These rankings are very significant, considering that they are compiled from surveys made to real tourists who stay at these resorts (i.e. from the users’ perspective, not some industry association’s).

Interest rates provide the key ingredient to the mortgage recipe. They determine the cost of your borrowing, how much you can borrow, and how much of your time will be consumed repaying what you borrow. Their importance cannot be overestimated and an explanation of such would fill volumes. The vital nature of interest rates in our economy begs the question: where are they heading?

We believe that interest rates will rise this year. How much is anyone’s guess but we would not be surprised if the rate on a 30-year mortgage went as high as 6.50%. First, at the end of this month, The Federal Reserve Bank will cease purchasing mortgage-backed securities. By the time the end of the first quarter rolls around, the Fed will have purchased 1.25 trillion dollars in mortgage-backed securities. This has lent liquidity to the mortgage market and has lessened the pain felt by the real estate industry. Investors will have to fill the void left by the Fed beginning in April.

We believe that to attract these investors investment banks will need to offer a higher return for what could surely be a risky investment. Second, the economy as a whole will begin to heat-up. Legislative spending on the federal level will be somewhat stifled this year because of the political gridlock caused by the upcoming November elections. Less government is historically a good thing when it comes to growing a sound economy.

Also, Americans are only going to put up with a recession for only so long before our “can do” attitude finds a way out of our shared misery. A growing economy always brings the pressure of inflation which, in turn, raises interest rates. The reasoning goes like this: the Fed will not want a sharp rise in the cost of goods and services (which inflation brings). Raising interest rates tends to lessen borrowing because it becomes more expensive to borrow.

Third, where can interest rates go? December, 2009 saw the lowest mortgage interest rates in history. Housing demand, especially in the low country, is beginning to heat-up and, as we know, an increase in demand tends to make interest rates rise. When one stops to consider that our current inflation rate is 2.63% and that 15-year mortgages are priced at around 4.375%, end investors are making an astounding 1.745% for their risk. This cannot and will not continue.

What does this all mean?

It means that if you have not acted to refinance your home or purchase the home you have been dreaming about you need to act now. If you feel the rates are not low enough and could stand to lower even further then you stand a great chance of being left out in the rain. Aside from taking action, rising interest rates in this current economy is a good thing: maybe the American economy is going to rise off the canvas, dust itself off, and begin powering/leading the globe once again.

Robert Weaver is a mortgage loan officer with Brayden Capital Home Loans. He can be reached at rweaver@braydencapital.com

If a homeowner has a substantial amount of equity and wants to sell a home quickly, a PUBLIC AUCTION is a viable way of marketing a property, create URGENCY and obtain the MAXIMUM price that the market will bear. Auctioned properties are normally sold “no-contingency, as-is, where-is”, which means that sellers usually don’t need to deal with contracts that fall through over and over because of buyer financing, nor they have to perform any repairs.

The only catch is that the success of an auction depends on competitive bidding from different interested bidders. If the auction fails to attract a significant number of qualified, interested buyers it is probably going to fail. 

So – how do you attract a “significant number” of qualified and interested bidders? The answer, in this “soft” real estate market is simple. The ONLY auctions that WORK are:

• ABSOLUTE AUCTIONS – where the property is guaranteed to be sold the day of the auction to the HIGHEST BIDDER – REGARDLESS OF THE AMOUNT OF THE BID. This potential “bargain opportunity” normally attracts many bargain-hunters banking on paying cents on the dollar, creates a competitive bidding environment and normally pushes the price up (sometimes even beyond “perceived market” price). The risk to the seller is controlled by monitoring the amount of registered, qualified buyers BEFORE the auction. If this number is not conducive to a competitive bidding situation, the auction can be PULLED OFF at the last minute to avoid disaster. Absolute auctions cannot be performed if the seller has a mortgage on the property, unless the LIEN HOLDER pre-approves it.
• DISCLOSED RESERVE (i.e. “minimum acceptable price”) AUCTIONS – only work well when the disclosed reserve is a VERY ATTRACTIVE number (i.e. “half-price”). Again, this attracts bargain-hunters and stimulates competitive bidding which normally pushes the price up to a “market” price. For these auctions to work, the seller must either own the property outright, or owe an amount lower than the disclosed reserve. If the reserve amount is not reached at bidding, the property is not sold. Once the reserve is reached, it becomes ABSOLUTE – it will be sold to the highest bidder.

Most auctions normally work with pre-qualified, pre-registered bidders. The winning bidder normally needs to pay a 10% deposit the day of the auction, and the balance in 30 days.

The good thing about auctions is that it only takes 4-6 weeks to find out the outcome. If the property is not sold at auction, the seller always has the option of offering it for sale as a “traditional” MLS listing, without becoming “stale” by virtue of waiting for months for an offer…

LOWCOUNTRY HOME AUCTIONS, LLC is a company that provides auction marketing services to home sellers, agents and institutions needing to sell homes in South Carolina. If you have any questions or wish to receive a proposal to sell your SC property, please send us an email with your contact information.

Summary

There is light at the end of the tunnel! Inventory in Mt Pleasant continues a downward trend (albeit a slow reduction) and monthly sales are back above 100 a month. Distressed homes (short sales and lender-owned) homes are still appearing in most neighborhoods and have placed additional stress on appraisers.

Inventory and Absorption                       

We can still observe traditional seasonality in our home inventory in Mt. Pleasant. Comparing 2009 with the two previous years, we can definitely see a trend toward inventory reduction: Each peak has been lower than the previous one, and each low has also been lower. From January until May sales were very low (all below 100, January was the slowest month with 56 sales).

However, since July 2009 all months have registered sales above the 100 mark.
Some specific neighborhoods like Belle Hall Plantation have seen faster reductions in inventory. Belle Hall went from a high of 68 active listings in August of 2007, to 37 listings in December of 2009.

As of December 31^st total listing inventory was 1385 listings, the lowest level since March of 2006, but at the rate that we are selling, this still represents more than 14 months’ inventory. If this index drops to below 6 months, (i.e. the “transition point” between a “buyer’s market” and a “seller’s market”) we may start seeing upward pressure on home prices.

New Homes Supply

There are still very few “spec-built” homes available in the area, although some builders have started to offer new construction homes at reduced prices which are competing very effectively with existing homes.

Some smaller projects like Pinckney Place, Phillips Park, Watermark, Carol Oaks and the first builder in Carolina Park are seeing increased activity, especially in the lower ($200-300K) price ranges. Builders in I’On are offering cottages from the high $400K’s.

Builders have enjoyed cost reductions in both the price of land, and in building costs (materials AND labor), as their demand slowed down and are now building homes in prices and sizes that are more accessible to buyers.

Time On Market

The Days on Market Index (DOM) went from a low of 22 days in December of 2005, to 157 days in December (a little over 5 months). This is long, but still not too bad compared with Sullivans Island and Isle of Palms, which have an average time on the market of 247 days.

What’s Ahead?

I believe that the Mt Pleasant market (at least for single-family, detached homes) will be one of the first areas in Charleston to “pull out” of the decline. Interest rates are still at historical lows (although there is some talk of rates going up toward the middle of the year). Price decreases are still happening, but the decline has slowed down considerably.

The chart above shows the relationship between the average inventory and the median price. We still have a long way for prices to increase, but the median price line is close to intersecting with the 4% appreciation line, which is the average long-term historical appreciation for real estate.

Continued absorption depends largely on consumer confidence and the job market. The arrival of Boeing as a major employer in the region is great news for residential areas like Mt Pleasant, within short driving distance to the airport, but offering great quality schools and lifestyles. There has already been a palpable effect of this new employer on the rental market, and the rental inventory is currently very low. My crystal ball tells me that Mt. Pleasant will start “recovering” in earnest towards the end of the summer!

Read more entries like this one at:

BuyHomesInCharleston.com

Posted using ShareThis

See more Charleston and Mt. Pleasant videos at BuyHomesInCharleston.com

Pineapple Fountain at Charleston's Waterfront Park

Here are Lonely Planet’s top choices:

Countries: El Salvador, Germany, Greece, Malaysia, Morocco, Nepal, New Zealand, Portugal, Suriname, United States.

Regions: Alsace, France; Bali, Indonesia; Fernando de Noronha, Brazil; Goa, India; Koh Kong Conservation Corridor, Cambodia; Lake Baikal, Russia; Oaxaca, Mexico; Southern Africa; The Lake District, England; Southwest Western Australia.

Cities: Abu Dhabi, United Arab Emirates; Charleston, United States; Cork, Ireland; Cuenca, Ecuador; Istanbul, Turkey; Kyoto, Japan; Lecce, Italy; Sarajevo, Bosnia; Singapore; Vancouver, Canada.

Read more articles like this one on my blog: BuyHomesInCharleston.com

Charleston County has commissioned a new traffic study in anticipation of the opening of the new Boeing 787 Dreamliner assembly plant in North Charleston in 2011. The county and the City of North Charleston want to get prepared in anticipation of the new employment hub that will be created near the airport. See this news video.

Home Under Construction in Charleston, SC

“Foreclosures up 17% in October in Charleston Region“

The next 18 months we will probably experience a rise in lender-owned homes hitting the market at aggressive prices due to all the distressed homes that have been and will be foreclosed upon.

For buyers who are waiting for the perfect moment to buy, I believe this will signal the bottom if the market: The combination of aggressive list prices, low mortgage  interest rates and the Federal Tax Credit ($8,000 for first-time home buyers, $6,500 for buyers who have owned a home for the past 5 years) is a fantastic “Perfect Storm” to buy.

To obtain a list of foreclosures, lender-owned properties or short sales, please email me or leave me a voice mail at (843) 416-1434.

Alan Donald, MBA, REALTOR, e-PRO
BuyHomesInCharleston.com
Keller Williams Realty

Cruciate Ligament Surgery Patient courtesy of Flickr

Local medical tech startup gets funding! I can see Charleston drawing on its strong industry clusters: Medical research (MUSC), military (CAFB, SPAWAR, NWS), logistics (PORT), tourism and now also aeronautics (BOEING)!

“Mount Pleasant-based Ion Surgical Technologies has received $200,000 in its first investment of startup funds from SC Launch.

Ion Surgical, which was started in October, has developed products that aid in the healing from injuries the rotator cuff and the anterior cruciate ligament. The two main products are the PassTech Rotator Cuff Repair Kit and the PassTech ACL Fixation Kit…”  Read the full article, as published in the Charleston Regional Business Journal.