With all the talk about whether the market is bottoming out, I thought I'd take a look at the numbers and see what they say. But I'm sure that you're tired of the same old market reports so I've decided to take a different look at the Hilton Head Real Estate market. But to do that we have to look at the standard stats to get an idea of what the home market looks like to today compared to previous years.
The first graph a simple look at the numbers of homes sold on Hilton Head Island (including Daufuskie Island) in the 12 month period ending on April 30th. Looking back, in terms of number of homes sold, the top of the market looks like it was somewhere in in 2004-2005.
This next graph show the median sales price for homes on Hilton Head Island during same time period. Oddly enough, while the number of homes sold peaked in the 2004-2005, the median price seems to have peaked in 2007-2008. That is nearly a 3 year "lag" as the market adjusted from a sellers market to a buyers market. So is it safe to say that the same sort of lag will happen as the market bottoms out and the pendulum begins to swing back in the seller's favor? Maybe - but as the rebound has been slower than the decline, the lag time as seen above may also take longer too.
During this research, I also wanted to found out what the prototypical Hilton Head Island home being purchased and here is a general profile from last 12 months:
- between 2700 and 3000 sqft
Oddly enough, of the 794 homes listed on Hilton Head Island, only 45 fit the criteria set above*. To me that says 2 things. First is the wide range of home available on Hilton Head Island. Secondly, in specific ranges, there is not a lot of active inventory.
*as of May 17, 2012
Wondering what homes fit this criteria? Check out the search below. If you're in the market for a home that fits the description above, you can spend just a shade under $1,000,000 or a shade over $400,000.
The take home message here is that despite the continued and overall weakness in the market (but compared to 2004-2005 any market would seem weak), some particular markets like the one highlighted in this post are not that deep and the inventory that is well-priced is still selling at a relatively normal rate.
If you have any questions comment about this post, use the comment section below or shoot us a question on our Facebook page.
Port Royal Plantation has a new group for property owners to join, it's called the Fish Haul Farmers. Named after one of the most breathtaking tidal creeks on the Hilton Head Island, Fish Haul Creek. It is this estuary that feeds Miller's Pond, known by many as the best fishing spot in Port Royal. Along the banks of this tidal marsh, and just next to the Tennis Courts you will find the new Fish Haul Farmers tending to their plots already sprouting vegetables! Property owners are eligible to rent a plot, water and fencing are provided. Sunshine and great growing weather in a stunning location with marsh breezes adds another lifestyle dimension to living in Port Royal Plantation!
Originally from Pittsburgh, Pa., David moved to Hilton Head Island in 1986. Over the past 26 years David has achieved great success in real estate as well as working to enhance the community where we all live and work. In his long history of top producing real estate sales, David has helped hundreds of property owners with their real estate needs. His proven track record coupled with the resources and history of Charter One Realty creates a win/win situation. Read more about David here.
Walking the beach along Port Royal Plantation these days is kind of a surreal experience. 1,000,000, yes 1 MILLION, cubic yards of new sand has been placed upon an approximately one mile stretch of beach from the Westin to the Port Royal Beach Club! This past weekend while biking along the shore as the tide was going out, I was amazed to see the vast difference in the beach. Just past the Beach Club there is a 700' boulder 'groin' being completed. This rock wall is low crested and will be mostly buried when completed. As you look from the new shoreline back to the Oceanfront Homes in Port Royal Plantation, you'll feel like you are about half way to Spain, plus the height of the new sand is the same as the dunes. It's truly amazing. The cost was also, just under $10 Million (EZ Math says that's about $10.00 per cubic yard of sand, my goodness, that's a $10 million mile!). What will this renourishment and the amount of dollars spent to enhance the beach along do for property values in Port Royal Plantation?
Originally from Pittsburgh, Pa., David moved to Hilton Head Island in 1986. Over the past 26 years David has achieved great success in real estate as well as working to enhance the community where we all live and work. In his long history of top producing real estate sales, David has helped hundreds of property owners with their real estate needs. His proven track record coupled with the resources and history of Charter One Realty creates a win/win situation. Read more about David here.
Well, it is at least the largest Yard Sale on Hilton Head Island. The sale is located at the Hilton Head High School, just outside the gates to Hilton Head Plantation on the north end of Hilton Head Island.
This is a very fun Island event. I have personally attended the event for the past 4 years. There are always dozens of booths and vendors with thousands of items to peruse. This event always brings out some of the area’s most colorful residents.
With the state of the current and recent economy, this year should prove to be a big sale and there should be some really good items. Yard Sales across the nation have seen a big boost as of late, and this one should be no different. So if you like to wheel and deal March 31st is “the” day to mark on your calendar. Make sure to show up early, the line to get in and get the best deals starts very early and parking gets very limited very quickly.
- The sale is presented by the Hilton Head Island High School and The Island Packet.
- Start time is 9am sharp until 1pm on March 31st, 2012
- Street address is 70 Wilborn Road, Hilton Head
- If you want a booth of your own they are $55.00 dollars for a 9 x 12 spot, the size of one parking space.
- There will be an event directory that you may utilize to let the public know what types of treasures your spot will hold.
- You may share a booth if you have a friend or neighbor that wants a portion.
- You will be able to sell most anything.
- A few prohibited items are: Firearms, Food or Drinks, Animals, any Illegal items.
- If you want to sign up for a space call, The Hilton Head High School at (843) 689 4811.
- Space is not unlimited so sign up early.
- Yard Sale Sign Up (Click to Download)
- Directions to Yard Sale (Click to Download)
The graph below, which you may download, shows what effect the Heritage has on Hilton Head Plantation's real estate sales. Historically 2 weeks before The Heritage are the most active resale period for the entire year here on Hilton Head. What does this mean for Hilton Head Plantation Owners? If you want to sell your home, whether it is currently on the market or not, your best chance to sell for the entire year is rapidly approaching. If your home is not on the market, it is in your best interest to get it listed quickly and at the correct price. If your home is on the market and you are not getting the activity that you think you should be getting, reevaluate your home’s pricing and condition, make the adjustments, and give yourself a chance to receive an offer.
On the flip side, if you are a buyer and you are coming down for Heritage, arrive early and purchase early. If you wait until Heritage week, April 9-15, then you might be too late. Historical data shows that the early bird get the worm when it comes to real estate on Hilton Head especially during or around The Heritage Classic buying season. One good example is the "brown spot theory". This is a very scientific study that has been tested over decades, according to one of our top agents here at Charter One. Here is how it goes: When bananas come in at the local grocery store the inventory is naturally plentiful and all of the bananas are pristine and beginning to ripen, no spots. As the week progresses and shoppers take away inventory the supply gets to be less and less as the best bananas are purchased first. By the end of the week all that is left are the bananas that are over ripe (a leftover listing) with brown spots all over them. Nobody wants bananas with brown spots, so don't wait when the inventory here in Hilton Head is ripe for the picking.
docs/HHP Study - Harrison.pdf
Below is a chart showing the number of homes to sale in 2011 by price range. Real estate is a commodity that depends upon demand and supply. The more supply then means less demand.
When there is 6 months of inventory the home prices stabilize. The more months of inventory beyond 6 months, the more downward pressure on prices. When you look at the amount of inventory beyond 6 months you will see that this is still downward pressure. A good sign is that in 2009 we had 30 months of Island inventory and today most price categories show 11-12 months. The upper end – above $ 1 MILLION.
For example, in 2005 Hilton Head Island experienced a period of time ( late spring / early summer) when there were only 500 homes listed in MLS and the market was absorbing ( selling ) 101 homes per month. We experienced the highest degree of appreciation in our history. After the gradual and then steep downturn in 2008 our market was selling only 44 homes per month in 2009. Note the charts below showing number of sales per month. You will see that after 2009 we have seen increases in homes per month each year. Second chart shows sales by price range. This shows the months of inventory as of 12/31/2011.
Situated right inside of the Cypress 
Gate of Hilton Head Plantation is a hidden gem of Hilton Head Island. The Club is located in a supremely convenient location near the Skull Creek Marina and the proximity to the back gate to Hilton Head Plantation makes access quick and easy.
This particular club has always impressed me with its constant flow of Golfers, Tennis Players, and its overall appeal. I don’t think there is a better club on the entire Island. Sure if you want to pay over 10k per year you can acquire access to a more exclusive club, but it will not be any better than good ole Country Club of Hilton Head.
From a real estate standpoint, there are several areas near the club that offer a Villa/Condo option or Single Family Homes with great water and marina views.
Hilton Head Plantation
What makes a plantation special on Hilton Head Island? There are many things that differentiate one plantation on Hilton Head Island from the next. There is one thing, however, that really sets a particular plantation apart from “every” other plantation on our great little island. Hilton Head Plantation is the proud owner of the “only private beach" on the entire island of Hilton Head.
Hilton Head Plantation is one of the most well rounded plantations on Hilton Head. I think most people would agree with that statement. Sea Pines is great, Palmetto Dunes is great, but they don’t have what Hilton Head Plantation has.
What does it mean to have access to a private beach within the gates of the second largest Plantation on Hilton Head? If you like nature, water, and picturesque views, it means everything. Not to mention the powers that be at the Property Owners Association has already started the $200,000.00 plus renourishment project to keep Pine Island pristine and open to all of Hilton Head Plantation's residents.
I was there yesterday, the 24th of January, taking a walk with my wife and it struck me. This is one of the best amenities that any place in the Low Country can offer. The weather was great, I think it was about 65 degrees at 5:30pm; there were several of my neighbors walking their dogs, playing with grandchildren, and generally relaxing. The occasional boat would come puttering by and there were dolphins feeding right off shore from the point.
This photo is taken about ¼ of a mile from the beginning of Pine Island. The Live Oaks in the background are hiding the Dolphin Head Park from view. Dolphin Head has basketball courts a playground for kids, several areas to sit and soak up the vistas, and the far side has a walking trail that skirts the Port Royal Sound. The shore fishing is great from Pine Island and you can fish year round, not rules against it like the public beaches.
Have you ever heard of the 6 month line in real estate? It is traditionally recognized as the point where the number of qualified buyers equals the number of sellers in a particular market. Simply put - when there is a 6 month inventory of available homes on the market, home prices should, theoretically, be stable in a balanced market.
When there is LESS than a 6 month supply of homes, there is a seller's market and prices in this type of market typically rise.
At one point, according to Charles Sampson, Realtor and one of the partners of Charter One Realty's North office, there was a moment in 2005 that inventory had reached zero "0" in some market segments on Hilton Head Island, SC. And, as you can imagine, prices increased at a precarious rate.
On the other hand, when there is MORE than a 6 month inventory of homes you have what is called a buyer's market, a situation many of the real estate markets across the country are in today and the Hilton Head Island area is no different.
As one looks at the years following the popping of the real estate bubble, it is easy to see just how much the inventory of homes on Hilton Head Island has effected price. In April of 2009, on Hilton Head Island there was a 28 month inventory (nearly 5 times that of a balanced market!). At that point, the average home price was $828,153. Twelve months later, inventory was down to 18 months and the average price of homes was down to $716,958 - a 13% decrease, over 1% a month.
Fast forward to April 2011. Inventory levels were now down to 15 months, while the average price of a home on Hilton Head Island was $647,726 - a little over an 8% decrease from the previous year. Still a decline, but one that seemed to be slowing.
As of December 5, 2011, there is a 13 month inventory of homes on Hilton Head Island. And the average price? $645,096. Where will we be by April 2012? We may see, for the first time in a long while, single digit inventory levels. If that is the case, the decline in pricing will continue to slow. The hammer may then start to be passed from buyer to seller. Stay tuned - whatever 2012 brings, it is bound not to be boring. Or should we hope for "boring" yet stable market?
Tax time is here again, and for those who purchased in 2010, this is your opportunity to appeal. Your appeal must be filed by the end of 2011. The good news is that even if you purchased in 2008 or 2009 you can still appeal. Like the 2010 purchaser, the 2008 and 2009 appeals may only appeal with transfers that occur in the year of purchase and no transactions after the year of purchase may be used as a basis. Unfortunately, if the property was acquired before January of 2008 the chance of a successful appeal is minimized. Realtors ® did make some positive strides in 2011 to change the 2006 Point of Sale tax code but the change only benefits 2011 purchases and only those assessed at the 6% rate or commercial properties. In a nutshell, if the property had been acquired after 2002, the chance of benefiting by this law is minimized because the purchase price less 25% cannot be below the property’s Fair Market Value of record.
The question of should you file still remains. If you win an appeal, you will enjoy the reduction for taxes in 2011and 2012. All properties values will be reassessed by the County after December 31, 2012. While our real estate taxes are a bargain compared to many states, only those who can’t claim residency, hold the property as an investment, and all vacant sites have the best opportunity to succeed in the appeal process because they are assessed using a 6% ratio. Essentially, if your purchase price is well above like properties, you should file and soon. The appeal form is simple to prepare and can be found at below. While the owner can prepare the form, the difficulty is in presenting, in a logical and convincing manner, the basis for the appeal or why you believe your property has been overvalued. Given the lack of like sales this can be a difficult task even for an Appraiser. Of course, I recommend an appraisal as the best method to present a logical appeal. Remember, the Assessor’s Office is staffed by Appraisers, licensed by the state, and are most familiar with the logical approach to value utilized in a formal appraisal. The cost of an appraisal cannot, by law, be based on the value established in the report but as a guide you can expect to pay between $450 and $550 for properties that are valued under $700,000.
Finally, you have three opportunities or levels in the appeal process. Only the property owner, and those hired to represent the owner, limited to an Attorney or Appraiser, may participate in the appeal process before the County Assessor’s office.
Bruce Goff, the author and local Appraiser since 1988, can be contacted at bruce@brucegoffhhi.com or 843.686.4444.
Bruce A. Goff, Owner Bruce A. Goff, Inc.
PO Box 4652 / Hilton Head Island, SC 29938
SC Professional Appraisers Coalition, Board/Past Chairman
SC State Certified Residential Real Estate Appraiser, CR29
Licensed SC Real Estate Broker / SC Real Estate & Appraiser Instructor
Voice: (843) 686-4444 / Cell: (843) 683-4444 / Fax: (843) 686-4858
Website: www.brucegoffhhi.com / Email:brucegoffhhi@yahoo.com