Greetings from the Grand Strand,
Well, since the storms of September finally ended,
October along the Grand Strand has been gorgeous
- clear dry days, highs in the 70s to mid 80s.
It's also been the busiest October I can remember.
It's been difficult to show a lot of resort properties because they have been almost 100% rented.
Of course the shoulder seasons have been getting busier for years now and I'm sure this is a trend which will continue into the future.
Sales activity has also been very strong. Six sales for me so far in October with a week to go - all resort condos. I
t's normal for there to be an increase in activity during the fall after a lull in July and August.
This year, it just seems stronger than normal.
There is, however,
one component of our local real estate market which has been exceptionally weak - new listings.
These monthly newsletters typically focus on all sorts of great reasons to buy and own in our wonderful area.
However, f
or some owners, it's time to sell. This is an ideal time of year to list a resort property for lots of reasons but very few owners are taking advantage.
The following chart shows new oceanfront listings by month over the past four years.
As you can see, almost twice as many new listings are entered in MLS during the spring as in the fall and winter. Ironically, this is almost exactly the same pattern we see for condo sales. Logically, you would think that the time to buy would be in the spring and the time to sell would be in the fall and winter. So why do so few people list in the fall and why is it a good idea to list in the fall?
Let's take a closer look at all the factors.
I advise each buyer and seller that the reason to buy or sell is basically the same - to better the lives of the buyer/seller and his or her family. The benefits can be personal or financial.
There are lots of good reasons for an owner to sell a resort property such as:
Not visiting a second home as much
(for any number of reasons).
Upgrading to a bigger and better property.
Consolidating, simplifying one's life by trimming down a portfolio of properties.
Selling to reinvest in a different investment property (1031 exchange maybe).
I
f there are opportunities available with better returns that you find attractive, then your money is in the wrong place.
My experience has been that if someone starts thinking about selling, then some subconscious instinct in the back of his mind has already prompted him to do so.
So if you have a good reason to sell, when should you get started? Except for rare circumstances, the best time to list is - now! Frankly, I would advise this for any time of the year. I think the idea of trying to use seasonal strategy to buy and sell is overblown.
Sometimes we see marginally higher prices in the spring but a seller has to wait through the off-season and carry the expenses for six months or so to get there so it's generally a wash. As for hoping for huge appreciation, although prices are edging up, we have not seen raging inflation in this market since 2005 so waiting a year or two to hope for a much higher price is probably not a good strategy if there is a benefit to selling now.
Regardless of the seasonality, I think this exact moment in time is a good time to list in many resort properties.
The biggest short-term variations I see in selling prices occur, not because of the season, but because of the available inventory
. If there are lots of listings, even in a desirable property, the seller has to price against the competition and often has little negotiating power if an offer comes in. On the other hand, the very best time to list is when there are few listings to compete with or when the other listings are priced higher than recent sales would indicate as market value (That's a nice way of saying they are overpriced).
As previously mentioned,
there have been relatively few new resort condo listings lately.
T
his goes way beyond normal seasonality - inventory levels are the lowest I have seen them in over a decade. Combine this with the strong sales activity (lots of buyers searching for properties) and you've got a super time to sell.
So why do so few resort condo owners list their properties in the fall?
First of all, the attentions of most owners are elsewhere during this time.
Although lots of people visit the beach in the fall, the peak summer season has passed, football season has started, school has started back, and the holidays are around the corner. Out of sight - out of mind.
The big spike in listings in the spring occurs because owners are past the holidays, they get cabin fever and start thinking about summer pastimes, it's a new year and everybody rethinks their priorities and goals, and tax season is approaching. Presto - the result is lots of listings. And lots of other new listings for these to compete with. They really should have listed in the fall!
Second, selling a resort property, just like buying a resort property, is a discretionary decision.
It's different than the sale of a primary residence, which is typically prompted by some significant life change - new job, new baby, desire to downsize or upgrade, change in financial situation,...
The inclination, unfortunately, is to just kick the can on down the road and think about it some other day. Or year. Or decade. It's amazing how long people keep properties after their original reasons for purchasing have gone away.
The third reason owners don't list in the fall is because, as busy and preoccupied as they are, they don't want to take on anything which will involve a lot of time or effort. Most people who have sold their houses, or even rental properties, view the selling process as a time-consuming, energy-draining, generally unpleasant experience.
They have to work around showings, keep the house clean all the time, arrange appointments with tenants if it's a rental property, etc.
By contrast, listing a resort property for sale generally requires less than an hour of the owner's time and it can be handled from your living room, your office or just about anywhere else that is convenient for you.
We generally send the listing documents for electronic signatures so you don't even have to print them out.
We do all the rest - order professional pictures, arrange showings, gather information on the HOA and rental numbers if applicable - "soup-to-nuts"!
Offer negotiations and the closing process are equally quick and painless.
The offer paperwork can generally be handled electronically.
You don't even have to make the trip here for the closing (unless you want to).
The vast majority of our sellers simply close by mail. The local real estate attorneys we work with are uber-efficient closing machines. In short, from listing to closing, we make the selling process easy for you.
Do you have a reason to sell? If you have started thinking about it, you probably do.
If you would like to explore the possibility of selling (or if you just want an estimated market value), please take a few minutes to call or email me and we can go over current market conditions, possible strategies and an approximate price range. If you decide to list, we'll put the process in motion. That's usually all you will need to do.
That's all for now. All the usual reports and my Best Buy lists are included.
See you at the beach!
This monthly newsletter feature shares press releases that caught my eye in the previous month.
