(Part 1 of a Series of Articles about Investing in Charleston SC Real Estate)
The Charleston SC realty market is a great investment. Would I have said this in 2008? Yes. Yes, I would have. In fact, I did.
Why? First let me say that it was never meant to be a short term investment. Between 1997 and 2000 we had moderate rises in value. Normal and healthy.
From 2000 to 2004, "Come on in, the water is great!." The short term investors jumped in and the market started to ignite.
From 2004 to 2006, "Total Insanity." Buyers were fighting. People were stressed. Everywhere people talked about real estate. I had to hush someone in a movie theater because they were talking about their latest purchase. I actually sold a home in the morning for $600,000 and then that same afternoon I sold it for $750,000. Two great closings on a Friday. These quick flips happened all the time.
So when the unrealistic market of 2006 started to correct itself and the the 2008 meltdown occurred, how could I have said it was a great investment?
It is simple. Real estate was never meant to be a short term investment. It is a place to build a nest egg. To plant seeds. To nurture. Certainly there are rises and falls in the market, and in retrospect, while all of us made hay when the sun shined, we got comfortable with the fact that a 10% increase in the Charleston SC realty market or more per year was ok. In 2008 we got a wake up call to become smart consumers again. Time to start pinching our pennies. Now there is another wake up call.
Timing is key, and the key is timing. Strategize. These are real investments. Properties are more than a house with a yard to mow. They are part of a much bigger picture. A portfolio if you will. Remember, everyone lives in a place and everyone needs a place to live. (say that 5x fast)
Not only are the rates down, you can buy a lot of house for the money right now. And since we had such a dramatic rise between 2004 and 2006, the counterpart correction in value has also been drastic. This drastic fall is very, very good. The 20 years prior to 2000 showed a steady rise. Then we had a major increase. Then it peaked. Now it is correcting. Pepper in some distressed opportunities and then dash in a chance to invest for a very, very low interest rate. This is a great recipe!
Consider this. I just refinanced my house. My previous rate was 5.25%. This was incredible in 2006. Everyone though this rate was great at the time. Guess what my current rate is.... 3.25% . So for about $100 more per month, I was able to take my 30 year loan down to a 15 year loan. Pretty incredible.
Oh, one last thing. The rental market. It is red hot. It seems like every house I list, someone calls me wanting to rent it. I am beating renters down with a stick.
Why not take 20k, find a nice little starter home in a decent area. Make sure it has enough bedrooms and baths and get a 15 year loan. We can crunch numbers to make sure it pays for itself or better. Rent it out 15 times over the next 15 years. On year 16, you are making straight cash flow. Your retirement plan is now starting to pay off. (if you do this once, you can do it twice - even 3x a year if you like)
The market has never been as primed as it is right now. And hey, I specialize in finding the best offerings available. Call or email me anytime for some options to consider.
PS - Can you tell I am excited about this?
Nat Wallen is a Realtor in Charleston SC specializing in residential property sales. He has been licensed since 1995 and is the top listing agent with Carolina One Real Estate. Carolina One Real Estate is the largest company in the Charleston SC area of 700 plus agents. NOTE: Nat Wallen never solicits consumers interacting with his blog unless requested. YOUR comments are encouraged and welcomed. Thanks!