CHARLESTON, You Have To Stop Renting Immediately!
I remember it clearly. It was a sunny and muggy day, as many are when you live this far south and this close to the ocean. I sat in my leasing office in Mount Pleasant, SC. I had prepared for the day as much as possible the night before but I sat there anxious, nervously holding my 2 week notice. I was making the bold jump from Property Management to Residential sales. Though I was blindly jumping off the “faith” branch, I knew the strength of the market and that it was now or never.
I’m grateful I made the transition. I’m also grateful for the time I worked in property management because it has given me the knowledge to empower my clients. I’m happy to share my experiences with you now. In both positions, renters consistently told me the reasons they were choosing to rent instead of buy.
- “I have no money saved up for a down payment.”
- “It’s too expensive.”
- “I have bad credit.”
I plan on addressing all of these over the next few posts. But quite simply, the top reasons people don’t buy a home is because they don’t know they can or they don’t know they should! I’m here to tell you that you can! I’m here to tell you that you should! Today I’m going to focus on negating one reason (or excuse) in particular I often heard from perpetual renters. It’s the excuse that goes something like this: “I need to wait to find out exactly where in town I want to live before I commit to buying.”
While leasing apartments for a living, I often met people moving from out of town for whatever opportunity life had presented to them. New job, retirement, etc. Upon meeting, almost all of them had the same thing to say. They had driven all over town the entire day looking for an apartment because they didn’t know what area to live in other than one area in particular due to the advice from their brother’s coworkers cousin who knew someone who lived here in the 90s (OK, not all of them had THAT same story). Many told me that because they weren’t even sure where to rent, they wanted to wait a year or so before purchasing a home. If you’ve moved to a new area chances are that you’ve said the same and done the same thing. I’ve done the same. Sometimes its wise to wait to buy. But I’m about to give you real numbers as to why I can’t advise anyone to wait in today’s market. This data comes from the Charleston Trident Association of Realtors and it speaks for itself.
- In April 2016, in the Tri-County area of Charleston, SC 1,476 real estate transactions occurred at a median price of $239,700.
- By May 2016, the Tri-County overview shows 1,629 homes sold at a median price of $246,500. (Guys, that’s crazy! In one month more homes sold and with a median price difference of almost $7,000! Prices are going up.)
- According to Trulia, the Charleston market trends indicate an increase of $13,000 (5%) in median home sale,s over the past year, with a price per square foot increase from $179 to $185.
Why are prices skyrocketing? There are many factors but the simple explanation is supply and demand. With expansions of Google, Boeing, and now Volvo opening along side many other companies, jobs are being created and moved to the Lowcountry. People are moving here, and rapidly. We do not have enough homes on the market to keep up with the forecasted demand. So…prices go up. (Side Note: this is a great reason to SELL your home right now!)
Real Estate agents are finding themselves in Multiple Offer situations and buyers are having to make compromises on location, price, and features that they might not have had to make a year ago. But this may only get worse if the number of homes on the market continues to decrease and if prices keep increasing. Every month you wait, you could be forcing yourself into the corner of even more compromises.
Not convinced?... Right now rates are still at an all time low hovering slightly over the rates from the Great Depression. But experts are predicting their rise. If the interest rates go up just 1% you could be paying the same monthly payment but getting $10,000 less of house! That means you would have to forget that granite, those hardwoods, or that master suite you loved.
Lastly, Trulia shows Median rent in January was $1600 in the Charleston area. Today’s median rent is $1875!!
Why are you still sitting there?! My phone should be ringing with you on the other line.
Here’s the gist of it. When moving to a new area you are already committing to live in a home for 6 months, a year, maybe even 2 years (which is the commitment needed when purchasing a home!). You are committing whether you are committing to buy or committing to rent. So why are you committing to pay down someone else’s mortgage? Why aren’t you committing to better your life by building your own equity? Now is the time.
Just like me sitting nervously in that office getting ready to hand in my two week notice to explore the world of real estate. It’s time for you to at least explore the option of buying. It’s time for you to make a move.
The Jim Mills Team / AgentOwned Premier Realty
For a list of homes available for purchase in the Lowcountry, visit https://www.jimmillsrealty.com/.