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Investment Property Charleston SC | Income Producing Real Estate

CHARLESTON SC INVESTMENT PROPERTIES & INCOME PRODUCING REAL ESTATE

For investors in Charleston SC the real estate game is a tricky one. We all made thousands and — probably millions if you add it all up — flipping houses, leasing offices and renovating condos. Then the real estate market collapsed, throwing the U.S. into the 2007-2009 recession.

Now the prognosis for real estate investments is looking much better, though it’s anything but simple. Some commercial real estate has rebounded, with investors craving income that real estate provides, while Low-country residential Charleston real estate — particularly single-family homes — may be at once-in-a-lifetime bargain prices.

Four top experts were asked for their take on the the opportunities and potential pitfalls facing real estate investors in the coming years. Edited excerpts of their interviews follow:

Jim Sullivan, managing director of REIT research, Green Street Advisors

Every diversified investor should have some exposure to commercial real estate, and REITs [real estate investment trusts] provide a terrific, transparent and liquid way to get that exposure. Operating fundamentals in most property types range from good to great, with good being the shopping center business and industrial business and great being the apartment business. The economy is not doing great, but the silver lining for commercial real estate is how little new supply is coming on the market. Too much new commercial construction is typically what puts a halt to real estate recoveries. This time around, it’s just not an issue.

Multi-Family Income Properties

 

REITs tend to be specialized by property type. You can pick and choose, depending on what your economic outlook might be. If your forecast is a little rosier, you’d want to be in property types that respond well in economic recoveries — hotels, for example, or REITs that own shopping centers with lots of small tenants. If you wanted to be a bit more defensive, health care REITs are a terrific place to be. When investing in Charleston real estate the safe bet would obviously be in tourism based avenues considering that is the most consistent driver of revenue.

The biggest opportunity is buying distressed single-family homes, because that market has been completely beat up. The next biggest opportunity is buying land because very few people have been focused on it. If you have a long-term view, you’ll probably see a significant multiple return. Buying land is a complicated business, though. Mom-and-pop investors should not be buying land.

Lauren Pressman, director of investment research at wealth management firm Aspiriant

The U.S. is in a period of sustained but very slow growth. Job reports are huge factors for real estate, because jobs create demand for housing, for offices, for travel and at retail establishments. We’re wary of things like retail and office, except in very unique circumstances. Multifamily real estate (apartment buildings) arguably had all the tail winds at its back to do the best of all asset classes. However, be careful. There is so much capital chasing multifamily, and that can lift prices beyond a point where your return is commensurate with risk.

No matter what your strategy is always be careful and have a good local agent to help you navigate through the maze of options out there for investing in real estate in Charleston or anywhere. Find a great contractor in Charleston and let them help you with the renovations, and repair necessary to get a C.O. and move onto the next real estate opportunity.

VACATION RENTALS

One of the long tried and true income producing real estate investments popular in Charleston area is in beachfront homes or resort vacation rentals. It’s no mystery that homes in beach communities are very attractive year round and hundreds of thousands of visitors come to our beaches in S.C. to unwind. Homes for sale on the Isle of Palms and in Wild Dunes real estate make big money on weekly vacation rentals for their owners. Many developers and investors will even buy an existing home, tear it down and build a new one just for the returns it can produce. Weekly rentals on Folly Beach, Kiawah, Seabrook Island, and even downtown Charleston garner upwards of $4000 to $7000+. Even with HOA Dues in Wild Dunes, Kiawah Island, and Seabrook Island + monthly regimes for condos/villas these properties can get easily $30,000 yr for one bedroom to $90k+ for beachfront and 3 bedroom units. 

There has never been a better time to pull money out of the equities market and into real estate, rates are low, and prices are too.

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Ways To Decrease Home’s Insurance Cost Charleston, SC

Charleston SC home insuranceThe factors that determine the cost of your home’s insurance expenses varies greatly as one can imagine. However, here in Charleston SC there are additional concerns that we have to consider like; wind from hurricane’s, flooding from, and the intense heat our summers bring. All these contribute greatly to the longevity and strength of your home’s structural integrity. Age of a home is one of the largest negatives when it comes to the price of house insurance because the older the home the more likely there are defective, outdated, and deficient structural components that are likely more apt to fail or be at greater risk. The design of the house is also a huge consideration to carriers when quoting your policy. When considering buying a home it’s a good idea to look at a newer home (no more than 20 years old) if saving money is something you are concerned with. If your home was built in 2008 or later, make sure you are getting credit from your insurance company for having a home that meets modern building codes. Also, if your home has a hip roof – a pyramid-like roof that slopes on four sides – be sure your insurer is factoring that into your rate, because hip roofs are more hurricane-resistant than gable roofs.The amount of the incentive varies according to risk associated with the geographical location, building materials, and construction methods of each home as well as actuarial data from individual insurance companies. (Discounts apply only to the hurricane-wind portion of your policy; contact your insurance agency for more information.)Considering all this, you may still qualify for a DISCOUNT ON YOUR HOMEOWNERS INSURANCE. To qualify you must submit an inspection from a state certified wind mitigation inspectorlicensed contractor, building inspector, architect, or engineer, legally validating and identifying the existence of any wind mitigation measures such as below: (Insurance providers will have the form needed to give to one of the experts listed above).

FACTORS THAT DETERMINE COSTS:

  1. Roof ShapeTypical Construction Features that Reduce Wind Damage and Loss
  2. Roof Deck Attachment
  3. Roof Covering
  4. Roof to Wall Connectors
  5. Window Protection
  6. Door Protection
  7. Secondary Water Resistance (barrier)
  8. YEAR BUILT
  9. Updated Electrical system
  10. Secured and improved foundation
  11. Replace with new Roof
  12. Remove large tree limbs hanging in or around home
  13. Type of Windows (quality and impact resistant wind rating)
 * For Flood Insurance – Newer foundation Vents (such as smartvents.com)If you have a hip roofpermanently installed approved shutters for windows and doors or any of the above credits you may qualify for discounts on the wind portion of your insurance policy.The most likely discount for home- owners to overlook is roof tie-downs, generally metal clips or straps attaching the roof structure to walls of the home. Qualifying roof tie-downs can result in an annual premium discount in the low single-digits, but that could add up to real money if you’re owed a retroactive discount.
Info Gathered From: American Property Consultants

Keep in mind that each year it is very likely your insurance premiums will increase and honestly for no other reason than your insurance provider wants to make more money, and feels they can justify the increase because the house is one year older. So it’s a good idea to shop your home’s insurances EVERY year to save money.
Consulting Provided By: Charleston’s best General Contractor

Charleston SC Mortgage Rates Near Record Low

Mortgage Lenders Charleston, SC

What to Know How Much You Can Afford?

The average U.S. rate on a 30-year fixed mortgage has fallen to near its record low set earlier this month bringing down the rates for those of us here in Charleston, SC as well.The rate on the most popular mortgage dipped to 3.37% from 3.39% last week, mortgage buyer Freddie Mac said Thursday. Two weeks ago, the rate reached 3.36%, its lowest level on records dating to 1971.The average rate on the 15-year fixed mortgage, often used for refinancing, set a record low of 2.66%, down from last week’s 2.7%.Cheaper mortgages are helping fuel a modest but steady housing recovery, coupled with falling inventory the Charleston SC housing market has seen a dramatic uptick in recent months.The average rate on the 30-year loan has remained below 4% all year. And rates have fallen even further since the Federal Reserve started buying mortgage bonds in September to try to encourage more borrowing and spending.The Fed said it would continue buying bonds until the job market shows substantial improvement. When home prices rise, people tend to feel wealthier and spend more freely. And consumer spending drives nearly 70% of economic activity. Charleston, SC real estate agent and ex-mortgage professional states:  ” be prepared for mortgage rates to eventually increase as soon as the fed realizes they can’t afford to continue to purchase bonds in order to fund the housing market recovery.  A natural housing recovery not based on artificial measures is what will achieve a proper recovery; buying bonds is simply a band-aid”.Home sales have risen from last year, and prices are rising more consistently in most areas. Charleston SC home builders as well as those around the U.S. are more confident and starting more homes. Lower rates have also persuaded more people to refinance. That typically leads to lower monthly mortgage payments and more spending.Not only builders in Mt. Pleasant SC, but also throughout the nation last month started construction on single-family houses and apartments at the fastest rate in more than four years, the Commerce Department said Wednesday. And they laid plans to build homes at an even fast pace in coming months — a signal of their confidence that the housing rebound will last.Other recent reports have shown marked improvement in the housing market five years after the bubble burst.Still, the housing market has a long way to a full recovery. And many people are unable to take advantage of the low rates, either because they can’t qualify for stricter lending rules or they lack the money to meet larger down payment requirements.To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1% of the loan amount.The average fee for 30-year loans was 0.7 point, unchanged from last week. The fee for 15-year loans also held steady at 0.6 point.The average rate on a one-year adjustable-rate mortgage edged up to 2.60% from 2.59%. The fee for one-year adjustable rate loans was stable at 0.4 point.The average rate on a five-year adjustable-rate mortgage rose to 2.75% from 2.73%. The fee was unchanged at 0.6 point.

 EASY MORTGAGE CALCULATOR

Some Content By: USAToday.com
 

Charleston Real Estate Market Trends and Activity

CHARLESTON, SC—(October 10, 2012) According to preliminary data released today by the Charleston Trident Association of REALTORS® (CTAR) 876 homes sold in September, surpassing last September’s mark by more than 100 sales. Pricing in the Charleston area has made positive gains throughout the year, with September’s closings resulting in a median sale price of $190,000.Real Estate in Charleston SCThe year-to-date and inventory figures show the Charleston market’s continued progression back to a healthy, balanced and sustainable market. Year-to-date, MLS data shows a 10.5% increase in sales and a 5.6% increase in median price for the region. In 2012, 7,879 homes have sold at a median price of $190,000. At this point last year, 7,125 homes had sold at a median price of $179,850.While it is common for inventory to decline heading into the fall and winter months, it is significant that tri-county inventory has dropped below the 6,000 benchmark, with 5,878 homes listed as actively for sale with the Charleston Trident Multiple Listing Service (MLS). MLS data shows 6.7 months of residential inventory—most experts consider 5-6 months a mark of a healthy and balanced market. Charleston SC home builders also report seasonal declines in contracts to build new homes during the winter months.“The available inventory is pushing our market not only towards balance, but slowly back towards the seller’s favor. We’ve been squarely in ‘buyer’s market’ territory for several years now. The market has made its corrections and we’re well-positioned for sustainable positive progress going forward,” said Herb Koger, 2012 President of the Charleston Trident Association of REALTORS®.Average days on market has declined significantly as well, with all three counties reporting 100 days or less to sale, and Charleston County averaging a speedy 87 days in September. The faster pace of buying activity is being encouraged by a significant number of investor buyers in the Charleston market, who deal largely in cash, negating the wait time for lender approval.August Adjustment Preliminary data reported for August 2012 indicated 1,014 homes sold at a median price of $198,757.  Adjusted numbers now show 1,025 sales at a median price of $199,900.Berkeley County Preliminary data shows 197 homes sold at a median price of $175,000 in Berkeley County in September; with an average of 92 days on market.  Year-to-date, sales volume has increased about 1% and prices have grown by 6% compared to last year, with 1,689 sales in the county at a median price of $164,300.Find additional reports on Berkeley County, hereCharleston County, SC Preliminary housing data shows 502 residential transactions in Charleston County in September, at a median price of $216,768.  Days on market dropped to a year-low of 87 days. Year-to-date, sales have increased 17% and pricing has made a healthy 2% gain over 2011 data.  Thus far in 2012, 4,494 homes have sold at a median price of $225,000 in Charleston County.Find additional reports on Charleston County, hereDorchester County Preliminary data shows that 153 homes sold at a median price of $175,000 in September in Dorchester County, in an average of 100 days on market.  Year-to-date, sales volume has grown by 3% and prices have increased by nearly 4%, county-wide, compared to last year.  In 2012, 1,428 homes have sold at a median price of $167,222.
Article By CTAR

Mortgage Rates in Charleston, SC Stay Low – Lenders, Banks

CHARLESTON, SOUTH CAROLINA – Average mortgage rates on fixed mortgages fell this week and are just slightly above record lows reached earlier this year. The low rates have contributed to a modest housing recovery.

GSE Freddie Mac said Thursday that the rate on the 30-year loan declined to 3.59%, down from 3.66% last week. Five weeks ago, the rate fell to 3.49%, the lowest since long-term mortgages began in the 1950s.
Mortgage Lenders Charleston, SC

Latest Mortgage Information, Rates, News, Trends, Calculators

The average on the 15-year fixed mortgage, a popular refinancing option, slipped to 2.86%. That’s down from 2.89% last week and from the record low of 2.8% five weeks ago.Cheap mortgages are a key reason the housing market is finally started to rebound five years after the bubble burst. However, another large factor is banks are not releasing the foreclosed homes they have on their books, and are sitting on them thus reducing the inventory and increasing demand. Sales of newly built and previously occupied homes are well above last year’s levels. Prices have increased consistently, largely because the supply of homes has shrunk while sales have risen. And Charleston SC builder confidence is at its highest level in five years, mean while home builders in areas like Mount Pleasant, SC are seeing very good signs of growth. Scott’s Creek in Mount Pleasant, SC neighborhood has 18 homes under construction currently and more under contract.Still, the  Charleston SC housing market has a long way back to full health. Some national economists forecast that sales of previously occupied homes will rise 8% this year to about 4.6 million. That’s well below the 5.5 million annual sales considered healthy. Many people are still having difficulty qualifying for home loans or can’t afford larger down payments required by banks. If you need help with home financing in Charleston South Carolina and need advice contact me at.

Charleston SC Mortgage Rates

National overnight averagesToday+/-
30 yr fixed mtg3.54%
15 yr fixed mtg2.89%
5/1 ARM2.86%
$30K home equity loan5.68%
$30K HELOC4.58%
About these rates
Mortgage rates in Charleston SC are low because they tend to track the yield on the 10-year Treasury note. A weaker U.S. economy and uncertainty about how Europe will resolve its debt crisis have led investors to buy more Treasury securities, which are considered safe investments. As demand for Treasurys increase, the yield falls.To calculate average rates, Freddie Mac surveys lenders across the country on Monday through Wednesday of each week.The average does not include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1% of the loan amount.The average fee for 30-year loans was 0.6 point, down from 0.7 point last week. The fee for 15-year loans also slipped to 0.6 point from 0.7.The average rate on one-year adjustable rate mortgages fell to 2.63% from 2.66% last week. The fee for one-year adjustable rate loans was unchanged at 0.4 point.The average rate on five-year adjustable rate mortgages declined to 2.78% from 2.80%. The fee held steady at 0.6 point.
Most Article Content By USAToday.com

Home Sales Increasing Charleston, South Carolina – Real Estate Market Better

Existing-home sales kept up their recovery in July, rising 2.3% as prices jumped 9.4% from a year ago, according to the Charleston Trident Association of Realtors, but the market’s progress disappointed analysts who expected more.Smaller inventories of homes for sale let sellers push prices higher, the association said. The average price of a new home rose 9.4% to $187,300, aided by a shift in the mix of homes sold, with fewer low-end units included. “I am seeing multiple offers within in first week a nice home comes on market,” Isle of Palms Realtor, James Schiller.Nationally, the number of homes sold rose to a seasonally adjusted annual rate of 4.47 million. The numbers missed economists’ expectations of about 4.52 million home sales, according to Drew Matus, an economist at investment bank UBS.“Mortgage interest rates have been at record lows this year while rents have been rising at faster rates,” NAR Chief Economist Lawrence Yun said in a statement. “Combined, these factors are helping to unleash a pent-up demand. However, the market is constrained by unnecessarily tight lending standards and shrinking inventory supplies, so housing could easily be much stronger without these abnormal frictions.”Independent economists are looking for the housing market to begin slowly reversing its more than 30% slide in prices, though most do not expect substantive price gains until at least 2013 or 2014.“It was a little below expectations but still good,” said Mike Zoller, an economist at Moody’s Analytics. He said the sharp gains in prices reflect the smaller percentage of foreclosure-related distress sales included in the numbers, as well as the shift to more higher-end home sales.
Tight credit or worries about jobs may be prompting buyers to stay on the sidelines, said Patrick Newport, an economist at IHS Global Insight. The gain in home sales was the second-smallest reported this year, he added. As long as the buyer has good credit, money to put down, and good job security getting a loan is still easy by most standards.
“These are not great numbers,” Newport said. “We have record-low mortgage rates. Something is going on.”The economists also disputed the Realtor association’s argument that sales might be stronger if more homes were available.Nationally, inventories of available homes work out to about six months’ worth of expected sales, Zoller said, a level he called “reasonable.” The proportion of homes that are vacant is still above 2%, Newport said, citing Census data. That’s higher than a historical norm of about 1.7%, he said.The bright side is that the overhang of foreclosures are finally seeing a decline, relieving an overflow that pushed prices lower, Barclays economist Michael Gapen wrote in a note to clients. About 24% of sales were foreclosure-related, down from 29% last July, he said.
Most Content Courtesy of USA Today

Charleston South Carolina Housing Improves Faster then National Average

If you live in Charleston S.C and are considering selling your home, now is as good time as ever. According to USA Today the Charleston SC area is performing better than the national average.“Inventories also shrank faster than the national average in Minneapolis; Charleston, S.C.; Seattle; Washington, D.C.; Miami; and parts of Southern California, Zillow says”.
Change from a year ago in the number of homes for sale in May by price tier in 100 top markets:
Market
Bottom third
Middle third
Top third
Average
Charleston, SC
-41%
-22%
2%
-20%
United States
      -12%
-17%
-17%
-15%
It now costs more to rent than to own a home in 98 of the top 100 U.S. metropolitan areas, says real estate website Trulia, which tracks rents and home prices. In some of those markets, however, the inventory of homes for sale has shrunk.But low interest rates are luring more buyers, as are home prices that are down 35% from their 2006 peak.Nationwide, 35% of existing single-family home buyers in April were first-timers, according to the National Association of Realtors. In healthier times, first timers account for 40% to 45% of the market, says NAR chief economist Lawrence Yun. Tight credit and a still-shaky economy have kept many first-timers out of the housing market, he says.Rising prices could boost supplyHome inventories have shrunk because fewer foreclosures are coming to market. Many homeowners don’t want to sell, because they don’t have enough equity in their homes. Others are waiting for higher prices.“They’ve waited out five years of declining prices and don’t want to sell at the bottom,” says Stan Humphries, a Zillow economist. As home prices increase, more sellers will likely emerge, he says, which will add inventory. Or, buyers might back off if the economy softens.If you are in need of Charleston area real estate advice please feel free to contact me.James Schiller – Realtor in Charleston, Mount Pleasant, Isle of Palms.