Mount Pleasant Market: Running Out of Steam?
Author: Alan Donald. August 7, 2015
Note: This article refers to general area information, but real estate sometimes is "hyper-local", which means that certain neighborhoods may behave differently that their areas. Click Here if you are interested in buying a home in the Charleston Area and want information about a particular neighborhood.
We have always maintained that in real estate, the Mount Pleasant market is to the rest of the Charleston like the California market is to the US in terms of technology trends: Everything happens first in Mount Pleasant, and then it "filters through" to the other areas.
Case in point: The Mount Pleasant real estate market virtually "stopped" in February of 2006, while the rest of the MLS kept "booming" until mid-2007. Conversely, the Mount Pleasant market has been improving now for close to three years, and it's been in a "seller's market" (less than 5 months' inventory) since 2013, while the Charleston Area as a whole just hit the 5-month inventory point in February this year.
Interestingly, because the Mount Pleasant market has been strong for so long, sellers' expectations of price increases appear to have exceeded buyers' expectations and what buyers are prepared to pay: We are experiencing some buyer "pushback" especially in the last 2-3 months: Although inventory is still decreasing, we are seeing price reductions more often than we had seen in the last year.
Today's "Hot Sheet" snapshot from the MLS tells a recurring story: Inventory is going down (therefore prices should be increasing..!), yet sellers who priced their homes too high are being forced to lower their prices to get some traction. The graphs show that both inventory AND the median price per square foot are now decreasing.
This could be a seasonal abnormality, or a starting trend for a longer term market correction. We just don't know (yet). The next 3-6 months will tell the story. We still believe that the long term market fundamentals for Mount Pleasant and the Charleston, SC are are very strong, as job creation and retiring baby boomers are driving demand. But in the shorter term, the market may experience corrections and changes in momentum.
Why is this important to know? If you are thinking about selling your home, make sure to pick the right timing to do so, and that you price your home strategically so it does not stay long on the market. If you are thinking of buying a home, this may be a good time to get that extra discount that perhaps was not possible just 4-6 months ago...
National Association of Realtors (NAR) research shows that on average, the longer a home stays on the market, the lower percentage of the last list price it will receive. If you think about it, this makes sense: If you are a buyer and you like a home that has been on the market for 4 months, while all other comparable homes are going under contract in 3 weeks, you may think one of two things: a) Maybe there's something wrong with it; or b) They must be desperate. In either of those two scenarios, you would want to offer a lower price!
In order to maximize the NET RETURN from the sale of their home, being able to get the home under contract in the first 6 weeks on the market is extremely important. This is why sellers who choose to sell by owner or with a limited service Realtor may be shooting themselves in the foot and may be leaving money on the table.
Strategic market pricing and professional marketing are two of the key added value components for sellers that a full-service Realtor like The Alan Donald Real Estate Team can offer.
Our state-of-the-art 39-Point Marketing Plan allowed us to show telling statistics for 2014: We sold our listings on average for 97.21% of Original List Price, compared to the average of 91.93% for the MLS - this means our clients put 5.28% more in their pockets! In addition we sold our listings in an average of 35 days, compared to 82 days average for the MLS - that's 47 days quicker!
For buyers, our Buyer Advantage Program will give you a leg up the competition, especially in the "hot" submarkets of the Charleston area.
Call/Text 843-900-0155 today to sell your home with us, get a free, no-obligation home value estimate, or get advice on how to maximize the equity in your home.