The perfect location, location, location of Myrtle Beach is hot, hot, hot right now in the real estate industry. We know it’s not breaking news, but we want to dig further into the trends and factors that fueled this fire.
Supply & Demand
Today’s seller’s market is a textbook example of the old story of supply and demand. The supply of homes for sale in most parts of our country, especially here in Myrtle Beach, continues to fall far short of demand. How far short? Here, in our coastal Carolinas market area, it’s been a 67.4 decrease from last year in the housing supply overall (single family homes and condos). The trickle-down effect of this stat is that it’s driving up home prices, thanks to home buyers competing with others. But, for homebuyers, the competition doesn’t frighten off buyers – especially millennials who have had time to save over the pandemic. The rise in the median home sale price isn’t scaring them away either, with an average increase to $278,450 in our market alone – a record high. And these homes are selling quick; about half sell in less than a week after multiple offers. The competition is more fierce in suburban areas and medium to small metro areas across the country. While home inventory will eventually increase, it will overall stay a seller’s market.
Unique Buyer Offers & Strategies
Because the competition is so fierce, potential home buyers are taking extra steps to get ahead, which only increases the bidding wars. This may involve offering tens of thousands of dollars above the asking price, offering “option” money or incentives (home gifts or special event tickets), making an all-cash offer, agreeing to let the seller live rent-free in the house for several months after closing, and waiving the inspection or appraisal (the buyer pays the difference in cash at closing). Buyers are not only stepping up their game, but learning it’s more important than ever to stick to the basics, such as being prompt to a home showing and working with an experienced real estate agent to expertly nagivate through this competitive market.
Low Mortgage Rates
Another factor in this seller’s market formula is that buyers can afford today’s higher priced homes because the mortgage rates have remained at an all-time low – below 3 percent, on average, for a 30-year fixed-rate home loan; 2.26 percent on average for a 15-year loan. We’ve seen a slight increase going into spring, but we’re still at an historical all-time low. And it’s going to take time for construction to catch up to demand, so interest rates may rise slightly, but expect them to remain relatively low.
The Pursuit of Warm Weather Out of the City
Let’s face it, the warmer weather of the summers always brings out the foot traffic of home buyers every summer – and, in 2021, this is only even more pronounced. Buyers from the northeast are fleeing from the city and enticed by our warm weather and hospitality.
Strong home sales transactions are expected to continue as vaccines continue to increase, while positive coronavirus cases decrease. Even before vaccines rolled out, the real estate industry was undaunted, and now, with the rollout of vaccines for adults and children, consumer confidence will only strengthen over the summer months.
Sellers Not Selling
Many homeowners chose not to relocate – especially if they were already living in a home with ample space for their remote office and virtual schooling – which directly effects the low supply of homes on the market. Sellers, however, may become more tempted to re-enter the market, given all of the perks and benefits we’ve discussed. That is, if they can find a home to move into out of our area.
To sit down and discuss your plans to buy or sell a home, please call one of us at the Sands Realty Group at 843.839.4878.