Thirteen real estate market areas have more than a 50 percent chance of falling house prices within two years, and eight of those areas are in California, three are in Massachusetts, one is in New York and one is in New Jersey, according to a quarterly report by PMI Mortgage Insurance Co., a subsidiary of The PMI Group Inc.

Twenty-five metropolitan areas had increasing risk of price declines, compared to the previous quarter, while 20 had decreased risk, the PMI U.S. Market Risk Index also revealed.

High risk coastal markets

“Certainly the coastal markets have been the highest-risk markets pretty consistently, said Beth Haiken, a PMI Group spokeswoman. Some markets in Florida and the Washington, D.C., area have gradually climbed on the risk index list, she noted.

Price appreciation from first-quarter 2005 to first-quarter 2006 has dropped into the single digits for three of the 10 top high-risk markets, including San Diego, 7.7 percent; Boston, 5.7 percent; and Providence, R.I., 9.5 percent.

For the previous quarterly index, Boston was the only market area with that distinction, Haiken said.

Those major real estate markets at the greatest risk of a price decline, according to the index, are San Diego-Carlsbad-San Marcos, Calif.; Nassau-Suffolk, N.Y.; Boston-Quincy, Mass.; Santa Ana-Anaheim-Irvine, Calif.; and Sacramento-Arden-Arcade-Roseville, Calif.

Sacramento made its appearance in the top-five riskiest markets for the first time.

Balancing labor market

“We’re seeing some continuing high risk and deceleration. On the other hand we’re seeing continued very high appreciation in a lot of areas,” she said. “The other thing that’s really working to balance things out is the underlying labor market fundamentals. Employment growth continues to be strong.”

The Las Vegas metro area led the nation with 6.23 percent employment growth this year compared to 2005, according to the report, followed by Phoenix, Ariz., at 6 percent; Orlando, Fla., at 4.5 percent; Fort Lauderdale, Fla., at 4.4 percent; and Seattle, Wash., at 4.3 percent.

Employment declined in four market areas, including Detroit, Mich., down 1.1 percent; Milwaukee, Wis., down 0.8 percent; Warren-Troy-Farmington Hills, Mich., down 0.6 percent; and Cleveland, Ohio, down 0.1 percent.

Slower home appreciation

Home-price appreciation has slowed in about 34 major real estate markets across the country but is still positive in all of the nation’s 50 largest markets, PMI reported.

The decline in appreciation was steepest in Las Vegas, dropping to 14.5 percent for the period from first-quarter 2005 to first-quarter 2006. That is down 15.6 percent when compared to the appreciation rate of 30.1 percent from first-quarter 2004 to first-quarter 2005.

The year-over-year appreciation rate dropped 15.3 percent in the San Diego metro area and fell 11.4 percent in the Sacramento area.

“We’d reached a point where prices had gotten too far away from economic fundamentals,” said Mark Milner, chief risk officer for PMI Mortgage Insurance Co., in a statement.

“This quarter’s data signals that in many areas the expansion of the housing balloon has slowed substantially. The risk index also shows that slowing price appreciation is balanced by underlying economic strength. In the absence of an unexpected economic shock, this makes a gradual cooling of the market the most likely outcome.”

Lowest risk rating

Those metro areas with the lowest risk rating include Pittsburgh, Pa., at 57 (a 5.7 percent risk of home-price decline within two years); Indianapolis-Carmel, Ind., at 58; Memphis, Tenn. (including areas in Mississippi and Arkansas), at 61; Cincinnati-Middletown, Ohio (including areas of Kentucky and Indiana), at 64; and San Antonio, Texas, at 65.

Haiken said that while the survey is intended to measure short-term price risk, long-term home ownership generally leads to a positive return on investment. “(Some consumers) have had almost a day-trader mentality recently about real estate,” she said, noting that those who are looking for a quick buck could face short-term volatility in market conditions. “In the long term it’s been a very good investment,” she added.

An “Economic and Real Estate Trends” report released by PMI today contains an analysis by economist Charles A. Calhoun on possible best-case and worst-case home-price scenarios for four metro areas: Boston, Los Angeles, Pittsburgh and Houston.

For Boston and Los Angeles the analysis suggests “the strong likelihood of positive house-price appreciation over the next 10 years,” while in Pittsburgh the data suggests “much lower expected appreciation, and very little chance of either very high or very low rates of appreciation.”

Meanwhile, the data suggests that Houston will have positive appreciation on average, but at a lower rate than Boston or Los Angeles.

A separate article in the report suggests that alternative mortgage products such as 40-year and 50-year mortgages “hold some benefit over more risky alternatives, such as piggyback loans, interest-only loans and option adjustable rate mortgages.

Source: Glenn Roberts Jr., Inman News

Resource: PMI Reort

The average price of single-family lots in Horry County doubled from this time last year, an increase attributed to the growing number of upscale neighborhoods in the area.

“It is the price and sale of premium lots that are driving the average price up,” said Bernard Helm, president of MORE.

Horry Co.

Lots sold for an average price of $64,960 in the first quarter of 2005 and $130,155 this year, according to Market Opportunity Research Enterprises or MORE, a real-estate research group in Rocky Mount, N.C.

The median price, or the midpoint of the price range, is not rising as fast because there still are lower-end lots available. The median price of lots increased 17 percent from $38,000 to $44,550. That increase represents the true appreciation in the market.

Georgetown Co.

Georgetown County saw the same kind of dramatic increases, with the average price of lots doubling to $202,498 from $106,688. The median price rose 16 percent to $86,900 from $74,908.

Brunswick Co.

Single-family lots in Brunswick County dropped slightly in median price to $38,000 from $50,000 last year. Helm said the drop was due to more inland lots being sold in Brunswick this year.

Out-of-state buyers

Builders and real estate agents say they’ve been getting more calls from potential buyers in other states.

However, Todd Vencil, an analyst at BB&T Capital Markets in Richmond, Va., told builders in a recent Grand Strand seminar that… as feeder markets cool, like the Northeast or Florida, buyers in those areas may have trouble selling their homes in order to buy on the Grand Strand.

Sales down from 2005

Most brokers are using 2004 data to compare this year’s sales instead of 2005 because last year had unusually high sales. Sales in 2006 are down from last year.

Source: Jenny Burns, The Sun News, Myrtle Beach, SC

You can save yourself a lot of time and aggravation by asking your real estate agent to have a heart-to-heart talk with the listing agent before you make an offer… particularly if you intend to offer significantly less than the list price.

If the seller is adamant about his price, and there are plenty of other similar listings on the market, devote your energies to a seller who is willing to sell at current market value.

Ideally, your offer price should not be above what you think the property is worth or what you can afford, but tempting enough to the seller that he can’t refuse to accept.

Ask your real estate agent to find out:

1. CMA sales, listings, time ~ How much have similar properties been selling for recently? Did they sell for more or less than the asking price? How long did it take them to sell?

2. Interest ~ How much attention is the listing is receiving? Are there other buyers who are serious about writing offers?

3. Time on market ~ How long has the listing been on the market? The longer a listing is on the market, the more likely the seller will be to consider an offer less-than-asking… especially if there are similar new listings coming on the market every week.

4. Motivation, mindset ~ Is the seller is motivated (that is, he really needs rather than just wants to sell)? How realistic is the seller about the current value of his home?

5. Negotiation ~ Don’t be afraid to negotiate, even if you’re not in competition. Some motivated sellers still can’t resist trying for a higher price. Several rounds of counteroffers back and forth could bring about a successful conclusion.

6. Property use ~ Evaluate investment property by the numbers – they work, or not, based on your personal finances and investment objectives. Aesthetics and lifestyle play a much bigger part when purchasing property for personal use - you might consider paying a little more for your ideal home.

7. Close or walk away ~ Close the deal if you are close to agreement and the property suits your needs. Walk away if you’re looking for a bargain and the seller won’t budge.

Source: Dian Hymer, Inman News

For help finding property and making offers, contact Barbara Chartier at 843-902-0204.

A little-known 1988 law could have a big impact on beachfront properties.

Real estate agents who do not disclose the existence of the act could be liable if a hurricane damages a home they sold and the property has to be rebuilt. Homeowners could find they can’t rebuild in the same location or same way.

The Beachfront Management Act, designed to protect beaches from erosion, determines how close a home can be to the beach.

Under the act, the state sets a “setback line.” Homes cannot be built on the ocean side of that line. If a building that was built before the act is destroyed in a hurricane, it might not be able to be built in the same spot because the setback line may have been moved further inland.

Real estate attorney Wayne Mumford suggested agents always disclose the act to protect them against potential liability.

At a Coastal Carolinas Association of Realtors seminar, Bill Eiser, oceanographer with Ocean & Coastal Resource Management said a failure to disclose will not affect the legality of the sale.

The Resource Management office can inform property owners where setback lines are on their property. Setback lines are based on the average annual erosion rate of the beach in the last 40 years.

Source: Jenny Burns, The Sun News, Myrtle Beach, SC

The flights between Boston and Myrtle Beach are scheduled to begin Aug. 15, and the 12:20 p.m. arrival in Myrtle Beach translates to a potential afternoon tee time for those looking to maximize their time on the links.

The daily Spirit schedule has a flight leaving Boston at 10:05 a.m., getting to Myrtle Beach at 12:20, with the return trip leaving at 1:15 and landing in Boston at 3:30 p.m. That will save well over two hours on most one-stop options available through Delta, US Airways and United Express.

Introductory coach fares for the Spirit route start at $79 each way.

Boston has historically been one of the top five golf markets for Myrtle Beach. Combine that with the potential traffic of South Carolinians coming to New England for fall foliage and the growing number of New Englanders retiring to the Carolinas, and Spirit has a potent formula for success.

Source: The Sun News, Myrtle Beach, SC

How to tell if your home is priced right in a high-inventory market –

1. Marketing ~ Make sure that your listing has been properly exposed to the market. Minimally, it should be on the Multiple Listing Service (MLS), on the Internet with photos, and open for local real estate agents.

2. Competition ~ Find out how many homes like yours are on the market in your area, if these homes are being shown, and how frequently? Have any of the listing like yours sold since you put your home on the market? How long is it taking to sell homes like yours? Then take a good look at the price of your home in relationship to the competition.

3. Expectations ~ If there haven’t been any recent sales and listings are taking months to sell, you may need to adjust your expectations about how long it will take to sell your home. However, if other listings are selling, or are at least being actively shown, and your list price is higher than the others, lower your price.

4. Timing ~ The time to make a price adjustment is when you discover that it’s too high, even if this is soon after the property is listed. Staying on the market too long at a high price is risky. If the market softens further, you could end up having to make a bigger price adjustment later.

5. Price Reduction ~ A minor price reduction is likely to result in a modest response. In order to make a positive impact, reduce your list price enough so that your list price is at or below the level of your competitors whose listings are being shown and sold.

6. Defects ~ If your home has an incurable defect, like a location on a busy street, you might need to make a bigger price concession. In a low-inventory market, buyers will overlook such defects. In a high-inventory market, they are less forgiving.

Source: Dian Hymer, Inman News

Sellers: For help in pricing your property contact Barbara Chartier at 843-902-0204..

The owners of Springmaid Beach Resort are considering other options for the RV Campground. But officials aren’t saying what changes will occur, or when. Springmaid aims to have a plan by summer’s end.

Springmaid is at Ocean Boulevard and U.S. 17 Business in Myrtle Beach. The 176 annual campground leases will be honored through the end of this year, assistant general manager Jon Konkel said.

Several campgrounds and mobile home parks, including Barefoot Camping Resort in North Myrtle Beach, have called it quits in the past year as the land values have skyrocketed and developers came knocking. Many of them closed to make way for condominiums or single-family houses.

Source: Dawn Bryant, The Sun News, Myrtle Beach, SC

HERE ARE FIVE KEY REASONS YOUR HOME OR CONDO MIGHT NOT SELL IN TODAY’S “BUYER’S MARKET.”

1. THE ASKING PRICE IS TOO HIGH. By far, this is the top reason a home doesn’t sell. Although you might be just testing the market, prospective home buyers are very smart and they know an overpriced listing when they see it. Worse, their buyer’s agents won’t even bother showing homes with asking prices above recent sales prices of comparable nearby homes.

If you want to get your home sold during this peak sales season, it is vital for your listing agent to keep you informed on a weekly basis of recent comparable home sales prices. Perhaps it’s time for an asking price reduction.

2. THE COND/HOME IS DIFFICULT TO SHOW. Here are three types: Properties on short term rental programs can’t be shown unless vacant, or during limited “change over” times; Properties requiring buyer’s agents to drive to a distance office to pick up keys; and Properties requiring the listing agent to be present for all showings.

Unless there is a security reason, listed homes should always have a multiple listing service (MLS) lockbox key easily available for buyers’ agent showings on short notice. Lock boxes are especially important for buyer’s agents with out-of-town buyers who have a short time available to inspect homes for purchase.

3. CONDITION OF THE HOME. Most home buyers want to purchase a condo/home in near “model home” condition where all they have to do is turn the key in the front door and move in. However, if the residence requires considerable work, that turns off all but the most die-hard bargain hunting home buyers.

Fixer-upper homes appeal to a very limited market of home buyers who will purchase such homes only at bargain prices, well below what can be obtained with modest fix-up work such as painting (the most profitable improvement of all), repairing, and cleaning.

Buyers’ agents will only show that residence to their bargain hunters, usually investors, who want to purchase far below market value.

4. “AS IS” HOME SALE CAN BE A RED FLAG TURN-OFF. Closely related to homes that don’t show well are those listed for sale in “as is” condition. The term “as is” means the seller offers the residence in its current condition and will not pay for any repairs. However, the seller must still disclose in writing to buyers all known defects, such as a leaky roof or a bad foundation.

Whenever possible, home sellers should not offer their homes for sale “as is” because it is like waving a red flag in the buyer’s face. A better alternative is for the seller to obtain a professional inspection report and have the recommended repairs made before listing the home for sale.

Of course, when a home needs a major repair that the seller either can’t afford or doesn’t want to make, then an “as is” sale at a reduced price is advisable.

5. INEFFECTIVE MARKETING METHODS. In today’s “buyer’s market,” listing agents must use every marketing resource available. Most effective is the for sale sign on the front lawn. A close second is weekly newspaper advertising, especially for a weekend open house. In third place is Internet advertising.

In addition, listing agents have the local MLS and their special networking among agents who represent prospective buyers for the type of house or condo listed for sale.

CONCLUSION: Selling houses and condos in the current buyer’s market requires hard work by successful listing agents. If your home has been listed for sale with a successful realty agent over 45 days and without any purchase offers, it’s time to discuss the five key reasons some homes don’t sell with the listing agent and make adjustments to get your home sold.

Source: Bob Bruss, Inman News

For more information on “Selling Property in a Buyer’s Market,” contact Barbara Chartier at 843-902-0204.

As the price gap between new and resale condominiums narrows in Horry County, analysts say it will become more attractive for buyers to look at new condos.

Dramatic price increases in condo resales have brought that average price closer to the prices of new condos, said Carl Van Horn, analyst with Market Opportunity Research Enterprises, a real estate research group in Rocky Mount, N.C.

In the first quarter of 2005, the average price of new condos was $197,154 and the average price of resale condos was $179,242 - about an $18,000 difference.

In the first quarter of 2006, the average price of new condos increased to $214,282 and the average price of resale condos increased to $207,619 - about a $7,000 difference.

“There’s been enough upward pressure on resale condo prices that it’s more attractive to look at new condos,” Van Horn said.

Those higher prices are making resales less attractive and will eventually push up new condo prices, Van Horn said.

He expects next year there will be higher average prices on new condos and an increased gap in the difference between resale condos.

Source: Jenny Burns, The Sun News, Myrtle, SC

No Bubble

There’s no bubble in the Grand Strand’s real estate market, but prices may stabilize, a national analyst said. “A boom doesn’t mean bust,” said Todd Vencil, Capital Markets financial analyst for BB&T.

Vencil spoke to about 100 local home builders and real estate agents Tuesday night about the future of the building industry. For the market to go bust, Vencil said, the area would need to experience large job losses or an economic shock.

He cited a study by the Federal Deposit Insurance Corporation that says a bust occurred in 9 out of 54 boom periods prior to 1998 within a five-year window.

Speculators, he added, were behind the significant drive up in prices. Their departure is causing the market to slow. “But your slowdown is nowhere near as bad as Florida,” Vencil said.

Baby Boomers

Joel Warner, owner of Warner Custom Homes, said he agrees with Vencil. “The investor market is dropping off. I do think prices are starting to stabilize…. But I do think that this Grand Strand area is going to continue to boom with all the baby boomers,” Warner said.

Warner caters to the baby boomer market through condominiums, townhomes and single family homes at about 2,500 square feet because most boomers want to downsize, he said.

Vencil told builders that the active adult market would be a sweet spot for the next 10 to 15 years. “A lot of what baby boomers want isn’t in the housing stock,” he said.

Hurricanes

One topic at the top of builders’ minds was how hurricanes in Florida and the Gulf were affecting Myrtle Beach real estate. Vencil said he had not seen any significant numbers to show that people are leaving Florida and moving north.

Reasons that the housing boom slowed in the second half of 2005 was primarily affordability from rising prices and a shaken consumer confidence after Hurricane Katrina, Vencil said.

“Prices went up a lot and housing became less affordable. Investors started pulling back after Katrina. Investors have gone from buyers to sellers,” he said.

Nationally, sales slowed and inventory increased. While the rising federal funds rate didn’t affect 30-year mortgage rates much, it did affect adjustable rate mortgages, which are now hurting some homeowners, he said.

Source: Jenny Burns, The Sun News, Myrtle Beach, SC

A CONTEST on the Classic Golf Group Web site: www.playaclassic.com will determine the new name for Pawleys Island Golf Club which is expected to open in fall 2007.

All entries are due by July 15, and the winning entry will receive a free golf membership to the new club. If the chosen name is submitted multiple times, the first submission will earn the prize.

Owners said, “We’re trying to come up with something good that relates to the character of the place down here, and has something to do with the Waccamaw River and the oak trees.”

The new name should help people locate the course without confusing it with others in the area.

The new course is being designed by Tom Walker, former lead architect for Gary Player, and is expected to have a Lowcountry feel.

Source: Alan Blondin, The Sun News, Myrtle Beach, SC

Investors owned 58 percent of the homes sold in Myrtle Beach in 2004 - putting the Grand Strand at the top of a national list in the number of investor-owned homes.

National analysts are concerned that cities with significant numbers of investor-owned homes could be in trouble if investors decide the market has peaked and unload their units.

In Myrtle Beach, the only drops have been in condo sales - with no sign of overall price declines.

The National Association of Realtors chief economist David Lereah expects investment home sales to decline this year due to higher interest rates and less incentive for speculation because price appreciation is cooling.

While the Strand hasn’t seen evidence of significant price declines like some Florida areas, it has had an increasing number of units on the market.

Local analyst Tom Maeser, president of the Fortune Academy of Real Estate, believes many of the area’s investors are second home owners - who buy a place at the beach with plans to use it primarily for personal vacations.

The area needs more of those buyers, he said. “We have to replace that investor who wants rental income with an investor who wants a second home and appreciation,” Maeser said.

Maeser said growing inventory and plunging sales in some second-home markets across the country is a valid concern. So far, he says the Strand market seems to be doing fine.

Source: Jenny Burns, The Sun News, Myrtle Beach, SC

The real estate market is favoring buyers instead of sellers, with rising interest rates and increasing inventories. That makes it more important than ever to price your home correctly.

How to price your home in a buyer’s market:

1. Realize that the market has changed: your property may take longer to sell… at a lower price than it would have six months or a year ago.

2. Use recent actual sales figures to determine market value: your real estate agent can provide you with comparable sales of similar properties… location, size, condition, furnishings, etc. Data should be less than 6 months old.

3. Know your competition: compare listings of similar properties. Realize, however, that many properties are currently overpriced because sellers have not come to terms with market changes.

4. Keep your emotions in check: it’s only human nature to think that your home is worth more than it is. Rely on your real estate agent for objectivity.

5. Prepare your property for sale: paint, clean carpets, make repairs, remove clutter and personal items, and store extra furniture. Property in move-in condition will bring the best price.

6. Price your property to sell now: your property will attract the most buyers when it first goes on the market. A common mistake is to set the price too high initially to leave room for negotiation. Buyers look at price first and ignore overpriced properties.

Source: Theresa Agovino, Associated Press

For a free Comparative Market Report on your property, contact Barbara Chartier at 843-902-0204.

The world’s tallest sand castle faced The Myrtle Beach Pavilion Amusement Park… was topped by more than two dozen spires… and was guarded by a pair of gargoyles.

Over 35 foot high, the Myrtle Beach sand castle surpassed the former record holder (32.49 feet tall - built in 2003 in Falmouth, Maine) by more than 3 feet.

City officials, sporting printed T-shirts bearing the official height, watched as a camera-equipped mini-helicopter flew over the 60-foot-wide structure for visual confirmation. The castle is wide enough for six dump trucks to drive through.

Evidence now goes to the Guinness Book of World Records for confirmation. That could take months - far longer than the eight days it took six professionals to build the castle.

Source and Photos: Lisa Fleisher, The Sun News, Myrtle Beach, SC

Traffic at Myrtle Beach International Airport continued to slide in May but not by as much as the previous few months.

Blame the decline on reductions by many of the airlines, which have cut the number of seats in recent months aiming to stay afloat in the turbulent airline industry, said Bob Kemp, the airport’s director.

Seat capacity in Myrtle Beach has dropped by 30 percent since January, he said.

“It is basically a reduction in capacity by most of our airlines,” Kemp said. “They are flying almost full. We simply don’t have enough seats coming in here.”

Delta, Spirit and U.S. Airways have cut back. Hooters Air called it quits for scheduled flights in April, also contributing to May’s decline.

The seat crunch will make it challenging for locals to get flights for their summer vacations unless they plan ahead, Kemp said. It also isn’t good news to tourism promoters as Myrtle Beach gears up for the busy season, said Brad Dean, president of the Myrtle Beach Area Chamber of Commerce.

“Having fewer available seats is problematic,” he said. “Fewer flights during our peak season is like a retailer running light on product before a big holiday.”

The cost of some of those flights also hurts by prompting golfers to skip Myrtle Beach and go to more affordable locations in Florida.

Source: Dawn Bryant, The Sun News, Myrtle Beach, SC