You’d be hard pressed to find a Realtor who’ll say their business is slowing down or that lower-end buyers may be shying away from the market, but the statistics say that’s just what’s happening along the Grand Strand.
The April market report from SiteTech Systems not only shows that, but also a potentially fundamental shift in the market that could change the face of the Myrtle Beach area.
Sales of homes priced below $150,000 were down 12.6 percent for the first four months this year compared to the same time last year, SiteTech president Todd Woodard said, while those priced from $150,000 to $500,000 jumped between 32.2 percent and 37.7 percent.
The $150,000 and below segment of the home market has always been the strongest in this area and was what led real estate here out of the Great Recession. And while the shift could be significant, it’s way too early to say that it’s a trend.
In fact, Realtors say they are seeing the same demand on the lower end, but as Woodard notes, the inventory in that category has dropped.
Other factors could be at play too, including an upward trend in the area’s home prices and mortgage rates that rise, even if temporarily, above the comfort level.
Overall, according to the SiteTech report, April’s sales of single-family-homes fell 6.7 percent from March, which was the only stellar month so far this year. Despite that drop, though, total sales year to date were up 2.9 percent over the same time in 2013.
The slowdown reflects what’s happening nationally, said Laura Crowther, CEO of the Coastal Carolinas Association of Realtors. But even that is not spread evenly across the Grand Stand.
Penny Boling of Century 21 Boling said her company posted sales figures in March and April that it hadn’t seen since 2006. She said May is looking equally as strong, and she’s predicting nothing less for the remainder of this year.
Next year, she noted, is poised to be a breath-taker.
As with others, she said the low-end buyers are still plentiful, but she did say there has been a change at the upper levels.
“We’ve got more high-end buyers in April,” she said.
While others said the movement to higher prices was reflective of buyers getting higher prices for the homes they are selling to move to the Grand Strand, Boling said there’s a lot of “moving up” among the locals.
Young couples are trading starter homes for something more substantial and those in the middle level are doing the same thing.
“Even retirees are moving up,” Boling said.
The activity is indicative of a growing faith in the improvement of the overall economy.
“Buyers now are more comfortable, more optimistic about investing,” Jamie Broadhurst, president of Century 21 Broadhurst, said at a recent real estate roundtable.
He said this week that a constricted inventory at the lower end has had its impact.
“It’s beginning to be a bit of a struggle” to find the right homes for low-end buyers, he said.
Part of the problem, though, is that the buyers might not be ready to pull the “buy” lever when they see a home they like. Nowadays, he said, they have to make an offer immediately or risk losing their dream home to someone who’s quicker on the draw.
He said builders are concentrating their efforts now on the lower end, suggesting that the short inventory will be temporary. Woodard said that 40 percent of overall sales now are for new homes and that building permits are up 4.5 percent this year over last, both of which bolster the belief that construction could fill in inventory gaps.
Broadhurst said, though, that high-end buyers are more evident among his customers, although he said some of the inventory may be overpriced.
Charley Ray of Ray Realty in Conway said the sales there continue to improve, at least partly due to the decline in distressed homes for sale.
Sales below $150,000 were strongest in the Conway area for the last year, and if there is a drop-off in that segment, western Horry likely would feel it first.
Woodard said the same trend is happening in condo sales as in single-family homes.
Sales of condominiums priced below $100,000 are down 15.7 percent year-to-year while those selling for above $200,000 are up 2.4 percent.
And while the number of condo sales overall is down, the median sales price for the month - $112,000 - and year-to-date - $108,000 - is above those in 2013.
Prices of single-family homes haven’t suffered with less buying activity, SiteTech numbers show.
The $189,728 median price in April was $14,000 above April 2013, and the median price for the first four months of 2014, $186,500, was up nearly $12,000 over the same time last year.
Although the numbers now may be a bit strange, fret not, say those in the know.
“I don’t think we have any cause for alarm,” Crowther said.
Contact STEVE JONES at 444-1765 or on Twitter @TSN_sjones.