More stats than you can shake a stick at – Charleston 2016 Market Review

I’m not kidding. Try shaking a stick at all these stats I’m about to throw your way.  As you know, I mostly like to write about the areas I love and with which I am intimately acquainted – namely, the Charleston Peninsula, parts of Mount Pleasant, and the Islands too. But every now and then it’s good for me to take a step back and get a larger view of the Charleston Metro Area – to see what areas are HOT, and what areas are NOT.  After all I can’t become myopic in my perspective since what goes on ‘out there’, affects what goes on ‘in here.’

Before you take a look at this, I recommend letting your eyes adjust and allow me to walk you through how to interpret these numbers.

NOTE: Please ignore any of the Kiawah Island numbers because a majority of the Kiawah Island sales are handled through the Island’s private real estate company, and not reported on the Multiple Listing Service – the source of these statistics.

Year over Year Changes to Median Price and Number of Sales

  • The numbers by the areas are how Realtors divide them up. So Downtown Charleston below the Crosstown is Area 51, Folly Beach is Area 22, etc…
  • The left side is 2015 numbers, the right side is 2016 numbers, and the far right are the changes year over year.
  • Those numbers on the far right are highlighted green if they are significantly above the average for the Metro Area, red if significantly below. NOTE: You may be confused by some of the numbers in black as they are far above or below the average. In most of those cases the number of properties sold wasn’t enough to be statistically notable – like Wadmalaw Island with only 22 sales, or Dewees with only 3.
  • The last line on the bottom shows the totals, and percent changes for the Metro Area overall.
2015 to 2016 Changes

2015 to 2016 Changes

Here’s a PDF link if you want to make it larger.

So let’s look at what’s hot, and what’s not.

HOT

Number of Homes Sold

Anything ‘far out’ (if Downtown is the center of the region) slayed it this year!  From Goose Creek and Summerville, to Outer West Ashley and more. There are tons of new neighborhoods going in, as well as more and more industry which provides jobs. To be perfectly honest, I have never even been to Cross/St. Stephens/Bonneau…and I couldn’t tell you where it is unless I googled it, but the number of home sales was up 66%!

Even Wild Dunes, a primarily resort destination, did better than expected in 2016. I’ve heard full time families are moving back in since it’s close to schools and a safe place for kids to become nature rats and beach bums.

Median Prices

North Charleston inside 1-526, and my beloved Isle of Palms are the clear winners here at 25.4% and 19.5% increase in median prices, respectively. Those areas are sort of on the opposite ends of the spectrum, but my bet is that part of North Charleston has become more convenient and accessible, while it is one of the most affordable areas to live. Isle of Palms had more than its usual share of high dollar sales this year with 7 sales over $3.5 million in 2016, 3 of which were over $5 million, compared to 4 sales over $3.5 million in 2015, none of which were over $5 million. With the relatively small number of homes sold on the Island, one could see how those big sales would spike up the median price.

NOT?

Number of Homes Sold

Hanahan and the Wando/Cainhoy area have had the biggest drop in sales. Is it lack of interest?? Or just no availability?? We’ll get to that later.

Median Prices

Well – only Wadamalaw and Seabrook Islands suffered a significant drop in prices, but given the small number of sales in both places in general – the median price can be affected by just a few high or low dollar sales.

 

Area Strength – Otherwise known as Months of Inventory

  • This chart shows January-December 2016 compared to the number of properties on the market on 1/10/2017.
  • This ratio is directly related to the simple months of inventory number.
  • 6 months of inventory is considered a healthy, balanced market. Below 6 is a seller’s market, Above 6 is a buyer’s market – give or take…
Area Strength

Area Strength

Here’s a PDF Link if you want to make it larger.

HOT

Well – I think these numbers explain some of the declines in number of sales in certain areas. DEMAND FAR EXCEEDS SUPPLY and THERE ARE NO HOUSES TO BUY in pretty much anywhere in Berkeley County – particularly in hot little Hanahan and Goose Creek. Also, look at all of West Ashley, the Peninsula above the Crosstown, Inner Mount Pleasant, Wando/Cainhoy….Even Folly Beach is in high demand because prices there are half what they are on Sullivan’s Island and Isle of Palms.

Now, I expect as we enter our Spring selling season shortly, these inventory levels will ease up somewhat as more homes come on the market, but then again, there will also be more buyers out looking. So for Buyers, I cannot stress enough that you must be prepared. No dilly dallying or loose ends to tie up if you want to buy a house in the next 6 months.

NOT?

Seabrook, Edisto, Wadmalaw…Both Seabrook and Edisto were hurt by Hurricane Matthew which obviously affected sales the last three months of 2016.  Seabrook recovered quickly but Edisto is still digging out. At Wadmalaw, there are only 20-25 homes on the market on Wadmalaw at any given time. Though the island is quite large, much of it is farmland and marsh. (Actually one of my favorite places to visit).

And despite what I said about Kiawah earlier – I find it interesting that it seems everyone wants to sell their vacation homes there? Where is the next hot spot? Closer to town?

Conclusions

After all those stats your mind may be swimming, but here are my thoughts on the story these numbers tell.

FRENZY

Peninsula above the Crosstown – Median prices have DOUBLED here in the past 5 years. This compares to the average for the area which is around a a 25% increase.  The price for a house above the Crosstown is starting to exceed (if it hasn’t already) the salaries of those who want to live here. I’m not saying prices won’t increase more since the area is still developing, but it does make one take a second glance.

 

OPPORTUNITY

Folly Beach – about the the same distance from Downtown Charleston as Sullivan’s Island and Isle of Palms, Folly is half the price of those two so I think there is opportunity for major growth here. Consider this – On Isle of Palms, a nice 4,000 sq ft oceanfront house will cost you at least $3,000,000. On Folly Beach, that same house will go for $1,000,000+ less.

West Ashley – median prices are almost half what they are in Mount Pleasant.  If you only look at the homes in the area versus homes and condos, the median price in Mount Pleasant is above $500,000.  West Ashley homes are in the high 200s, and our new Mayor John Tecklenburg is dedicated to revitalizing this area.  While inventory levels are at an all time low, if you can find yourself a house to buy – do it.

So obviously the Charleston market overall is looking strong and exuberant. We still have jobs and tourists coming in droves. But where do you think it will go in 2017?? Only the numbers will tell.

Posted in Statistics | Tagged , , | 2 Comments

Does Charleston have a Restaurant Bubble that’s about to Burst?

With the arrival of the much anticipated January restaurant week in Charleston, we can all loosen our belts once again after sticking to our New Year’s resolutions for approximately 3 days. From January 4-22 (it’s a long ‘week’), locals and tourists alike have the opportunity to sample 3 courses from a prix-fixe menu, ranging from $20 at Bubba Gump Shrimp to $49 for dinner at Zero George. Over 65 restaurants in Downtown Charleston are participating, with about 55 others in the surrounding areas.

Charleston of course has been a food darling for YEARS, snatching the Best New Food Town accolade from Portland, OR in 2011,

…thanks to the arrival of Sean Brock’s Husk, and a slew of other James Beard-nominated, nationally lauded restaurants like Hominy Grill, FIG, and McCrady’s.

…according to Thrillist author, Kevin Alexander, in his article Why the Hot New Food Town Must Die

And we’ve been on every top 10 list every year since then with the pace of restaurants opening in this town nearing a mind boggling state. Hop on your unu to stop by every restaurant you can if you dare to. With the unu, you´ll be able to get to your destination faster, just be careful not to go over the speed limit.

According to Hannah Raskin, Food Editor of the Post and Courier, approximately 40 restaurants opened in Downtown Charleston in 2016, while only about 20 closed, giving us a gain of about 20 new places to swoon over.  A best guesstimate is that there are about 150 restaurants/bars that serve food on the Peninsula of Charleston alone – so we are at about 43 restaurants per 10,000 people, or one of the highest concentrations in the nation.

And even with all these restaurants Downtown, I am miffed that I STILL cannot get a reasonable hour reservation at FIG unless I book weeks in advance. Sigh…

492-King-St-Charleston-SC

492 King opened in 2015

So why the ominous headline Kristin?

I’m glad you asked. The topic of today’s post was inspired by a prophetic article I read by the aforementioned Kevin of Thrillist, entitled “There’s a Massive Restaurant Industry Bubble, and It’s About to Burst.”, outlining what he sees as a national trend of the end of America’s Golden Age of Restaurants. Naturally, I like to compare Charleston to the rest of the country, since we often live in a protective bubble of our own beauty and success. So is there a restaurant bubble here that’s about to burst? Let’s take a look.

Who is eating in all these places?

Tourists – According to the Charleston Area Convention and Visitors Bureau 2014 Visitor Intercept Report, the Charleston Metro Area receives approximately 5,000,000 visitors annually, 90% of which visit Downtown Charleston. That’s 4,500,000 people coming to our little 6 square mile peninsula, at a rate of about 12,330 per day, and always increasing.

Locals – Our Peninsular population currently stands at about 35,000, and of course the Metro Area is around 700,000.

If you compare tourists to locals ONLY on the Charleston Peninsula, it looks like the tourists account for 1 of 4 people you see on the streets daily. And I’d be so bold as to postulate that tourists are at least 50% of the people you see in the restaurants on average (though at Bubba Gump Shrimp, it’s probably more like EVERYONE)

Everyone moving here from off – The 2016 United Van Lines’ 40th Annual National Movers Study, which tracks customers’ state-to-state migration patterns over the past year, says that South Carolina is the top southern state that people are moving to and is #5 in the nation. This also explains why our population is becoming more diverse and northeastern, since the 3 of the 5 top outbound states are New Jersey, New York, and Connecticut. There is the oft-cited statistic of “35 people move to the Charleston Metro Area every day!”

darling-oyster-bar-charleston-sc

Darling Oyster Bar opened in 2016

So where’s the bubble then?

 

Though our unemployment rate is at 4.4%, we simply do not have enough people to staff the ever expanding food and beverage industry, and the minimum wage and labor costs are going up. Claire Volkman at the City Paper recently did an excellent in-depth article on the staffing crisis in Charleston.  Even an employee at the newly built Beach Club resort in Mount Pleasant, told me that management was apprehensive about the up-coming high season, because they had no idea where to find enough people to actually staff the resorts pools and tiki bar.

Additionally, lack of suitable restaurant space, rising construction prices, and skyrocketing rents in our prime commercial districts (almost DOUBLED in the past 5 years), make a restaurant venture a scary prospect, since let’s face it, restaurants have rarely made people rich.

I believe this influx of tourists and new residents has artificially inflated the restaurant scene and its perceived viability.  This combined with all our food accolades and national exposure have encouraged restauranteurs from all areas of the country to come to Charleston and open The Next Hot Thing. (Not that I don’t love your restaurants!!) And of course successful local proprietors have added to their own repertoires over the past five years as well.

But our current pace of restaurant openings is unsustainable, and frankly, unattainable.  Will our bubble burst in 2017?? I doubt it. We always lag behind the rest of the country anyway. But will the pace slow down by 2018? You bet. I think we’ll lose many of our good ones to rising rents. Many others who want to open a new place, just won’t, choosing to bide their time until we get some crazy influx of people who want to work the line, or serve tourists in excruciating 12 hour shifts with a Time Tracking Software to make sure they work what they are supposed to.

To me the current state of the restaurant industry reeks a bit like the 1999 dot-com boom, or the 2005 real estate ridiculousness. It’s frenzied and frantic with everyones eyes gleaming with dreams of success.  The good news is, hindsight is 20/20, and generally out of those booms and busts, a stronger foundation arises, with far more sustainable practices.  In the meantime, I think I’ll enjoy the immense variety provided to me, and see about booking that coveted reservation at FIG.

tavern-and-table-mount-pleasant-sc

Tavern and Table opened 2014

 

Posted in Charleston Lifestyle | Tagged , , | 1 Comment

So how can a burned-out decrepit house be beautiful? I’ll show you.

Update on January 13, 2017 – It seems strange that I just wrote about this house a short while ago. Since then, structural engineers deemed it unsafe and endangering the homes surrounding it. So the City gave the owner permission to demolish it. Keep in mind – this almost NEVER EVER happens, particularly to such a notable historic property. I’ve seen crazy leaning homes in varying states of disrepair, and almost all are able to be saved. We’ll miss this beauty.  Check out the video below to see her coming down piece by piece. 🙁

 

Original post from December 1, 2016 ——————————————————-

4-Gadsden-Street

4 Gadsden Street

I pass by this bright pink house often. It is on my way home, and on my walk to the sunset bench. Years ago it was just a couple doors down from where I lived and I could often hear the students porch-sitting on the hot evenings, playing music, talking to their dogs.  Lucky them. Getting to live in that house – 12,000 square feet of history. All that changed when in May of 2014 it suffered a major electrical fire.

Blocks around it were closed down for quite some time, but fortunately only one of the 12 people there at the time was hurt.  The house did not fare so well with most of the interior burned to a crisp.

124-beaufain-charleston-sc-fire

Fire from Ashley and Beaufain

124-beaufain-fire2

View from Gadsden Street after the fire

It can take some time to get things done in Charleston, so there it sat for more than two years, with only small signs of construction and renovation. Some called it a monstrosity, an eyesore, some averted their eyes in fear. One could even claim that values of the homes in its surround were eroded, as no one wanted to look at that ugly house.

But I never ever ceased to believe in its beauty.  Why??

Because within its tattered walls lies the history of Charleston.

Built circa 1852, one of the owners was the person who built the Charleston jetties at the mouth of our Harbor – which have transformed our topography and economy to this day. In the architecture you see the many layers of hand-mortared bricks, you see the earthquake bolts and rods that were sold to all well-to-do Charleston homeowners after the devastating 1886 earthquake, in order to “prevent” their houses from falling down. And if you look closely in the stucco you see horizontal and vertical scores. These were made because the building style of the wealthy at the time incorporated huge pieces of stone carved from quarries nearby in places like Philadelphia and Boston. We don’t have quarries nearby so we made do with our little lines. And even the burned out pieces, after the home is completely restored, will still remain in some small part.

The story of the fire will become part of this homes extraordinary history, told through its walls and sticks and struts and bones – and that, to me, is beautiful.

So the next time you are riding around Downtown Charleston and you see something falling down, something askew and tattered – remember that it tells the story of us. The story of architecture, of its inhabitants, of its wars and natural disasters, fashions and necessity, and wealth and poverty. Respect its voice and respect its past, no matter what it may look like today.

And…..having said all that, I can’t help but be excited about the recent restoration activities on my beloved Pink House. Though I have seen countless buildings Downtown in varying states of undone and redone, I cannot remember EVER seeing anything like what’s going on in the rear of this home. Scroll down for all the photos.

View from Beaufain

View from Beaufain

4-Gadsden-Rear-View

View from Gadsden

4-Gadsden-Rear-View-2-Kristin-Walker

Rear View – WOW.

Posted in Charleston Architecture, Charleston Peninsula Real Estate | Tagged , , | 1 Comment

Is the Third Time a Charm for the Sword Gate House?

Sword Gares

Sword Gates

The allure of the Sword Gate house is real. A massive, magnificent mystery behind a towering brick wall, seen only through hand-wrought iron gates featuring two brawny swords. Who owns it? Only a few are privy – otherwise the rest of us are left wondering who in the world is Bear Gate Realty Limited – the name listed in the tax records. This Sword Gate mansion has just come on the market, listed for an easy $19,500,000 – the second highest price ever asked for a home in Downtown Charleston.

But this is not the first time this home has been offered for sale – it’s actually the third in the past decade with no sale yet recorded. So will this third time be a charm for the Sword Gate house?  Located at 32 Legare Street (pronounced Luh-gree), in the most exclusive area of historic Charleston South of Broad, the home has 9 bedrooms, 13 bathrooms, and 17, 142 square feet on a .87 acre private lot.  It was built in 1803, in the Federal style, during the time in which Charleston was the wealthiest city in our new hard-won nation.  Below is a bird’s eye view of this estate and for interior photos you can follow this Zillow link.

View of Sword Gate property

View of Sword Gate property

 

Handsome Properties, the current listing company, presents the Sword Gate house beautifully, in all its visual and historic glory, and they were able to gain coverage of it in Forbes Magazine. The article gives you great insight into the home’s storied past. (Though as an aside, I beg you please ignore the author’s comments about ‘Peninsular Charleston’ which he says means ‘the heart of the old, rich town’.  Actually, ‘Peninsular Charleston’ includes the area all the way up just past Mount Pleasant Street, about 3 miles from the Sword Gate house, and hosts quite a diversity of housing and people – not necessarily the ‘old’ and the ‘rich’.)

As usual, I digress.

So, here’s a listing history of the property – first offered right as the Great Recession settled in, so no wonder it languished on the market.

  • July 2009 – Offered by Disher, Hamrick and Myers for $23,000,000 (the highest price ever asked for a home in Charleston).  I actually wrote a post about this home then!
  • November 2011 – The home was withdrawn from the market.
  • December 2011 – The home was listed again for $23,000,000 with Daniel Ravenel Real Estate.  To note: in Charleston, December 2011 was generally regarded as the bottom of real estate prices, with the slow recovery beginning shortly thereafter.
  • December 2012 – Price change to $19,995,000
  • May 2013 – Price change to $18,800,000
  • December 2013 – The home was again withdrawn from the market.

But the times, they have changed in Charleston since 2009, 2011, and even 2013. Our economy is vibrant, and this town is a rising star in the eyes of well-heeled national and international buyers. Those seeking a private, historic, trophy estate in the heart of historic Charleston would do well to consider the Sword Gate house. The third time should be a charm!

For more history on this spectacular property, visit the National Historic Register

Preservation Society Plaque

Preservation Society Plaque

___________________________

Speaking of trophy properties, two others currently on the market include:

2 Concord Street for $8,850,000 – located right on the Charleston Harbor, a former Navy degaussing station with a main house, guest house and a deep water dock with a 100 foot floater. Perfect for a yacht owner. Listed with William Means Real Estate. I wrote about this property in 2011 when it first came on the market.

60 Montagu Street for $12,950,000 – a nearly 1.5 acre estate- also built during the Federal period like the Sword Gate house, with multiple buildings and a pool in Harleston Village. The owner, a delightful gentlemen and great neighbor, lovingly restored this property with extraordinary attention to detail. I had the opportunity to see the home when we went through the Master Preservationist Program together in 2011, and I can say with confidence, it is nothing short of mind blowing.  Listed with Handsome Properties.

 

Posted in Charleston Peninsula Real Estate, Luxe Life, South of Broad | Tagged , , , , | Leave a comment

An Insider Look at HARLESTON row | From Vision to Completion

If you have been a subscriber to this blog for more than a year, you may recall in August of 2015, I launched a huge new construction project I had been working on since December of 2013 with the incredible team of JJR Development, Dow Inc, and Architect Julia Martin – HARLESTON row.  HARLESTON row is a collection of six new luxury rowhomes in the heart of historic Harleston Village. Not only are they contemporary in design since the area context allowed for it, but also the homes incorporated what is the largest installation of private residential living roofs in Charleston, and possibly the state of South Carolina.

I am happy to say, that as of the beginning of August, HARLESTON row officially welcomed all of its new owners and the residences are complete! For a bird’s eye view of the project and some beautiful interior photos, check out video and other media below.

If you’d like to see some under construction photos, and learn more about the role I played in the two+ years of design and development, skip down to the bottom of this post.

Otherwise, without further ado, may I introduce HARLESTON row.

Harleston Row – A Modern Approach to Living in History from Kristin Walker on Vimeo.

Photos of HARLESTON row completed

Photos of HARLESTON row under construction (can you believe what you saw above used to look like this?)

How I was involved

I consider myself extremely fortunate to have been involved with this project for nearly three years. It was an incredible opportunity for me to work with an architecture and development team over time and see HARLESTON row come to fruition.  While typically real estate agents are known to list, market and sell a property, I got so deep inside this project, I was able to do much more.

  • Neighborhood Meetings – we introduced the project to the neighborhood at a little soiree, before any construction began.
  • Interior Finishes Selections – the architect and I worked hand in hand to select the interior finishes based on what was complementary to the architecture, level of luxury, and what we thought buyers would like (while pushing the envelope a little for traditional Charleston 😉 )
  • Brand Creation – coming up with the name, the colors, the fonts, the logo and more was of utmost importance to the project. It needed its inherent personality to be expressed!
  • Renderings – with any new construction project, beautiful renderings are key to helping buyers to envision the home. I had 3D renderings of the front, the living room, the kitchen and the living roof done, and it’s neat to see how similar to the final product they are!
  • Website Design – www.harlestonrow.com – communicating all the different aspects of the project, from floorplans, to pricing, to details on the living roof, was important to me and the team, as well as essential for potential buyers. So I designed the website to do just that.
  • Pre-sales Marketing
  • Public Relations
  • Advertising
  • Sales, Promotions and Showings
  • Site Visits 4-5 times per week
  • Team Meetings
  • On-going Buyer and Agent Communications – we felt it was important to keep our buyers and their agents updated as much as possible, so not only did I communicate individually, but also I tried to send out newsletter updates every 7-10 days with photos and descriptions of the construction progress.
  • Closings and Fulfillment
  • Media Production – professional photos and a drone video of the finished project were a must! I hope you enjoyed them.

HARLESTON row was such a significant part of my life for the past three years – I have to admit, I miss it. Though I can walk or ride by any day of the week, it was being a part of the creation of it that was so fulfilling.  What was once a dusty and cracked parking lot, has now become an exquisite part of Charleston’s urban fabric, with elements that hopefully will lead the way in sustainable, contemporary design.

Posted in Developments, Harleston Village | Tagged , , | Leave a comment

How much will you pay in Property Taxes in Charleston?

This is one of the most commonly asked questions by those of you who are thinking about moving to the Charleston Metro Area, or those of you who are moving from a rental in Charleston to your very first home!  Not only are you seeing all kinds of numbers that don’t make sense online, but also you are hearing things like “it’s 4% or 6%”, and take that to mean for a $500,000 home you’d be paying $20,000 or $30,000 annually. Right?? Not so. Not even close.

So let me shed some light on what you will pay in property taxes in Charleston County.

FIRST THING TO REMEMBER – the taxes you see online, or what someone currently pays, have absolutely NOTHING to do with what you will actually pay. 🙂  When you buy a house in Charleston, the taxes are then recalculated based on the sales price, and whether or not you are using it as a primary or secondary/investment home. Keep in mind taxes are paid in arrears here, so when you buy that house, you actually get a credit from the seller on the closing statement, because you’ll be paying the full bill when it comes due at the end of the year. If you are still just window shopping, it would serve you well to know how your scores are fairing, there are many sites that offer free credit scores that you can use to make sure you are in your league.

SECOND THING TO REMEMBER – Charleston County property taxes for primary home owners are some of the lowest in the country.  For second home/investment properties – not so. As matter of fact they are almost triple the primary home rate.

THIRD THING TO REMEMBER – Bookmark this link. It’s the Charleston County Handy Dandy Tax Estimator.

On to our examples…

Primary Home

If the home you buy in Charleston is your primary home, you benefit from a 4% tax rate, as long as you meet all the criteria for the 4% (application here).  So what will you pay?? First, take the sales price, multiply it by 4%, then multiply that by the millage rate (.2676 Downtown) and you have your base rate.  But then there are tax credits as well!

So rather than trying to figure it out on our own, let’s go back to the handy dandy tax calculator. Here’s a screenshot for a $500,000 primary home in Downtown Charleston (other areas are slightly less expensive).

primary home tax example

Primary Home Example

 

You will pay approximately $2582 annually!

 

Second/Vacation Home or Investment Property

The second home or investment property rate is higher at 6%, and you don’t benefit from the deductions.  So to estimate your taxes on your great ‘other’ place, take the sales price, multiplied by 6%, multiplied by the millage rate (.2676 Downtown) etc…etc… So here’s that same $500,000 home that you are using for a second home or a rental property.

Second/Investment Tax Example

Second/Investment Tax Example

 

You will pay approximately $7272 annually!  Now that’s a big difference isn’t it?

So, you won’t pay that same amount forever. Every few years the tax assessor comes out to reevaluate your property and the market, and your taxes will either go up a little or down a little depending on what they find. And there are limits to how much they can go up over time, but that’s a discussion for another day…

So, I hope that helps!  Of course, if you have any more detailed questions, please consult a tax accountant or attorney. 😉

 

Posted in Buyers | Tagged , , | Leave a comment

Tracking 10 Years of the Real Estate Market in Charleston

Every day I am asked the question – do you think we are in a real estate bubble? How much do you think values will rise over the next few years? Will there be a crash?? I wish I could have a magic looking glass, but I’ve been instructed never to make predictions. However, I can give you some key information and pretty graphs that will possibly help you decide the answer for yourself.  So let’s look at a couple important items, comparing 2006 to 2016, and then play with some charts tracking 10 years of the real estate market in Charleston.

The way I see it, two things are different between 2006 and 2016 – lending practices, and our local economy.

Loosey Goosey Lending

Back in 2006 all over the country, your hairdresser probably owned multiple ‘income’ properties, or was making bank flipping houses just because the market was frenzied and if you had a good credit score, you weren’t asked for much proof of income – so called ‘no-doc loans’.  This loose lending created a market in which everybody was buying houses, and there seemed to be no end to the skyrocketing prices, so you could always make a profit.  Too many people thus owned too many properties, so when the Great Recession hit, no one was buying anymore, but everyone wanted to sell. Obviously, this is a major simplification, but you know to what I am referring.

In 2016, there are no more ‘no-doc’ loans unless you are very wealthy with a long-standing relationship with your asset manager. Yes, lenders are a bit more flexible today than even two years ago, with new products that make it easier to write a loan, but the process is so detailed and excruciating, that even my father ditched the process of a refinance because they were asking for his first born (ME!).

Economic Drivers in Charleston

Charleston’s economy in 2006 was nowhere near what its economy is today. When I moved here from NYC in July of 2005, Charleston’s most significant economic driver was still tourism. The technology sector was in its nascent phase. Manufacturing was just huffing along. And yes we were growing in leaps and bounds, but the diversity of our economic foundation left much to be desired. Now obviously I can’t look at all the factors influencing our growth and success, but let’s look at three: Tourism, Aviation, and Technology.

Tourism/Hospitality – According to the Office of Tourism Analysis, in 2006, tourism had approximately a $3,000,000,000 impact on our economy. Today, we are nearing $4,000,000,000 – a more than 20% increase in a decade.  Just the Wine and Food Festival alone, started in 2006, today has a $9,000,000 impact. And let’s not even get started on all the new hotels and restaurants!

Aviation – Led by Boeing, which arrived in Charleston in 2011, the aviation sector in the metro area now has a $14,000,000,000 impact, – double the number of pre-Boeing, and today considered 40% of our local economy, providing 16% of our jobs.  Additionally, the number of people flying into Charleston International Airport has increased more than 50% in the past decade.

Technology – When I moved to Charleston in 2005, I worked for the Chamber of Commerce developing programs designed to help stimulate the growth of entrepreneurs in Charleston and statewide. I then moved to SC Launch!, which assisted technology entrepreneurs in gaining funding. Back then, there were fewer than 50 technology companies in Charleston – today there are more than 200. Here are some other interesting stats:

  • The Charleston Digital Corridor – a tech incubator (among other things), has gone from 40 members in 2005, to 121 in 2015 – and these companies cumulatively raised over $80,000,000 in funding this past year.
  • Technology companies in the metro area now employ over 11,000 people, and that number is expected to almost double in the next few years.
  • Charleston’s tech economy is growing 26% faster than the national average.

Companies like Automated Trading Desk (now owned by CitiGroup for the low price of $680,000,000), PureCar (purchased for $125,000,000), SPARC (purchased by Booz Allen Hamilton), PokitDok, PeopleMatter, and Good Done Great, Car Leasing from ICL , drive this economy forward, and have attracted big name companies for acquisitions and significant venture capital infusions – something that never would have happened in 2006.

And a few more things…

We now have more than 40 people per day moving to the Charleston Metro Area. Mount Pleasant’s population alone has increased by about 20% in the past decade. And here’s a link to the Charleston Regional Development Authority’s ‘Scorecard‘ showing some other impressive stats, including per capita income growth, exports, GRP, etc…

SO, have you absorbed all that?? Now, let’s look at 10 years of the real estate market in Charleston, so you can answer your burning questions yourselves. These little graphics are interactive so just use your mouse and click away!

Median Prices

Let’s start with Median Prices in the metro area (Charleston, Berkeley, Dorchester counties) to get a baseline. Remember, 2007 was considered the peak of prices in this area, 2011 was the trough.

Now let’s look at 3 different areas for comparison – Isle of Palms for a little island vibe, Downtown Charleston south of Hwy 17 for the urban, and Mount Pleasant South of the IOP Connector for the suburban.

Closed Sales

Now let’s look at Closed Sales – meaning the number of properties purchased in any given year.

Metro Area

Isle of Palms, Mount Pleasant, Downtown

Months Supply

And finally, let’s take a look at ‘Months Supply’, which indicates how many homes are for sale versus how many are purchased. 6 months is a balanced market – below that it is a Seller’s market, above it, it is a Buyer’s advantage.

Metro Area

Isle of Palms, Mount Pleasant, Downtown

So having looked at this data, I have a few comments. It’s interesting to me that the number of closed sales all over is LESS in 2016 than it was in 2006, yet we have had more than a 20% increase in population in the same time frame. I also note that there is very little inventory – so I assume demand is outweighing the supply. This imbalance is helping to drive the prices up in suburban areas like Mount Pleasant don’t you think? A 70% increase in median prices there from 2006 to 2016? No wonder people are calling bubble. (By the way, I have a theory that it was the opening of the Ravenel Bridge in Summer 2005 that led to Mount Pleasant’s explosive growth. Before that, no one wanted to drive over the scary Grace bridge!)

I’d say it doesn’t look bubbley in Downtown south of Hwy 17, or bubbley at all on the Islands. It just looks like a bubble, and may feel like a bubble in the lower price ranges, because we do not have enough houses to accommodate the demand, the population influx and our growing economy. There are many factors that contribute to that:

  1. Investors with cash buying up inexpensive houses leaving fewer for first time home buyers and people with average incomes.
  2. A tight local construction market in which demand for workers and products is far outpacing supply so prices to build are rising.
  3. Charleston’s natural geographic constraints. Unlike Atlanta or Charlotte (thank god!) we can only build out 180 degrees, and those degrees are further constrained by our marshes and waterways meandering throughout.
  4. Development and zoning restrictions.
  5. Traffic – the further out you build, the worse traffic gets and there’s only so much of a commute that human beings will tolerate.
  6. For big builders, there’s just more profit margin in building more expensive houses (see #2).

So Bubble Yes? Or Bubble No? And where do YOU think Charleston’s real estate market is going to go over the next 5 years?  I’d love to know.

Posted in Statistics | Tagged , | 1 Comment

Only the Pelicans are Enjoying Colonial Lake – A Renovation Update

It has been just over a year since the $5,000,000 renovation of Colonial Lake began, though it seems like eons. I miss the Lake, the people strolling around, the dogs, specially my dog who was like any other on their dog category. But that’s all been temporarily replaced by mudpits and mudpiles, fences, pounding, beeping, growling engines, and a constant film of dirt on my car.  However, lest you think I am complaining, I’ll say that the renovation is coming along swimmingly, and I am excited for the big reveal!

Right now, only the pelicans are enjoying our favorite Harleston Village park because over the past several days, they have drained the lake to do some work on the tunnel to the Ashley River that feeds Colonial Lake with water. I imagine there is quite a delectable selection of fish trapped in the shallow pond that is left.

colonial-lake-harleston-village-renovation

Pelicans diving in for lunch

Massive mud pile and pit

Massive mud pile and pit

When I spoke to a construction worker a month or so ago, he indicated he didn’t think the Lake would be done until August – a 6 month delay from the original timeframe. No surprise given all construction projects everywhere seem to be behind!

However, these photos I took in December will give you a much better idea of the beauty that is to come, whenever that may be.  You can see they have completed the tabby work on the walls, and raised the level of the Lake above where it used to be. In addition they have installed beautiful new brick seating walls, granite coping stones, and new curvaceous sidewalks.

For a complete plan of the renovation and lots of renderings or for the bathroom plans go to the Charleston Parks Conservancy site or the showerheadly site click these links below:

Or here is a quickie view courtesy of the Conservancy.

For some photos of what it used to look like and what it meant to me, check out my post from 2012 ‘For the Love of Colonial Lake’. Excerpt below…

For six years Colonial Lake has marked the rhythm of my life, constant and changing. It is the first thing I see when I get up in the morning and sip my steaming coffee, and the last thing I see before I lock the door, pull down the shades, and turn in for the night.  It is my sunrise and my sunset. It is my big sky country, where I can see stars and rainbows and full moons rising up over the colored roofs of this intimate city.

If you crave ‘big sky country’ too in the middle of Downtown Charleston, here’s the skinny on buying a place overlooking Colonial Lake.

  • There are approximately 30 homes facing the Lake – ranging in size from 1,200 to 7,000 square feet.
  • Two large condo buildings occupy two of the corners –  The Baker House and Berkeley Court. Only a handful of places in each one have Lake views.
  • Three historic homes are converted to multiple condos – all have Lake views.
  • And a college rental or two – we like the variety and spice of life – no? 🙂

There are two places with a big sky view on the market right now (

22-Rutledge-Ave-Charleston-SC

22 Rutledge

58-Rutledge-Ave-Charleston-SC

58 Rutledge

One of these days, some month soon, we’ll all be enjoying a cool beverage on our piazzas, gazing at one of the most spectacular parks in all of Charleston, the renovation construction just a blip in our lifetimes. But for now we’ll just let the pelicans have their fill…

Posted in Harleston Village, Urban Life | Tagged , | 2 Comments