Greetings from the Golden Isles! I know that this economic update for this area is earlier than you expected but with so much negativism in the National Media over the past week I thought that I would look at what has happen year to date and over the past quarter in the Golden Isles and report to you. Although I am no economic guru nor do I have the ability to see into some magic crystal ball that allows me to make economic predictions.... Hey... some days I have trouble seeing beyond my nose. But seriously I believe that information is the answer for those of you who are wondering what to do regarding your Real Estate needs during this time of economic uncertainty. So below you'll find my modest attempt at providing you with real information about here in the Golden Isles.
In beginning my search for trends I thought it would be prudent to look into the local lending arena. In doing so I checked several sources locally and nationally. Believe or not they all reported basically the same thing. That being there is more than adequate money available for QUALIFIED buyers. My probe also revealed interest rates were NOT sky rocketing into uncharted universes. Far from it I found rates to be well within the reasonable range from 6.70% to 7.85%. Variance in rate seems to be dictated by the type of loan as well as the credit worthiness of the borrower (nothing new there). The primary issue seems to be who will be given access to the plentiful money. In a nut shell anyone that has money to put into a property that has a solid credit history and a debt to income ratio below 37% (You have to have breathing room). So those who are walking the line may be required to have more money than those who are will within the limits! Hmm... sounds like I am at odds with the national media, perhaps so but hey I'm just reporting what is happening here in the Golden Isles.
Next you'll find a brief overview of the statistical information available to each and every Realtor in The Golden Isles closing with my interpretation of that information. To begin with let's look at Single Family Residential Sales for the past quarter and year to date. At this time November 2007 there are currently 1539 Single Family Residences on the market which is roughly a 12 month supply. Add to that an additional 470 condominiums /townhouses and one can readily see we're loaded with inventory. Continuing to look at the gross statistics we find that residential sales are down 41%, while days on market have increased by 5.5% to an average of 164 days. In response to the increase in days to sell asking and selling prices have decreased by 6% resulting in nearly a 3 % reduction in accepted selling price. Land sales appear to be retaining their strength in dollar amount; volume is off by 60% which came from a decrease in sales of developed land. But this trend it primarily due to the significant decrease in new developments which entered the market in 2006.
Next I've looked at the market as related to Saint Simons Island vs. Glynn County /Brunswick excluding Brantley, Ware, Wayne, Bryan, McIntosh & Camden Counties as well as Jekyll Island. I excluded these from this comparison simply due to the fact that the majority of reported sales occur in Glynn County (Mainland)/Brunswick and Saint Simons Island and I am simply curious about that dynamic. Overall single family residential sales are down year to date for the Mainland (as identified) and Saint Simons by 32.2%. Breaking this down even further you find that the down turn on Saint Simons is 30.5% whereas on the mainland it is off 22.9%. But here comes a conundrum when one looks at the third quarter exclusively one finds that "the mainland " as previously defined shows a significant increase of 10.66% whereas Saint Simons reflects a continued down turn of 34%. Further dissection of the numbers reveals that the majority of sales are coming from the homes in the $120,000 to $299,900 range with the highest frequency in the $200,000 to $299,999 range. The overall income demographic for this area would tend to support this fact in relation to the income range of those moving into and up in this area.
In conclusion it is my considered opinion that at this time we will continue to see a decrease in selling prices on Saint Simons Island due to the apparent over abundance of properties which are over priced by at least an additional 10+%. The market on the mainland appears to be growing in the under $299,999 range with the highest concentration of sales occurring in the $200,000 to $299,999 area. The only problem here is that due to the perceived down turn builders are not building spec housing in this range so expect a shortage in this range to occur during the second quarter of 2008.Land values are fairly stable and supplies are dwindling meaning negotiations will become more difficult as sellers hold firm on pricing in this diminishing commodity. Those of you who wish to obtain waterfront or marsh view properties are not going to find any bargains with these type properties for the same reason as with undeveloped land. That being availability which remains limited. Monies from local lenders are readily available for first time buyers as well as seasoned buyers with stable credit. Credit scores will need to be good and debt to income ratios will have to be under the 37% cap placed on Loan to value ratios. In short the market in the Golden Isles continues to out perform the national trend. Yes, there certainly has been some change but not to the extent projected by the media. Our market appears to headed towards a turn around in mid priced housing. However, upper end (above $300,000) housing will continue to be slow which may result in some buying opportunities for those who are liquid.