June Sales in Charleston

June was a great month. We had been about 35% off the number of transactions from 2008 before June. After June, we are only 29% off. That's a lot of ground to make up in one month. Price is still down about 15%. As I noted in an earlier blog, ratified contracts are only off about 10%. And I foresee that the second half of 2009 has to be better than the dismal second half of 2008. Ratified contracts may end up being about equal versus 2008 by the end of the year. However, price should continue to go down. Supply and demand still works and we have way too much supply. Price will continue to go down until we get some of this inventory off the market. As prices go down further, it will be more and more difficult to get a deal to appraise at the contract price. We are already seeing lots of problems with this. The lesson to be learned is that you need to price the home correctly to begin with. Time is not on your side. To get the most money for your home in a declining market, you need to sell it as quickly as possible. It will only be worth less a few months from now. Furthermore, if you overprice it and someone actually buys it and it doesn't appraise, you've just wasted a lot of time. And more so than ever, time is money. Jackie and I have sold 16 homes in less than 30 days for 96% of the list price over the last 2 difficult years. That is just a remarkable statistic. No other realtor can claim anything near that.

Market Activity

The number of buyers out there is almost as good as last year. Here is a number to support that: while sales are off 35% versus 2008, contingents(properties going under contract) are only off about 10%. Why the drastic difference? You would think that the two numbers should be almost equal. This large difference shows how much more difficult it is to get a ratified contract to closing. Banks are causing fall throughs due to financing and appraisals. The appraisers seem scared to death. Also, there are a lot more contingents that are short sales. They may not be closing for several months because of the nature of short sales. Again, it is a problem with the banks. They don't want to do a short sale, even though they should prefer it to a foreclosure. So, they drag their feet hoping the owner will come up with the payments.