Ignore the Masses, Part 318

Bill Lagan walked into my office on Friday, slapped June's Money Magazine down on my desk, and said, "You're gonna love this <expletive deleted>." I knew I was in for something good, since I usually don't have to censor anything Bill says.

Do you remember the Bugs Bunny cartoons from years ago? I'm thinking specifically of Yosemite Sam hopping mad, jumping up and down, his face beet red, smoke coming out of his ears, yelling, "Oooooh, I HATE that rabbit!"

That's exactly how I feel right now about the editors of Money Magazine. And it galls me to think of how many of their readers will just accept what they write as excellent advice - and subsequently lose money because of it.

A few examples:

1. They quote a California-based economist who answered the question, "How will people know when it's okay to get back in(to the real estate market)?" His answer? "Simple. When prices stop falling for six months." Silly wabbit. His comments may hold true for California, but when it comes to Myrtle Beach real estate, wait six months and all of the great deals will be gone, interest rates will have risen another 50 to 100 basis points, and the Trumps and Buffets will be finished stuffing their real estate portfolios with home runs.

2. How about this zinger? "Face it: The house you buy today will more than likely be worth less next year." If this smackdown doesn't make the reader run screaming from a purchase, the writer's advice to ignore the seller's asking price and bid 10% below what comparable homes are selling for" sounds great but ignores the basic premise of buying the right home, as opposed to the best-priced home.

3. OK, more agent-bashing: "The real estate game has a built-in conflict of interest, since the listing agent and your agent both get paid by the seller." Are we really going to debate the value of real estate agents again? In what could be the biggest financial transaction of your adult life, would you rather go it alone or have the knowledge and advice of a professional who does this all the time? True, the seller pays the commission, but nobody gets paid until you find the perfect house and negotiate a 100% acceptable deal. If you're a serious buyer, using a buyer's agent (at the seller's expense) to help search, negotiate and advise just makes good sense.

4. "Up until now, you couldn't really operate in the residential real estate market without access to the National Association of Realtors' multiple-listing service. The monopoly meant that only realtors really knew what homes in your area were selling for. They'd be happy to share the data - in return for the standard 6% commission." Sorry, Money. Each of these three sentences is factually inaccurate. First, there has never been, and never will be, a national multiple listing service. All real estate is local, and the multiple listing services are, too. There is no monopoly. You can research the Myrtle Beach real estate market on our website as well as hundreds of others. You can search a wider area on realtor.com. Want to know what houses are selling for? There are numerous sources for this information - all of them free. And as for that "standard" 6% commission, well, now that's illegal. All commissions are negotiable, and shame on you for suggesting otherwise.

I could go on, but I've come to the conclusion that Money Magazine might best serve their readers by sticking to what it does best: continue recommend the good ol' stock market with its spectacular returns.
Hey, Money editors! With friends like you, who needs the rest of the national media?

- Richard Sander, P&C Sales Mgr

Our Top Three Real Estate Negotiation Strategies Right Now

Let's agree right away that every transaction is unique and probably much more complex than any of the strategies I present here today. But how can you position yourself - whether as buyer, seller, buyer's agent or seller's agent - to be dealing from a position of strength? Here are our top three winning negotiation strategies for the Myrtle Beach real estate market right now:

1. Market Expertise. Forget what the national media says about real estate. What's the state of the Myrtle Beach market right now? Today? This week? The more information you have about what's selling, what isn't selling, where and why, the better positioned you'll be to take advantage of even small fluctuations in the market. Having a well-connected real estate professional in your corner can be to your advantage.

2. Where Is The Leverage? Let's be honest. If you're a seller in the midst of a buyer's market, and your home has been on the market for months, and you aren't the lowest-priced home in the area, you have no leverage! If, however, you are the seller evaluating offers from three buyers on your spectacular house that's priced right, you have the luxury of picking the best offer - or negotiating with all of them!

If you're a seller in a buyer's market, however, all hope is not lost. You can, for example, improve your home's curb appeal, or present a potential buyer with an inspector's report. An experienced real estate professional can make recommendations like these to improve your home's desirability, make it stand out from the competition, and even justify a higher price. Your Realtor can also represent your home in an unemotional way that could wind up saving you thousands of dollars in the end.

3. Look Beneath The Hood. Price is not always the sole determining factor. Consider two identical homes, in the same neighborhood, that have sold for $155,000. One sold at that price with no concessions from the seller. The other seller agreed to replace the air conditioning unit, paint the downstairs, and cover the first $2,000 of the buyer's closing costs.

If you're the buyer, which deal would you prefer? Do you know how to negotiate these items and a dozen more? (Hint: we do.) If you're the seller, how do you get closer to making no concessions? (Hint: we know.)

These are our top three right now. Keep in mind that we haven't even touched on sellers negotiating only with pre-approved buyers, or with unrepresented buyers or sellers. And an experienced Realtor knows how to leverage these - and many more - to your advantage.

All you have to do is ask for our help!

- Richard Sander, P&C Sales Mgr

Alice's Restaurant is Coming to Myrtle Beach!

Remember Alice's Restaurant? Back in the 1960's, it was a wildly popular song, then turned into a movie. Pretty soon, you'll be able to actually get a table at the famed "Alice's Restaurant" when it opens at Hard Rock Park.

Folk legend Arlo Guthrie stopped in last week to see how things were going, as the restuarant continues to take shape.

Hard Rock Park - committed to celebrating the spirit of rock ‘n' roll - is the perfect venue to honor Guthrie and his world-famous 18 minute long musical monologue. The restaurant will be park's only table-service restaurant ("sit down, sit in, you've got time"), offerring guests props and reminders of Thanksgiving Day 1965, including the "Group W Bench" and what will be the most popular table in the house: the reservations-only Arlo Table, a psychedelic trip featuring 60 artists that influenced Guthrie, or were influenced by him.

Surrounded by acoustic and folk music from the last four decades, the comfort food menu (created in part by Guthrie himself) will offer a complete selection of entrees, soups, salads and, of course, desserts. Many have names that will bring back memories, including Officer Obie's Pan Fried Pork Chops to the inevitable Thanksgiving Dinner. "It is an attraction in its own right," said Steven Goodwin, Hard Rock Park's CEO.

- Richard Sander, P&C Sales Mgr

Warm Weather To-Do List

As it gets warmer outside, make sure that your home's expenses don't make you hot under the collar. Here are our top ideas for this month:

1. If you live in a humid climate, and there are areas of your home that aren't air-conditioned, make sure that you have a dehumidifier installed in those areas, and that it is working properly.

2. If you have any window unit air conditioners, make sure there is no air leakage around them (caulk if necessary) and that they are operating properly. Install a clean air filter (or simply vacuum clean the existing one to save money).

3. Closely examine your deck for signs of deterioration. Tighten screws and railing bolts, and hammer down any exposed nails. Clean and reseal wood surfaces. Also check patio furniture for rust. Scrub rusted areas with a wire brush, then prime and paint. A small amount of time invested here will pay off in the long term.

4. Check and repair weather stripping and caulking. Gaps around your doors and windows inflate energy bills. If you can see light, imagine a giant sucking sound - that's money escaping unnecessarily.

Do you have other ideas for this month? Post them here!

- Richard Sander, P&C Sales Manager

South Carolina Wants Teachers!

Everyone agrees that South Carolina needs more teachers, but now the state is doing what it can to lure new teachers here with generous housing assistance.

The state Housing Authority is making $20 million available for home loans to new teachers. This works out to be approximately 175 new loans (i.e., new teachers) this year, which will feature a 5.9% interest rate and up to $7,000 in down payment assistance (including the possibility of not having to pay the down payment back). Loan amounts of up to $240,000 are available from more than 200 South Carolina lenders.

Price & Company Realty knows a little somthing about teachers. Just ask our very own Bill Lagan!

- Richard Sander, P&C Sales Manager

Myrtle Beach continues to grow!

Census Bureau data released last week show that Myrtle Beach continues to outpace most metropolitan areas in growth - despite the gloom and doom perpetuated by our friends in the national media.

The fastest-growing areas in the United States are in the Sunbelt. Experts credit much of the growth in the South to strong local economies and housing prices that are the most affordable in the United States.

The ten fastest-growing metro areas in the country are:

1. Palm Coast, Fla.: 7.2 percent
2. St. George, Utah: 5.1 percent
3. Raleigh-Cary, N.C.: 4.7 percent
4. Gainesville, Ga.: 4.5 percent
5. Austin-Round Rock, Texas: 4.3 percent
6. Myrtle Beach-Conway-North Myrtle Beach, S.C.: 4.2 percent
7. Charlotte-Gastonia-Concord, N.C.-S.C.: 4.2 percent
8. New Orleans-Metairie-Kenner, La.: 4 percent
9. Grand Junction, Colo.: 3.7 percent
10. Clarksville, Tenn.-Ky.: 3.7 percent

- Richard Sander, P&C Sales Manager

IRS Decision Helps Myrtle Beach Real Estate

As one of the most popular vacation-home markets, Myrtle Beach real estate investors will benefit from a recently-issued IRS document...

It used to be that nobody was really sure whether a vacation home would qualify as "investment property" under IRS rules governing §1031 tax-deferred exchanges. But, last month the IRS completely eliminated that uncertainty by clarifying under what circumstances one of the most popular forms of Myrtle Beach real estate - your vacation home - will be considered "held for investment" and qualify for a tax-deferred exchange.

If you already own a vacation home in Myrtle Beach, you must have owned the property for at least two years immediately preceeding the exchange (the "qualifying use period") and in each of the two twelve-month periods, you must have rented out the home for at least 14 days or more, at fair value, and your personal use must have been less than the number of days rented.

If you are considering purchasing Myrtle Beach real estate as a vacation home using tax-deferred exchange funds, you must own the home for at least two years after closing (the "qualifying use period") and within each of the 12-month periods, you must rent the home for at least 14 days or more, at fair value, and your personal use must be less than the greater of (1) 14 days, or (2) 10 percent of the number of days that your home was rented out. In other words, if you rent the property for 30 days, you can still use it for 14 days yourself, but if you rent it for 200 days, you can use it for up to 20 days without the IRS batting an eyelash.

As always, don't take my word for it. Consult with your tax professional before using the IRS tax code to your benefit!

-Richard Sander, Price & Company Sales Manager

Insurance Costs Finally Come Back Down to Earth

We received an email this morning from an owner of a condo in a waterway community here in Myrtle Beach. He, and this community, were hit especially hard by the insurance premium hikes after Hurricane Katrina.  His HOA announced insurance rates for 2008 and he was kind enough to share the numbers with us. The difference was as dramatic as it was expected... and you can hear a big sigh of relief from Myrtle Beach real estate owners and investors alike. Take a look:

" ...received competitive bids from three carriers and we selected the one with the best coverage for the dollar. The new policy cost is $163,037, which represents a significant savings from our 2007 policy cost of $360,000 and a huge savings from the $917,000 policy that we had in 2006."

 

-Richard Sander, P&C Sales Manager

The Hard Rock Park is Open! But...

The long-awaited Hard Rock Park has finally opened. As Myrtle Beach's first full-scale theme park, excitement is high and the park expects to draw more than 40,000 visitors each day. It's sure to make the top five list of what to do in Myrtle Beach for many returning and new visitors to this beachfront town.

But there is another option in Myrtle Beach that should not be forgotten with all of the hoopla surrounding the "New Kid" in town. Our area is also home to a seaside gem, Family Kingdom.

More than 40 years ago, when Family Kingdom was built, seaside amusement parks were commonplace and virtually every beachfront resort town from Maine to Florida had one. But today there are fewer than twenty oceanside parks along the entire East Coast, making Family Kingdom all the more special. Its oceanfront location is unique; its wholesome atmosphere is appealing to families, and its status as Trip Advisor's "#5 Amusement Park" in the country (outside Orlando) distinguishes it from all other coastal attractions between Virginia and Florida.

Family Kingdom offers attractions that parents will remember well, and that today's kids should absolutely experience: the legendary Swamp Fox wooden roller coaster, the largest Ferris wheel in the state of South Carolina, and more than thirty other rides and attractions. It offers a complete amusement park experience with midway games, family entertainment and traditional park temptations such as funnel cakes, cotton candy and corndogs.

For some, Hard Rock's $50 admission fee will be hard to swallow. Family Kingdom's "no general admission" is a budget-friendly policy that enables families to stroll the midway affordably, buying tickets by the ride or purchasing unlimited-ride wristbands.

Family Kingdom is taking advantage of Hard Rock's opening by using a new tagline for this summer: "Nothing Rocks Like Family!" Now, now. We say that there's room in this town for both of you!

Visit them both at Hard Rock Park and Family Kingdom.

- Richard Sander, P&C Sales Manager

Southern Living Says Myrtle Beach is Second Only to Disney World...

Southern Living says Myrtle Beach is second only to Disney World as region's most popular family destination!

Time to make more room in the award storage cabinet.

Southern Living's annual Readers' Choice Awards, which reflect the view of the magazine's 47,000 readers, announced for 2008 that Myrtle Beach is second only to Walt Disney World as a family vacation destination.

This just confirms what those of you who are lucky enough to vacation here with kids already know... and why the Myrtle Beach real estate market is poised for a spectacular rebound once the media moves on to a new whipping boy.

- Richard Sander, P&C Sales Manager