Cunningham Greenville SC Real Estate February 2019 Newsletter

 

A monthly review of our team & the Greenville Real Estate Market

 

GGAR Greater Greenville Association of Realtors, has released their 2019 Housing Profile.

It is full of awesome information which we will summarize here. 

Greenville, SC is one of the most affordable places to live according to the National Association of Home Builders. They actually have an index that measures housing affordability called the Housing Opportunity Index. It figures out a percentage of how many people with median incomes in Greenville were able to buy a home. SO...Can we buy a home in Greenville with an average Greenville income? 

Our current HOI (Home Opportunity Index) for Greenville is 71.7. 

Greenville has consistently ranked as one of the top 1/3 places in the nation most affordable to buy a home. Our median price is $206,000 and median income for these measures is $66,500. 

As housing inventory has fallen in Greenville prices have risen. For one of the first times Greenville median home prices are over $200,000 and price per square foot is greater then $100. As prices rise less people can afford to buy so new construction is critical to increase inventory and keep prices steady. 

The months when most people are looking for homes and listing homes are March - August with March having the most new home listings, typically over 1000 new listings. This past December we had 550 new listing which is up 12% over the previous year so we are off to a fast start this year. Look for prices to loosen up if home sellers are as motivated as early indicators show. 

Get to Know GREATER GREENVILLE's People

Greenville Real Estate Market
DEMAND	Rising
INVENTORY	Falling
PRICE	Rising

In our country every community can be segmented into groups of people with similar likes and dislikes. GGAR has compiled the different types for Greenville, SC. The three main types are: Southern Satellites, Middleburg and In Style. We will detail these three types. Which are you? 

Southern Satellites (SS)

This is the major group in Greater Greenville and makes up 15.1% while only 3.2% are nationally Southern Satellites. The characteristics of this group are that they live in a rural areas close to an economic core area (Greenville) in the South. (go figure) They are slightly older, settled, married, who own homes. 

Homes are 2/3 single family, 1/3 mobile homes. Median household incomes are below average. They enjoy country living and prefer outdoor activities and DIY home projects. They usually own trucks and like to service it themselves. SS own pets, usually a dog, like to hunt and fish and listen to country music. 

Middleburg (MB)

7.1% of Greenville households are this group. Only 2.6% of American's overall are from this group. In the last decade the subdivisions this group lives in has transformed from rural or country living to semi-rural subdivisions. They tend to be conservative, family-oriented consumers. Tend to be thrifty, but carry some debt and are investing in the future. They use their smart phones to stay in touch and are proud of it. They prefer to buy American and travel in the U.S. These folks are younger, but growing in size and assets. 

Middleburg people tend to be locals within metropolitan areas (Greenville). MB tend to be young couples with children, most work away from home. Traditional values of faith, country and family. Trucks are the preferred vehicle, but also SUVs and sometimes convertibles and motorcycles. Sports are hunting, target shooting, bowling and baseball. 

In Style (IS)

This group is much more urban then Southern Satellites and Middleburg preferring to live close to a downtown area. 4.6% of Greater Greenville's households are in this group vs. the national average of 2.3%. The IS group loves all things urban including support of the arts, travel and extensive reading. They love being connected through mobile devices. The group tends to be professional couples or single households without children. They have the time, resources and energy to focus on their interests and homes. They tend to be older and are planning for retirement. 

IS tend to be attentive to prices and use coupons, are partial to late model SUVs or trucks. Homes are important to them with housekeeping hired out. This groups likes to grow their own food or eat organic. Actively support various charities and causes and have insurance. 

 

Greater Greenville Market Data Overview (Condo & Single Family Home Sales)
JANUARY	2019	2018
Homes Sold	651	814
Active Homes	4316	3469
Average Sales Price	$242,326	$231,360
Median Sales Price	$210,000	$191,000
Average Days On Market (DOM)	63	56

 

How ONE Home Sale Helps the Greenville Economy

100% of the economic impact of ONE typical home sale amounts to $64,514

Broken down it looks like this

50.3% Every time 8 existing homes are sold it actually causes 1 new home to be built increasing money in the local area so for every home sold 1/6 of a new home's value is added to the economy =  $32,454

27.7% Income to real estate industries (realtors, builders, inspectors, appraisers, mortgage lenders)  =  $17,523

16.1% Multiplier effect is when the income earned by real estate industries is recirculated into the local economy  =  $10,399

6.4% Spending for home purchase (paint, appliances, remodeling costs & furniture)  =  $4,142

Sources: BEA, U.S. Census, NAHB, Macroeconomic Advisers, NAR, GGAR

 

How New Home Sales Help GREENVILLE's Economy

Back in 2007, 2008 and 2014 the Home Builders Association of Greenville commissioned the Housing Economics Department of the National Association of Home Builders to conduct an analysis of the economic impact of home building in Greenville County on the Greater Greenville area. The study found a substantial impact on local infrastructure (sewers, roads, utilities, schools, postal service, fire and police protection) was more than paid for by the income coming from the purchase of the home and the taxes paid year after year. We will look at how that is possible. 

Let's look at some figures on home building in Greenville, SC. In 2014 3,492 single family homes were built. From the real estate built in 2014 $522.8 MILLION dollars of income were generated, $53.5 MILLION in local taxes and fees were collected AND 7,795 JOBS WERE CREATED. Amazing numbers, good job Greenville. 

That's not all, each year these new homes continue to contribute to Greenville' economy and this has been measured. The impact of the 3,492 new homes built in 2014 have been an additional 1,282 new homes built (remember when a home is bought it creates a demand for another 1/6th home), $107,500,000 in income to Greenville residents, $15,100,0000 in taxes to local governments, and an additional 1,548 new Greenville jobs created. Wow. I love real estate. It really drives our countries economy. 

The recurring impact (what it generates every year) of new home construction is $111,000,000 in Greenville income, $28,000,000 in Greenville taxes, and 2,208 new jobs each year. I can see why the Fed want to encourage home buying and home buyers. These are staggering numbers and they are just for Greenville for just ONE YEAR. 

The consensus from GGAR is that...

GROWTH + NEW CONSTRUCTION more then pays for Itself

For every 1,852 single-family and 532 multi-family homes built

• The first day they are moved into all the costs of building the homes are paid for including the infrastructure costs. 
• The first year the homes contribute more then $63 Million to local governments and $10 Million every year after that. 
• After 15 years, over $220 million have been added to the coffers of the local governments, this help to keep taxes low for everyone. 

Greenville County Multi-Family Impact

Multi-family (which includes condos, apartments, duplexes, & town-homes) has an annual recurring impact as well. For every 1,282 MF homes built in Greater Greenville $28,8 million income is generated, $8.8 million in taxes and 572 jobs are created. All these numbers add up to more money in the local economy and better quality of life for Greenville residents. 

Priced Out Effect

Something that sometimes gets forgotten when government starts to regulate the housing industry too heavily is the impact it has on the home price. Consumers are very sensitive to fluctuations in the price of new homes. Just $1,000 increase in the price of real estate homes makes in impossible for OVER 480 households to qualify for a home loan and therefore a home. 

When looking to change the housing codes legislatures need to think very carefully about the true safety these codes are bringing. By making codes which raise construction and development costs some families can't even live in these new "safer" homes.

In Greenville the median home price is $281,420 and you need $71,295 in annual income to qualify. only 34% of Greenville households qualify. If that home price goes up only $1,000 then 486 households will NOT be able to get a loan for the home. 

 

Working with Lee Cunningham, Renee and their team of professionals at RE/MAX to sell my house was the best decision I ever made. From my initial interview to closing I felt like I was their only client. The 3D presentation of my home was outstanding! People would view the house online and feel like they were actually inside the house. This presentation combined with their dedication to details resulted in my accepting an offer only 6 hours after it was listed for showing, and the offer was $5,000.00 more than my asking price. If you want a professional team that places your interests first, you cannot go wrong with RE/MAX and especially the Cunningham team.                           - Barbara H