Boom amid the bust

Rows of houses that have recently sold line the neighborhood of Creek's Edge, north of Rock Hill.
Rows of houses that have recently sold line the neighborhood of Creek's Edge, north of Rock Hill.

The Rock Hill area posted a significant increase in home sales last month, despite that sales across the rest of the state are bottoming out, experts say.

In June -- typically a hot home selling month -- sales slipped in 14 out of 15 S.C. regions. Real estate experts say sales should rebound slowly starting next spring.

Sales fell 11 percent statewide. Columbia-area sales dropped 3.5 percent. Greenwood fared the worst with sales plunging 31.3 percent.

June's only bright spot was the Rock Hill area, which posted a 14.4 percent sales increase.

The numbers come as no surprise to local real estate agents.

"I perceive the Charlotte market as being where Atlanta was 20 years ago," said Butch Brindel, CEO of the Piedmont Regional Association of Realtors. "It's going to be insulated from downturns in the economy. Look at the ring cities around Charlotte and look at how well we're doing.

You're seeing a push to the south now."

Rock Hill Realtor Judy Castorina said lower taxes are luring newcomers south of the state line. She sees that trend as only continuing as changes to the state property tax code make it less expensive to own a home.

"We've got a lot of people moving out of Mecklenburg into York and the Lancaster Panhandle because of the tax base," she said. "The quality of education has always been very good. They can still work in the Charlotte area if they have to."

The state's median home sales price fell slightly in June. However, prices rose by more than 5 percent in Columbia.

But sellers are having to wait longer. The number of days homes are on the market before they sell rose by about two weeks in Columbia and statewide last month, compared with a year earlier.

June was not the year's worst month. May showed bigger declines, with sales falling 13 percent across the state.

So far this year, sales statewide are down 8.3 percent. The coast continues to get hammered, while several other scattered areas also saw decreases.

Six regions -- including Columbia -- are hanging on to gains.

"I'm reluctant to label it a slump," said Mark Vitner, senior economist for Wachovia, the Charlotte-based banking giant. "The current level of home sales is actually quite strong. The problem is, two years ago sales were unbelievably and unsustainably strong. In a slump, sales would have dropped another 50 percent."

Despite consecutive months of double-digit statewide sales drops, Nick Kremydas, chief executive of the S.C. Association of Realtors, said he expects sales to creep up in coming months.

"It seems the worst of the soft landing has occurred," he said.

Todd Beckstrom, an agent with ERA Wilder Realty in Chapin, said sales have been steady this year in Columbia. However, Beckstrom said he is seeing more inventory on the market than normal because houses are being built faster than they are being sold.

Still, if homes are priced right and are in good condition, they are selling, he said.

"If I see a little blip in one month, I'm not afraid," Beckstrom said. "If it becomes a trend, then there's a reason for concern."

Kremydas said the market -- driven up mainly by investors along the coast two years ago -- is continuing to normalize as speculators have pulled out en masse. With the investors gone, a more realistic home market is emerging, he said.

Beckstrom said another factor affecting the coast is the number of second homes there.

"Second-home markets are affected first when people get a little iffy," he said. "I think it'll come back. ... We've had a slight correction."

Median home sales price -- the point in the market where half the homes sold for less and half for more -- slid 2.2 percent statewide in June to $166,000, though prices in the Columbia area rose 5.6 percent to $150,000.

Hit hardest last month was the Anderson area, which saw sale prices plummet 31.5 percent.

In the first half of the year, Columbia's median sales price is up 3.25 percent, while the state median fell slightly.

The number of days homes are staying on the market has increased 13.8 percent statewide to 131 in June. In Columbia, "for sale" signs are staying in yards an average of 86 days -- a 16.2 percent increase.

Beaufort saw the biggest increase, to 183 days last month from 100 days a year earlier. The Anderson and Aiken areas were the only ones where homes were selling faster than in June 2006.

Vitner said S.C. home sales shouldn't get much worse -- or much better, either -- in the foreseeable future.

"We expect sales to bottom out soon, if they haven't already," he said. He anticipates a slow climb, possibly beginning in the spring.

"We're not looking for much improvement."

Home sales also are expected to stabilize soon nationally, Federal Reserve chairman Ben Bernanke said. But even if that happens, new-home construction will remain weak as builders work off excess inventories of unsold homes, so the housing slump will continue to be a drag on the national economy for some time, he said.

Kremydas said the overall market in South Carolina is still good, despite the declines.

"There's no signs or indications that we need to be panicking about anything. Going into the next year and as we round out this decade, I think we're going to see just another explosion."