy administers programs for employers throughout the Americas, EMEA and Asia regions. Core services include home sales, destination services, household goods move management, and overall program administration. In addition to its Memphis headquarters, Primacy has offices in Chicago, Dallas, Houston, Los Angeles, Minneapolis, New York, Omaha, Sacramento and Washington D.C. (Government Services), as well as Amsterdam, Basel, Geneva, Hong Kong, London, Montreal, Munich, Paris, Shanghai, Singapore and Zurich. Primacy is online, in nine languages, at primacy.com.

Source: Primacy Relocation and Worldwide ERC(R) Rank 2008 Best Cities for Relocating Singles(TM) - MarketWatch

With the dismal reports on the national news (and sometimes local), I thought I would shed some light on the state of our local market.

Did you know that the average sale price of an existing home is still rising in the Greater Greenville area? Surprising, I know, since everyone in the media makes it sound like the "real estate crisis" is national. In fact, Greenville had the 9th highest appreciation rate in the most recent price index by the National Association of Realtors. Better yet, The PMI Group Inc. (an organization responsible for identifying risk for lenders) released a report on October 1st, 2008 showing that the Greater Greenville area has "a less than 1% risk of decline in average sale price over the next 2 years."

Something else you might hear about all the time is the foreclosure crisis. Here's another reality that you may not hear on the news too often. According to RealtyTrac (the same organization where the news gets their info), Greenville has a rate of foreclosure 65% below the national average. Actually, in the list of the top 100 markets by population, Greenville ranked 88th for number of households in some stage of foreclosure.

Another term you may hear from time to time is "absorption rate" or "inventory". This has always been a reliable gauge of where a market is leaning (buyers market, sellers market, or neutral). The absorption rate is calculated by counting all of the properties currently on the market, and figuring out how long that inventory would take to sell based on the number of sales in the past. While the national average is approximately 11.5 months (indicating a strong buyer's market), the absorption rate in Greater Greenville is approximately 6.5 months (indicating a neutral market leaning toward the buyer).

One story currently all over the news, is that lenders have limited funds to give potential buyers. It is true that someone with a 570 credit score may have difficulty finding 100% financing nowadays. In markets where prices are on a downward slope, of course lenders have tighter funds, but in lower risk markets such as Greenville, the funds are still readily available.

I sincerely hope that this information helps. If you are looking to buy, interest rates are low, and prices are still rising. I recently realized that if I were to ask my financial advisor to "find me an investment that has averaged a 3.14% yearly gain over the past 5 years, with the ability to write the interest off my taxable income, not pay any taxes on gains up to $250,000 after 2 years, and has a less than 1% risk of decline for the next two years", he would laugh at me.

That's the reality of the Greenville market.

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Cameron Keegan is a Greenville SC Realtor with more than 5 years experience in helping buyers and sellers with their Greenville SC Real Estate needs.