Price per sq/ft. Mt. Pleasant? (Charleston, Mount Pleasant: days on market, for sale, mortgage)

[sandyq]

I'm hoping to get some objective data to find out the real story on price per sq/ft in Mount Pleasant. Some of the homes we've looked at in Dunes West, Park West, Hamlin etc. are over $200 per sq/ft but then you see them dropping their asking price by $30-75K. What's the deal? Are they asking too much to begin with? Is the market slow? I know realtors are trained to believe and share the news that the market is really not been hit in SC like other parts (they say the same thing where we live now) but really, can someone respond objectively and take their realtor hat off?

[marndt]

I lived in Mount Pleasant in 2001-2002... Those houses were starting in the high 100,s (Park West)
Moved away and back in 2004-2006. Those same houses were 300+. We could not even afford a townhome in Mt. P... Most of the people that purchased in early 2000 are (were) sitting on a goldmine.
The market looks very soft now...word of mouth.
Hope this helps!

[sandyq]

What was the approx square footage for the upper 100's house you refer? I wonder if the market is just not able to bear what they are asking now ($200+ per sq fot)

[marndt]

I think around 2000 sq feet. But with very few, if any upgrades.

[buyhomesincharleston]

Originally Posted by sandyq

I'm hoping to get some objective data to find out the real story on price per sq/ft in Mount Pleasant. Some of the homes we've looked at in Dunes West, Park West, Hamlin etc. are over $200 per sq/ft but then you see them dropping their asking price by $30-75K. What's the deal? Are they asking too much to begin with? Is the market slow? I know realtors are trained to believe and share the news that the market is really not been hit in SC like other parts (they say the same thing where we live now) but really, can someone respond objectively and take their realtor hat off?

Sandy, I am Realtor in Mt Pleasant and here's my opinion: Prices HAVE dropped in the Mt Pleasant area, but the size of the decline really depends on the location: "Inner" Mt Pleasant locations close to downtown have held their values pretty well (I'On, Olde Park, Old Mt Pleasant, Creekside).

However, the farther you go from downtown, the more diverse the decline. Also, it seems that there is a price point where prices are less prone to deflation: Entry-level homes were hard to find under $300K two years ago.

Today there are 135 listings you can buy for under $300K in Mt Pleasant. So prices in that segment of the market HAVE come down substantially (currently $150-180 psf). But remember that prices went crazy in 2004 and 2005, so this is just a "fair correction".

There are almost 400 homes for sale between $300-500K. These homes are usually newer, and their average price per sq. ft. is between $170-200.

There are over 300 listings between $500-750K. These tend to also be newer, semi-custom homes, with prices per square foot between $200-250.

And there are another 300+ listings over $750K, which tend to all be custom-built homes, and prices psf between $280 and $400.

Price per sq ft. depends on several factors: 1. Size of the home (the smaller the home, the higher price per sq ft compared to similar homes); 2. The location (neighborhood & access to downtown/freeway); 3. The age of the home; 4. The quality of its construction and finishes (i.e. level of customization)

If you are interested in buying in a specific neighborhood, I can send you the stats for that neighborhood going back a few years, so you can appreciate how the market has behaved.

High inventory levels causes negative pressure on prices. We have seen the proportion of Sold Price/List Price go from 99%+ in 2005 to 95-97% now, and this is based on the last list price, it does not take into account prior price reductions. Sellers who NEED to sell must drop their price to a level that attracts buyers (there are still buyers around, sales volumes are at the 2003 level). It's a great time to buy!

Now, will it level off at the beginning of 2008. That is a hard question, one that I get asked daily. My crystal ball: New home construction activity has almost ceased. There are virtually no specs or investors in the market. At the current inventory and absorption levels, it will take us 6-12 months to return to a balanced market. But I believe than in 2009 prices will start climbing up again, because Mt Pleasant (and the whole Charleston area) has strong demographic fundamentals: increasing demand for coastal areas from retiring baby-boomers, strong employment generation and solid economic pillars (military, tourism, health, port).
Hope this helps!

[sandyq]

Thanks so much for you objective insight. Here is an example of where we are not sure the true value in a market we are unfamiliar with: 3100 sq/ft house in Dunes West (not sure the sub neighborhood). Original asking price $599, dropped to $549 and still isn't moving for several months. House is nice, but no spectacular upgrades (i.e. no granite) We aren't even sure if the price was originally higher than 599, how do we check this? We just happen to see it drop. I guess it becomes a realtor game with taking off market and putting back on so there isn't public history?
Also, allot of homes stated 3100-3500 sq ft and they really didn't look bigger than ours which is $2900, I know that may be subjective. Thanks for any help you can give

[buyhomesincharleston]

Originally Posted by sandyq

Thanks so much for you objective insight. Here is an example of where we are not sure the true value in a market we are unfamiliar with: 3100 sq/ft house in Dunes West (not sure the sub neighborhood). Original asking price $599, dropped to $549 and still isn't moving for several months. House is nice, but no spectacular upgrades (i.e. no granite) We aren't even sure if the price was originally higher than 599, how do we check this? We just happen to see it drop. I guess it becomes a realtor game with taking off market and putting back on so there isn't public history?
Also, allot of homes stated 3100-3500 sq ft and they really didn't look bigger than ours which is $2900, I know that may be subjective. Thanks for any help you can give

Dear Sandyq,
The MLS has a function that lets Realtors track the history of a property, even it it has been withdrawn/expired and then re-listed (by street address).

When my buyer clients are interested in a particular property, I furnish them with:
a) All the neighborhood stats, including recent sales, prices per sq,ft., inventory levels, days on market, median price, etc.;
b) The history of the listing in the MLS; and
c) The sales and mortgage history (from the tax records) for that specific property.
These additional bits of information lets us make an informed decision when it's time to make an offer.

For example, if you know that the Sellers are "maxed out" on their equity (i.e. they have taken out equity lines or loans totalling close to the list price) you know that it is very unlikely they will accept a lower offer because they would have to either convince their lender to take a short sale, or come up with money to cover the difference at closing.

If, on the other hand, the Sellers have owned the home for a while and have substantial equity in the home, they may be more willing to negotiate a reduced price. The right information at the right time can be very useful.

In your particular case: For that price range you are probably looking at a home in the gated portion of Dunes West, These homes tend to be in a higher price bracket, but move slower than the ones "outside the gates". In the whole of Dunes West (inside and outside) there are currently more than 100 homes on the market. In this "slow season" we can expect anywhere from 5 to 10 sales per month (absorption rate). So sellers can expect their home to remain on the market anywhere from 12-24 months - unless they price aggressively, and become the best "value proposition" for buyers like you. You are seeing price reductions from sellers who are motivated to sell now, rather than wait for the Spring season.

Regards,
Buyhomesincharleston

[emilybh]

Originally Posted by sandyq

Thanks so much for you objective insight. Here is an example of where we are not sure the true value in a market we are unfamiliar with: 3100 sq/ft house in Dunes West (not sure the sub neighborhood). Original asking price $599, dropped to $549 and still isn't moving for several months. House is nice, but no spectacular upgrades (i.e. no granite) We aren't even sure if the price was originally higher than 599, how do we check this? We just happen to see it drop. I guess it becomes a realtor game with taking off market and putting back on so there isn't public history?
Also, allot of homes stated 3100-3500 sq ft and they really didn't look bigger than ours which is $2900, I know that may be subjective. Thanks for any help you can give

I think you need to find out how motivated the sellers are. the more motivated they are the lower the price they'll accept. You have nothing to lose by putting in a low ball offer of $400k. The worst thing that can happen is they don't counter your offer in which case you can submit a slighty higher offer, see if they counter or withdraw the offer and move on to another property. Who knows, the seller may kick hiimself and come crawling back asking if your lowball offer of $400k is still good, after he has a chance to think about it for a while (and starts seeing showings slow down and NO OTHER OFFERS come in). That's what happened to me in selling my property in the northeast.