Posted By Gene Carter @ Oct 18th 2024 3:24pm In: Monthly Real Estate News


Grand Strand Real Estate News


September 2024


Volume 2024 Issue 9


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Dear Gene Carter Team,



Summary


Although I won’t make any predictions, in this month’s newsletter I will go over some of the events and trends that could directly or indirectly affect our local oceanfront and resort condo market.


Also, real estate tax bills have now been sent out. Here’s a link to our Closed Sales Histories, which shows details for all closed sales since 2009 for about 200 Resorts.


BeachProTeam.com/nl-ClosedSales



Oceanfront and Resort Condo Market Conditions


Overview: After a busy September, my sales activity has slowed significantly in the first two weeks of October, possibly because of the upcoming presidential election. The overall market conditions have not changed. Listings for large condos, particularly ones in good condition with lots of upgrades, are relatively scarce and the prices are holding up or only dropping slightly. For the smaller condos in most buildings, it’s a buyer's market. A few buildings with exceptional rentals are bucking this trend.


Sellers: My advice continues to be - if you want to cash out on the big price increases in 2021 in 2022, now is the time to do it. I don’t see any more upside for a long time and there is a real risk prices could decline. There is even more uncertainty now because of the recent storms and the upcoming election. It’s also a good time to sell because we are at the end of the peak rental season. Please contact me if you want to discuss a property you own.


Buyers: You have far more choices than have been available in the past several years and there are some motivated sellers out there. Contact Teressa or Kevin to help you find the perfect property.


Active Oceanfront Condo Listings


The number of active oceanfront condo listings increased slightly after being flat for a couple of months. As of October 15, there were 1006 active listings, compared with 995 last month. The number of active condo listings off the beach also increased, to 1778 (up from 1749 last month). (See chart in newsletter)



Oceanfront Condo Monthly Metrics


In September’s chart for month-to-month metrics for oceanfront condos (in newsletter). Everything was down (average sales price, new listings, pending sales, closed sales, closed dollar volume) except the number of active listings, which was up 1.1%. Most notably, the pending sales were down 15.7% from the previous month. Closed sales (only 99 on the entire Grand Strand) were down 3.8% from the previous month and 25 %from September 2023. 


New Homes and Resales


In September, there were more new construction closed sales than closed resales, 495 vs. 419. Once again, there were far more new resale listings than new construction listings, 647 vs. 447. The median sales price for resales was $367,500 vs. $349,325 for new construction. (See chart in newsletter).



What Factors Will Influence Our Oceanfront/Resort Condo Market?


What will happen in the coming months and years? Here are some events and other factors that will shape our market.


Rental Incomes


Rental income is one of the main factors determining the value of a vacation rental property. The incomes are either flat or down slightly for most resorts this year. We checked on the year-to-date incomes through August (which would include the entire summer) for nine of my listings. All of these were oceanfront condotels. All were handled by rental management companies (7 with onsite rental companies and two with offsite companies). On average, the incomes were down 10% from incomes in 2023. The incomes in many resorts are now almost back to where they were during the long flat price period which went on for about a decade prior to 2021.


This year-over-year decline is a trend I have observed since 2021. It definitely appears now that the huge 2021 income increase was an anomaly rather than the new norm. Interestingly, many owners handling their own rentals through Airbnb and VRBO have not seen rental income declines over the past few years. I’ll cover this subject in more detail in a later newsletter.


Interest Rates


Hopefully, these will finally come down over the next year or so. Lower interest rates are good for real estate in general because they make it less expensive to borrow money to buy. Low mortgage interest rates are good for investment real estate indirectly as well. It generally means that rates of return for very safe investments are also low, making real estate, which is inherently riskier, more attractive.


Insurance


Most condominium complexes had slightly lower insurance premiums this year. I don’t believe it’s because the insurers lowered their rates. It’s mainly because the property management companies representing the resorts shopped around and got creative, often shaving off layers of coverage they didn’t think were essential. 


Unfortunately, two major hurricanes just hit the US, causing massive damage in Florida, Georgia, North Carolina, and Tennessee. There are also monstrous wildfires burning around the country. Climate change is not a hoax. It’s costing US lives and hundreds of billions of dollars per year in losses and higher insurance costs. There is no end in sight for this so insurance rates will almost certainly continue to increase for the indefinite future. For everyone.


Areas most at risk, of course, have higher insurance rates. Currently, Florida has the highest in the country and their rates are getting ready to go even higher. South Carolina’s rates are among the highest as well, particularly in the coastal areas. 


Election


The two candidates’ plans for governing are radically different. The decisions made by the next administration will have major impacts on real estate in general for the next four years and probably for many years after that.


Speculation: Florida Exodus?

Florida's condominium owners are facing significant increases to their already sky-high insurance costs. Also, upcoming laws (going into effect by the end of this year) requiring regular inspections and funding reserves for structural improvements are adding further financial pressures on condominium associations. 


Will all this be enough to drive Florida condominium owners out of the state? And if so, will some of them repurchase in Myrtle Beach? I feel sure we will see at least a few but I don’t know if it will be enough to influence our market. This is pure speculation, but it’s one of the factors that could affect our market if a large number of owners end up buying here.


That’s all for now. Check out all our usual Grand Strand Market Reports, Sales and Listing Updates, my Best Buys, and new Beach Pro Team reviews.


Please Contact The Beach Pro Team If:


You are thinking of buying or selling an oceanfront or resort condo in our area

                                                                  Or

You are considering moving to our area or know someone else who is

                                                                   Or

You are an agent who has clients thinking of moving here or buying or selling in our area

                                                                   Or

You currently own a condo in our area and want a permanent home here.

Greetings from The Grand Strand!


We are now entering HalloThanksMasDay season. It’s just one holiday after another from now until the end of the year. On top of all that, it’s a presidential election year. There’s a lot going on in the next few months! In this month’s newsletter I will go over some of the events and trends that could directly or indirectly affect our local oceanfront and resort condo market.


It’s football season so I’ve included some pictures from my family’s recent tailgate and game at Coastal Carolina University, where both of my sons are going to school. It was a blast!


Also, real estate tax bills have now been sent out. This is a reassessment year and I dedicated a previous newsletter to that topic. If you are an owner, you should have received a notice a while back with your new assessed value. Here’s a link to our Closed Sales Histories, which shows details for all closed sales since 2009 for about 200 Resorts.


BeachProTeam.com/nl-ClosedSales



First, let’s take a look at local market stats.




 “Labor Day in North Myrtle Beach”

Oceanfront and Resort Condo Market Conditions


Overview: After a busy September, sales activity has slowed significantly in the first two weeks of October. Despite having some well-priced listings, I’ve only had a couple of showing requests. Some of this could be caused by the upcoming presidential election. More on that below. Historically, buyer activity for October and most of November has been pretty strong so maybe it’s just a blip. 


The overall market conditions have not changed. Listings for large condos, particularly ones in good condition with lots of upgrades, are relatively scarce and the prices are holding up or dropping slightly. For the smaller condos in most buildings, it’s a buyer's market. A few buildings with exceptional rentals are bucking this trend.


Sellers: My advice continues to be - if you want to cash out on the big price increases in 2021 in 2022, now is the time to do it. I don’t see any more upside for a long time and there is a real risk prices could decline. There is even more uncertainty now because of the recent storms and the upcoming election. It’s also a good time to sell because we are at the end of the peak rental season. Please contact me if you want to discuss a property you own.


Buyers: You have far more choices than have been available in the past several years and there are some motivated sellers out there. Contact Teressa or Kevin to help you find the perfect property.

Active Oceanfront Condo Listings


As can be seen in the chart below, the number of active oceanfront condo listings increased slightly after being flat for a couple of months. As of October 15, there were 1006 active listings, compared with 995 last month. The number of active condo listings off the beach also increased, to 1778 (up from 1749 last month).


Oceanfront Condo Monthly Metrics


The next chart shows month-to-month metrics for oceanfront condos. Everything was down except the number of active listings, which was up 1.1%. Most notably, the pending sales were down 15.7% from the previous month. Closed sales (only 99 on the entire Grand Strand) were down 3.8% from the previous month and 25 %from September 2023.


New Homes and Resales


The chart below shows single-family home stats for September. There were more new construction closed sales than closed resales, 495 vs. 419. Once again, there were far more new resale listings than new construction listings, 647 vs. 447. The median sales price for resales was $367,500 vs. $349,325 for new construction.



 “Coastal Carolina Mascot and Band”

What Factors Will Influence Our Oceanfront/Resort Condo Market?


As I’ve reported, the number of sales this year is trending far lower than in the previous several years. Prices for smaller condos have generally been declining and they have been stable or slightly declining for larger condos. What will happen in the coming months and years? I’m not going to guess but here are some events and other factors that will shape our market.


Rental Incomes


Rental income is one of the main factors determining the value of a vacation rental property. In an admittedly unscientific analysis of the 2024 vacation rental incomes versus 2023, it appears that the incomes are either flat or down slightly for most resorts this year. We checked on the year-to-date incomes through August (which would include the entire summer) for nine of my listings. All of these were oceanfront condotels. All were handled by rental management companies (7 with onsite rental companies and 2 with offsite companies). On average, the incomes were down about 10% from incomes in 2023. Just one was higher and it was only by 1.5%. The incomes in many resorts are now almost back to where they were during the long flat price period which went on for about a decade prior to 2021.


This year-over-year decline is a trend I have observed since 2021. It definitely appears now that the huge 2021 income increase was an anomaly rather than the new norm. One important exception to note is that, at least based on a few of my client’s performances, owners handling their own rentals through Airbnb and VRBO have not seen rental income declines over the past few years. I’ll cover this subject in more detail in a later newsletter.


Interest Rates


Hopefully, these will finally come down over the next year or so. Lower interest rates are good for real estate in general because they make it less expensive to borrow money to buy. Even though over half of our oceanfront condo purchases are made with cash, that still leaves a substantial number that are financed. Low mortgage interest rates are good for investment real estate indirectly as well. It generally means that rates of return for very safe investments are also low, making real estate, which is inherently riskier, more attractive.


"Coastal Carolina at the 4 Yard Line"

Insurance


Most condominium complexes had slightly lower insurance premiums this year. I don’t believe it’s because the insurers lowered their rates. It’s mainly because the property management companies representing the resorts shopped around and got creative, often shaving off layers of coverage they didn’t think were essential. By the way, Teressa was instrumental in this, identifying a major insurance savings idea for the development where she lives. It was subsequently adopted by dozens of other HOAs, resulting in total savings in the millions. 


Unfortunately, there are storm clouds on the horizon (no pun intended). Two major hurricanes just hit the US, causing massive damage in Florida, Georgia, North Carolina, and Tennessee. There are also monstrous wildfires burning around the country. Climate change is not a hoax. It’s costing US lives and hundreds of billions of dollars per year in losses and higher insurance costs. Keep in mind too that insurance rates are affected by catastrophes around the world - not just here. There is no end in sight for this so insurance rates will almost certainly continue to increase for the indefinite future. 


Areas most at risk, of course, have higher insurance rates. Currently, Florida has the highest in the country and their rates are getting ready to go higher. Believe it or not, Nebraska’s rates are number two (tornado alley!). South Carolina’s rates are among the highest as well, particularly in the coastal areas. 


Election


I mentioned earlier that sales activity seems to have slowed down the past week or two and speculated that it may be because of uncertainty over the upcoming presidential election. There is no way I’m going to wade into a discussion of the two candidates except to say that their plans for governing are radically different. The decisions made by the next administration will have major impacts on real estate in general for the next four years and probably for many years after that.


Speculation: Florida Exodus?

Florida's condominium owners are facing significant increases to their already sky-high insurance costs. Also, upcoming laws (going into effect by the end of this year) requiring regular inspections and funding reserves for structural improvements are adding further financial pressures on condominium associations. These are coming in the wake of recent tragedies like the Surfside condominium collapse a few years ago. I’ve heard rumblings of similar laws being considered by South Carolina legislators.


Will all this be enough to drive Florida condominium owners out of the state? And if so, will some of them repurchase in Myrtle Beach? I can’t remember the year but there was an oil rig pipe leak in the gulf which prompted a huge number of tourists to come to Myrtle Beach instead of The Gulf Coast. Could the same thing happen for condo owners?


I feel sure we will see at least a few but I don’t know if it will be enough to influence our market. Although our condo prices are generally lower, our insurance costs are also higher than in most other parts of the country so they may sell in Florida but choose to buy somewhere else. As I said, this is pure speculation, but it’s one of the factors that could affect our market if a large number of owners end up buying here.


"Coastal Carolina Student Section"

That’s all for now.


Check out all our usual Grand Strand Market Reports, Sales and Listing Updates, and new Beach Pro Team reviews.


Please Contact The Beach Pro Team If:


You are thinking of buying or selling an oceanfront or resort condo in our area

                                                                  Or

You are considering moving to our area or know someone else who is

                                                                   Or

You are an agent who has clients thinking of moving here or buying or selling in our area

                                                                   Or

You currently own a condo in our area and want a permanent home here



Beach Pro Reviews

Here is a new review published on Google. 



  • If you’re looking to buy or sell, then give Kevin a call, he’s the best!!! He went out of his way in making sure our purchased went without any issues, and if there were any, he made sure things got back on track, and quickly. Our purchase was from NY to SC and he kept in communication with us the whole time, he was our eyes and ears to what was happening. We don’t plan on selling or purchasing another home, but if we did, Kevin would be first on our list to call. Thank you Kevin for all you did in making our move to SC as smooth as possible. Jackie. Conway.


We just started collecting Google reviews. At this time we have over 30 Google Five Star reviews and over 150 Zillow Five Star reviews which can be seen on our website Beach Pro Team reviews

Grand Strand Market Report

Below is a link to a detailed report on the current state of our local real estate market complete with statistics for just about anything imaginable. Please keep in mind that these statistics cover a broad range of properties and that particular areas or developments may behave quite differently.  

As always please contact me if I can be of service in any way.

See link below to interpret terms used in this report.


Grand Strand Market Report - August 2024

Best Buys

The following current listings are exceptionally well-priced and represent great values. The spreadsheets are sorted by price. These are live links to listing details and they will change according to changes in the MLS (Pending, Sold, etc.). The listing details are in the same order as the spreadsheets. Please call me directly if you find something of interest to you.


OF/OV Homes Brochures:    Link to Listings 

OF/OV Homes Spreadsheet:   Link to Spreadsheet  

 

OF/OV Condo Brochures:    Link to Listings

OF/OV Condo Spreadsheet:   


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