Columbia real estate a seller’s market

About a decade ago, Mel Go thought about selling her home in the Knollwood subdivision near the Dorn Veterans Administration Medical Center on Garners Ferry Road.

But with the housing market in the depths of the Great Recession, she decided to wait, and spent the years since working on improvements to the 49-year-old home, such as refinishing hardwood floors and improving her kitchen.

Today, she is placing the four-bedroom, two-bath, 1,850-square-foot house on the market. “I’m really optimistic that things are better for the sellers,” she said.

With the traditional home buying season set to begin in April, it will be a sellers market, realtors say.

And with housing inventory at it lowest since 2003, and the threat of interest rate hikes looming, buyers are getting an early start.

“Buying season has already started and we haven’t even reached the end of the quarter,” said Karen Yip of Yip Premier Real Estate. “It bodes well if you’re selling a house. It’s moving toward a sellers market.”

Also, the economy is improving and unemployment rates are down. “So people feel comfortable entering the market,” she said.

Graeme Moore, of the real estate firm The Moore Company, said in addition to an improving economy, the threat of rising interest rates is driving the market.

“Every time there is an announcement (that interests rates might go up), we get a rush for two weeks,” he said.

The Federal Reserve raised its benchmark rate on March 12 to a range between 0.75 percent and 1 percent. It was the second hike in three months.

Why rent?

Rental rates are up, said Yip, which is also moving people to buy. Her company also manages property.

The adage “Why rent when you can buy?” has never been truer than today, she said.

Statewide, the Multiple Listing Service shows a continuing trend of price increases and fewer homes for sale.

New listings were up about 7 percent across the state in February, over February 2016, while pending sales shrank 6 percent. The number of homes for sale decreased by 6 percent in February from the same month a year ago, and prices were up by 7 percent with a median sales price of $180,000.

“A projected increase in interest rates, coupled with continued inventory shortage, could result in higher prices, thus impacting affordability in some areas,” said Nick Kremydas, chief executive of South Carolina Realtors.

In the Midlands, unincorporated Lexington County continues to lead in the most homes listed and sold, with new neighborhoods being developed around the town of Lexington, the Red Bank community and near Lake Murray.

But the downtown Columbia market is the story this buying season, with prices in select neighborhoods rocketing.

In Melrose Heights, prices in February were up 54.7 percent, with an average sales price of $315,000. In Shandon, prices rose 38.4 percent, with an average sales price of $388,452.

“The downtown market is where it’s at,” Moore said.

Move-in ready homes

Moore noted the vibrancy and entertainment options in Columbia’s growing downtown – an expanding Vista, revitalized Main Street, emerging North Main and the expectations for Bull Street – combined with a national trend toward downtown living are driving the price spikes.

“People want to be close to all of that,” Moore said. “All of those neighborhoods are within 10 minutes of downtown.”

While downtown is booming, Moore said prices are holding steady in the suburbs, despite continued construction of new homes.

Northeast Richland prices rose 0.2 percent with an average sales price of $189,773. In Lexington County, prices dropped 2.5 percent to an average price of $185,364.

It’s hard to compare those numbers with downtown and in-town neighborhoods.

In the past two months, nine houses sold in Shandon, compared to 347 in Northeast Richland, while 20 houses sold in Forest Acres compared to 574 in Lexington County.

When people buy, they are looking for new or remodeled homes, not fixer-uppers.

“People want move-in ready homes,” Yip said.

And they want certain amenities: Walk-in closets, granite counter tops, open floor plans, modern fixtures and large fenced yards.

“They don’t want to buy grandma’s home anymore,” Moore added.

This story was originally published March 24, 2017 at 12:26 PM with the headline "Columbia real estate a seller’s market."