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Strand home sales slow but prices still increase

The Grand Strand had the largest drop in home sales of any area in South Carolina in February - but it continues to show price jumps while other beach areas show price declines.

Sales fell 26 percent on the Strand for homes and condos combined, according to the S.C. Association of Realtors. Median prices increased 10 percent year-over-year, while the Hilton Head area dropped 22 percent, Beaufort dropped

8 percent and Charleston increased by a half percent.

"Both the Myrtle Beach area and Charleston continue to see sluggish sales but prices that are at least holding their own or climbing,"

said Don Schunk, research economist at Coastal Carolina University.

The trend of falling sales and increasing year-over-year prices has continued for several months on the Strand.

Real estate experts say it's hard to glean an exact picture of what's to come from the first two months of the year, but they say it continues to be a good sign that prices show year-over-year increases.

Insurance costs have played havoc on the market, and experts aren't sure how a clamp-down in the subprime mortgage industry will affect first-time buyers in South Carolina.

"It's hard to predict a trend off of your two slowest months of the year," said Nick Kremydas, chief executive officer of the S.C. Association of Realtors. "Deeper into the spring we'll be able to look at April and May and predict the rest of the year. But the mood is optimistic."

Schunk agreed it's hard to say what's to come. "It will be interesting to see what happens in the next few months, March through June. I'm not sure what's going to happen with those numbers," he said.

The condo market is seeing most of the double-digit sales drops, while the single-family market has seen only small decreases.

Schunk said the fundamentals for the Strand to have a pickup in sales are in place - rapid population growth and a strong economy with employment growth.

For sellers who might be concerned about getting a home sold, Schunk says be patient.

"The numbers suggest that if you're patient enough, eventually there is going to be a buyer for that house and eventually they'll be willing to pay a price that sounds pretty reasonable to you," he said.

While traffic at real estate offices has been up, not too many buyers are making offers, said Tom Maeser, market analyst at the Fortune Academy of Real Estate.

Some buyers are waiting to see if prices will drop more, while others are starting to think they might have bottomed out, he said.