Sellers facing fierce competition - some price ranges stagnate

A new study of six price categories shows the highest number of homes for sale on the Grand Strand market are in the $150,000 to $250,000 price range, with 2,095 homes. That’s a year’s worth of home inventory.

Agents listing homes in this price range say they’re battling builders’ new incentive packages - and sellers have only one choice if they want to sell: lower the price.

The study, which looked at the number of listings and sales in Horry and Georgetown counties’ Multiple Listing Service, shows a “shortage” of supply in the under-$150,000 range, said Tom Maeser, president of the Fortune Academy of Real Estate, who conducted the study.

• But the other price ranges, starting at $150,000 and up, show an oversupply as they grow from 11.5 months of supply to 54 months of supply for million-dollar homes, he said.

• What’s interesting is the higher price ranges are selling at about the same pace they were a year ago, but the sales pace for homes under $250,000 has slowed dramatically.

• Maeser said that’s because of the loss of investors and tightening on subprime loans and higher interest rates.

The lesson from the study is to price your home right and make sure you’re competitive with builder prices including incentives, he said. If the resale market becomes at least 20 percent cheaper than new homes, buyers will start taking notice, he said. It’s about a 12 percent difference right now.

Here’s an overview of the study’s price ranges and recent activity.

• Homes under $150,000 have the fewest months of supply - with only 665 on the market - and analysts say there’s room for more, especially since that’s the price range that the Strand’s work force can afford. Condos in this price range have the second-largest inventory amount of 2,047. That’s a 19-month supply.

• The $150,000 and $250,000 price category has the highest number of homes and condos on the market. It’s the popular price point for many national builders. Analysts say sellers must price right and keep a close eye on builder prices. There are 3,597 condos in this group - the highest of any price range. That’s 37 months of inventory - the longest of all the condo pricing categories.

• Homes between $250,000 and $350,000 have the second-highest supply of homes, taking 16 months to sell based on today’s sales pace. For condos, this category will take the longest to sell, with a 37-month supply.

• The $350,000 and $450,000 range has 704 homes on the market for a 21-month supply. Agents say homes in this price range must really be the best value in the neighborhood. Condos in the price range are seeing a 29-month supply with 929 units on the market.

• The $450,000 to $1 million category has 1,195 homes on the market with a 3-month absorption rate. Sales in this price range have dropped since last year from 531 sales to 420. Among condos, the absorption rate is smaller - 24 months - with 1,285 units on the market.

• There are 487 homes above $1 million on the market with a 54-month supply. Sales are down 24 percent since last year in this price range. About 91 condos are for sale above $1 million with a 35-month supply.

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