Grand Strand real estate prices plummet in November

Grand Strand real estate prices took a dive in November, possibly due to the increase in the number of lower-priced short sales and foreclosures that sold, local Realtors said.

The median price - the price at which half sold for more and half sold for less- of a single family home was $155,000 in November, down 15 percent from the same month last year, according to the Multiple Listing Service. The median price of condos dropped 21 percent, to $92,000, last month when compared to November 2010, according to the MLS.

The drop in prices is the largest decline in prices in a November in several years, according to the MLS.

“We saw an awful lot of short sale and foreclosure sales this past month so I think that may be one reason that the prices were coming across lower,” said Rod Smith, the director of general brokerage for Coldwell Banker Chicora Real Estate.

Short sales and foreclosures - distressed properties - typically sell for less, sometimes at steep discounts, than other properties.

While prices were lower, the amount of activity and number of sales jumped in November, in part due to all the foreclosures and short sales, Smith said.

“It’s very busy,” he said. “Although it’s taken some time, I think there might be a slow build up of momentum.”

Single-family home sales jumped 31 percent in November, when compared to the same month last year, according to the MLS. Condo sales dropped 7 percent last month, when compared to November 2010, according to the MLS.

There has been an influx of quality foreclosures that were priced to sell and have sold quickly, which is boosting the number of single-family home sales, said Scott Ellis, the broker associate of Re/Max Southern Shores and the president of the Coastal Carolinas Association of Realtors.

The condo market, on the other hand, is facing challenges, he said.

“What’s happening with the condo market still is the financing,” Ellis said. “It’s very difficult to move a product you don’t have financing for.”

Many condos can only be purchased with cash and the condo market cannot reverse its downward trend without more availability of financing, he said.

Condos are often bought by investors and fewer tend to buy in the winter months, which may also contribute to the slow-down, Smith said.

The drop in condo sales in the past couple months is a change from most of the year, when condo sales outpaced single-family home sales, said Tom Maeser, a real estate analyst for the Coastal Carolinas Association of Realtors.

“Condos have been the predominant leader for quite a while and we’re not getting that much more inventory other than foreclosures, so you can assume there are better deals and better property in single-family than in condos right now,” he said.

The price drops could also be convincing some renters to become homeowners, which is contributing to the increase in single-family sales, Maeser said.