[Music]
Hello everyone and Welcome to another
episode of Selling Greenville your
favorite podcast about the Greenville
real estate market as always I am your
host Stan McCune and if you need to reach
me for any reason my contact information
is in the show notes like it always is
you can call me text me email me at any
time with information that you find in
there and as always I always ask if you
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just make sure you're subscribed to it
that you don't miss any future episodes
give us a rating leave us a review if
you can that's great I love to see those
ratings and those reviews whenever you
guys leave them really appreciate it
really gives me confidence to keep this
podcast going and we are now at episode
number 25 I'm recording this on August
the 10th I will probably release it a
little bit later in this week but I'm
really excited episode 25 we have done
an episode every week for 25 weeks now
that's almost half a year and I'm really
excited about that this is some of the
stuff that the Corona virus that
covid-19 has opened the door for right
because I I didn't used to spend as much
time in my home office and quite frankly
I've had more time this year than normal
because there is just less real estate
activity even though it's still busy
it's not as busy as last year obviously
because there are fewer Sellers and
that's causing there to be fewer buyers
as well and it's giving me a little
bit of extra time to work on this
podcast which I probably couldn't have
done in previous years and I'm really
happy about that I'm really happy with
how the has gone but we need to talk a
little bit more about the market the
real estate market what is going on it's
it's kind of weird it's kind of crazy
for those of you that are tracking
stocks and and that that track things
like that there's a lot going on in the
stock market as well obviously I'm no
financial planner no financial adviser
but I'm seeing the price of gold and
silver go up I'm seeing mortgage
interest rates and other interest rates
go down there's a lot going on that is
concerning a lot of people I'm not going
to get into all of that but just know
that there there's a lot of
uncertainty right now and people are
concerned and that is having a ripple
effect in the real estate market but
I don't exactly know where that's going
to go all that I can tell you right now
is what I see happening in real estate
and where I see real estate probably
going
down in the future into maybe early
or the middle of next year and that's
what I want to talk about today so for
starters I've already alluded to this
but this is literally the weirdest real
estate market ever now you'll remember
earlier this year we had interest rates
plummet because the fed you know the
Federal Reserve they dropped interest
rates on their end when that happens
that usually means mortgage interest
rates drop as well well but there was a
weird phenomenon that happened at that
time and that's that Banks couldn't meet
the demand for refinances and for new
mortgages when those interest rates
dropped so what ended up happening is
that Banks actually increased their
rates a little bit the rates actually
kind of went up in a lot of instances
because the banks couldn't handle the
the number of applications that they
were getting and it's simple economics
when demand and outpaces Supply prices
go up so even though all by any other
standard interest rates should have gone
down they actually went up well it seems
that banks have figured out you know
maybe improved their Staffing or
improved their processes or whatever the
case may be and interest rates have gone
down and they are
unbelievably low we are seeing 15-year
mortgages down in the low twos like
nearly in the high ones we have seen
30-year loans going even on
refinances going below 3% into the mid
to high twos I mean I never thought that
this would happen honestly I never
wanted this to happen this is almost
scary I don't really know what to make
of this
exactly but it's great if you are
refinancing or or getting a mortgage on
a new property so it's in one sense it's
never been a better time to
buy except from the standpoint that that
so fewer people are selling their homes
right now the inventory levels are just
insane they're hovering around two to
three months of inventory which is an
unbelievably insane sellers Market
and so it's it's weird because it's been
like the best time to sell and also one
of the best times to buy at the same
time but nobody can do either right
because people that are selling a lot of
them have dropped out of the market for
one reason or another they're concerned
about the economy they want to hold
off they don't you know they don't
want to move right now whatever the case
may be and those that are looking to buy
they don't have hardly anything to look
at there is so little inventory so it
is unbelievably
weird I've never seen anything like this
where buyers and sellers are in such a
great position to do that to buy or to
sell but that so few Buy buyers and
sellers are out there because of the
meta issues going on with covid perhaps
the election year is playing into that a
little bit uncertainty about the
economy all these different things it's
causing people to to do things that
they normally wouldn't when it comes to
this market and it's really causing a
crazy ripple
effect now what does that mean
practically speaking and and what have I
seen practically how this should
impact you as a potential real estate
player as someone who might be buying or
selling a home in the near future all
right let me let me talk to my sellers
right now okay and this is a
conversation that I have with people
that are listing their home with me
anyway but for those of you that are
thinking about selling let me put this
bug in your ear okay homes that are
sitting on the market that have sat on
the market for a while are languishing
it's a very interesting thing and I
think this has to do with the fact that
so many buyers have dropped out of the
market now there still appears to be
well many more buyers than there are
sellers but a lot of buyers have dropped
out of the market there's just fewer
people doing real estate transactions
right now and so what's happening is
that the buyers are all jumping on the
new listings and when the new listings
come up everyone's freaking out and
they're like okay I got to get that home
I gotta get that home well what
happens if that doesn't happen pretty
soon in the life cycle life cycle of a
listing particularly if it's a an
inexpensive listing and so we're talking
about like 250 and Below now for now
what I've found is for listings that are
more expensive 250 and above those
are tending to take a little bit longer
again because there are probably fewer
buyers in that price point right now
than there normally are people you
know that are trying to sell those homes
are having to be a little bit more
patient in some ways it's not quite the
Feeding Frenzy right on the front end
that it has been in the past or that
we've been used to the past few years
but particularly if you're selling a
home below 250 you know and if you
start getting into the low 200s the high
100s particularly I mean that home
really needs to sell fairly quickly if
it languishes on the market if it
lingers for several weeks for like a
month for 2 months which normally is
not that big of a deal right the average
house in in Greenville County tends to
sell in like 50 or so days and by sell I
mean go under contract in like 50 or so
days but right now that's a really bad
Benchmark to look at if your home has
been on the market for 50 or so days
it's probably going to be on the market
for a while longer and what we're seeing
is that people aren't looking at the
homes that have been on the market
for a while for whatever reason they
they have skepticism about those homes
they're worried you know they're like
well what this home shouldn't have been
on the market for this long what's wrong
with it and so if you overprice your
home then what that means is that your
home is not going to get that that
benefit from the early listings people
aren't going to be excited about it from
the get-go and then it's going to be on
the market for a while and then when you
do finally start to drop your price to
where it needs to be you're going to
find that you're not going to get the
same amount of activity that you did if
you had just started by listing it at
that price point so you need to list it
for the correct price obviously you
don't want to underprice it either I see
so often in this market and we've talked
about this before so I apologize if
you've heard this again but or if
you're hearing this again from me but
so often I see these situations where
sellers try to drup bidding wars and
in this market because our prices are so
cheap it just doesn't work the the price
that works in other markets where real
estate is a lot more expensive but here
in this market and where people are
looking for bargains and whatnot it just
it doesn't typically work it's best you
have to find what the home is worth and
price it accordingly not too high not
too low but particularly not too high
if you price it too low you'll sell it
you just won't sell it for as much as
you probably could have if you price it
too high you're just not going to sell
it
and you're going to find yourself in
a in a bad situation there here's
another piece of advice for my buyers
all right so that was from my sellers
here's for my buyers if you can make
this work
financially now is the time to find your
quote unquote forever home this is
something that we we deal with so we've
got firsttime home buyers they're
typically buying starter homes those
first-time home buyers after a few years
they typically look to purchase an
intermediate home and then a few years
after that they find their forever home
right this is the this is what we call
and what a lot of people refer to when
they're talking about the American dream
it is this process of of being able to
to end up in your forever home the
people that are doing really really well
right now are the people that are able
to make the leap from the starter home
directly into their forever home and
there are two reasons for that one is
that it seems like disproportionately
buyers on the top end
and I'm using top end pretty generically
but let's just say 300,000 and above
that is squarely the top end of the
market the median home sale in
Greenville County or in the in the
upstate is around 230 so once we get
into 300 and above that's starting to be
by Greenville County standards a very
nice home and honestly you go to the to
the other counties to Spartanburg to
aone Anderson I mean you're talking
about a really real you could get like a
mansion in Anderson for for
$300,000 but there are a lot more
buyers at that price point that have
dropped out than the buyers in the low
200s that have dropped out so you have
much less competition to deal with for a
home that is say 300
$50,000 than you would have in the past
and if you're looking to make an
intermediary type of home purchase
and you're maybe going from a home that
you bought a few years ago for like
150,000 and now you're looking to jump
up to a home that's like 225,000 or
230,000 or whatever the case may be
you're going to find that there is still
quite a bit of competition that you're
dealing with tons of bidding wars which
we'll get to in a second but tons of
competition at that price point if
you can make the leap to that forever
home to that home and and obviously that
might look different to different people
but that you know maybe that 325 350
$375,000 home if you can find a way to
make the numbers work you will find that
there is much less competition you can
probably get the seller to to come down
on the price in certain situations
you will you will find that you're much
less likely to get into bidding wars it
is a much more enjoyable and and and
successful route to go in that way and
there's another big benefit as well
right right now interest rates we just
talked about they're in like the tubes
okay not that long ago they were in
the sixes and the fives and you know
just basically like
a year ago they were in the fours for
a lot of people so interest rates are
going to go up listen they are going to
go up and probably in a few years they
will be double what they are now it's
going to be a big gut punch to a lot of
people that right now they buy you know
that intermediate home for 200 something
thousand at a you know
2.75% interest rate and then when
they're ready to to make the next jump
into their forever home in a few years a
that that forever home will have
appreciated so instead of it being a
$325,000 home now it's a $380,000 home
but also your interest rate your
mortgage interest rate it's likely it's
going to be like 5% or something like
that like rates are going to go up that
is going to happen at some point and
that's going to be a major gut punch to
go from oh man I've got such a sweet
deal on this house and I don't want to
give this house up and I don't want
to you know surrender this mortgage but
I've got to sell this house in order to
to make the next move how am I going to
do this if you can cut out that
intermediate home and I not know not
everyone can but if you can do that you
will set yourself up for the future
in a really really good way you will
have a mortgage interest rate
that 15 years from now people will be
astonished by people will be like wait
what's your interest
rate how did you possibly pull that off
and you'll just be laughing and it's
like well I made a good financial
decision back in 2020 so that's some
advice that I'm giving to to my buyers
for those that are investors
obviously it's a great time to purchase
Buy and Hold properties for the same
reason interest rates are really low now
they're not as low for investment
properties
as they are for owner occupied
properties of course but but it's
still a really great time to buy rental
properties Buy and Hold properties of
of any kind not a great time to buy
commercial there's a lot of uncertainty
with commercial I'm not a commercial
realtor so that's not my area of
expertise but from talking to people
there's a lot of uncertainty in that
market right now so I'm I'm very leery
of that market but in terms of rental
properties really we're running into
the same thing we do with with any
purchases is that there's not a lot of
inventory out there but if you can find
the right option get it under contract
get that low interest rate you're set up
for the future in a very very good way
it you know as far as like flipping
properties go because I get this
question a lot I've got a lot of clients
that flip properties I flip properties
myself from time to time that's a
challenging Market there is
particularly the past like three to four
weeks the opportunities on properties
that could potentially be flipped has
gone down way way
far there is just not hardly anything
out there to flip and so if you trying
to flip you definitely have to be
creative right now this is just it's
just challenging in a lot of ways right
now for the flippers I'm actually
seriously considering getting into
direct marketing trying to Market
directly to potential sellers myself
because we just don't have enough Supply
to meet the demand for those that are
wanting to to do that type of thing for
those that are wanting to rehab houses
so I'll keep you guys more in the
loop on that but that is something to
keep in mind if you're an investor
buyer now again again for for buyers I I
caution sellers to be too bullish on
this but for
buyers bidding wars are just the way it
is right now particularly again if
you're in that sweet spot that below 250
price point bidding wars are just the
norm right now and I don't see that
changing unless the economy shifts right
unless we see a major downturn in the
economy thus far the economy seems
like it's been pretty resilient it's
been mostly low wage earners that
people in retail and brick and mortar
that have been hit the hardest by
covid-19 and I hate that for them but
generally that that means that the
economy is is still doing okay it
could do a lot better obviously but
unless it really starts to get to the
point where those you know middle
level management type of people are
starting to get laid off or where you
know companies that aren't brick-and
mortar type of establishments are really
starting to do Mass layoffs I don't see
a major economic shift happening just my
personal opinion so so forbidding
Wars you kind of have to just get used
to that and you kind of have to plan
accordingly and what I tell a lot of my
clients listen you need to just ignore
the list price in a lot of
situations the list price helps you
to kind of get a sense of what the
seller is thinking but I mean I just saw
a house just I think it was just today
just today or maybe it was yesterday
it was a duplex that the price dropped
from
$400,000 get this to
$275,000 so that's an instance of a
seller that was just they found an agent
that was that agent was probably like oh
yeah I'll definitely list this this for
$400,000 and see what happens and
obviously who on Earth unless unless
this is the world's nicest duplex at
least for this area nobody's going to
buy that for $400,000 I'm sorry there
isn't a market for that in Greenville
County and you just in a situation
like that like obviously that was an
anomaly but most people they they list a
property for roundabout what they think
it's worth but you as a buyer you need
to be thinking about what is this
property Worth to me and don't get
fixated on the list price right don't
get you know if if it's listed for what
seems like a great deal probably there's
going to be a lot of other people
bidding on that property there's going
to be a lot of offers on that property
and you need to be thinking in from the
standpoint of what is this property
Worth to me it might be listed for
200,000 but but what if that property
came on the market for 230 would you
have been interested in it at that point
well if the answer is yes then you might
want to offer 230 and in that case I
recommend to my clients to offer
escalating offers that allow them to not
lead with the 230 but allows them to go
up to 230 if the seller can provide
proof of a competing offer that was
close to that price point that's
something that we've talked about in the
past but there are some tricks that you
can do with some of
that
on the flip side if a property is
listed for too high then yeah you can
offer what it's worth to you that's
lower than the list price just
understand right now that a lot of
sellers are a little bit I don't want to
say delusional but like I said that one
that listed that duplex for
$400,000 you know they weren't being
serious about selling it for $400,000
they just wanted to see what the market
said obviously the market said heck no
and now they just dropped it by
$125,000 but understand that when a
house gets first listed if you want to
come in there with an offer that's 10%
below what it's listed as you're not
going to get that offer accepted like
yeah I'll write it for you I I'll I'll
represent my buyer clients however it
best serves them but the likelihood
unless your offer is just sweet cash
you know basically no contingencies very
quick closing the likelihood that that
offer will be accepted well below what
it was just listed at it's not very
likely now if the home's been on the
market for a while then you have more of
a likelihood that the seller will
consider a lower offer but right now it
is a sellers Market sellers are testing
the waters with how high can I go and
the result is that they want to kind of
let a listing sit for a little bit
before they're willing to entertain
those lowball offers but the the bottom
line is when you see the Le the list
price that's not
necessarily the best the best offer that
the seller is getting isn't not isn't
necessarily that list price it might be
well above that list price and there is
no way to know a good Agent almost
always will never reveal to other
potential poal buyers what type of
offers they've gotten they might give
little hints but you're as an as a
realtor you're not supposed to reveal a
whole lot of information without the
seller's approval and most sellers you
know don't want that information to be
revealed obviously and so that's
we're a little bit in the dark when
there's multiple offers on what those
offers look like you need to to figure
out what offer you are happy with and
and I and again I say think about at
what price you would be like what you
know top price you would be like you
know what okay I'm still I'm still happy
about this this is still a good deal for
me that is the price you need to be
thinking about in your mind it might be
200,000 it might be 215,000 230 240
whatever the case may be but that's
where you need to to plant your flag and
make sure that
you don't have buyers remorse right
don't don't go crazy and then in the end
be like man I overspent for that I
don't I very rarely have that happen
with my clients because I talk them
through all the different options and I
and I try to structure the contract in
such a way that they get the best price
possible but I hear a lot of stories
of buyers that have buyers remorse
because they just they just LED with
with too much money and they
afterwards think you know what I
probably didn't have to do that
that's something to keep in mind as
well less with regard to purchasing
or selling or whatever real estate
and obviously this doesn't help me at
all when typically when my clients do
this or when people I know do this
but you might consider refinancing right
now right obviously and I'm not going to
spend a lot of time on this I have
done three refinances this year well I'm
actually in the process of my third
hopefully that closing will be at the
end of this this week but on my
properties I'm working on my third
refinance this is listen a great time to
refinance it's taken a while though
because banks are obviously not
prioritizing the refinances they're
prioritizing the new home purchases to
have more of a
deadline but refinancing can get a lower
interest rate if you want to do a
Cash out refinance let's say you have a
lot of equity in your home let's say
that you know your home is worth
300,000 but you only owe $150,000 on the
house you can do what's called a Cash
out refinance take that Equity so you
you have $150,000 of equity in the home
you can probably get 100,000 or more of
that basically the bank to write you a
check at closing and you're basically
re- getting a new mortgage on the
total value which is now $300,000 maybe
80% of that value and now you're in a
situation where the bank is paying you
so it's as if you're purchasing the home
at 300,000 and getting you know a loan
with a 20% down payment that's the way
it is in the eyes of the bank but the
bank is literally writing you a check
and then you can go take that money and
hopefully use it wisely maybe use use
that money to do some house updates that
you've been neglecting for a while
and you will be starting over in terms
of your mortgage but in some cases I
had I did a Cash out refinance recently
that because the the interest rates are
so low my mortgage didn't go up that
much which is crazy it's crazy to think
about right I I got a lot of money at
closing and my monthly mortgage did
not go up very much because of the way
rates are right now so it's it's a
it's a great Market to do a refinance
can obviously also do a home equity line
of credit that's kind of a different way
of skinning that cat you keep your
mortgage that you already have so you
know maybe you you already have a great
rate and you're not really able to
refinance down to a better rate but
you might have enough equity that you
can get a home equity line of credit
it's basically like having a credit card
against your home but you can take that
money out at any time for any reason and
you can pay it back off at any time for
any reason and that just stays there
and you can use it at any time I've used
I've done both of these at different
times for various reasons and they've
both been very helpful very effective
for me for different
things now looking forward to the future
what's going to happen in the future
as far as as as far as the market is
concerned con ered well I don't know
for sure but when Co
ends and when the election season is
over and by the way it is going to be a
season there is not going to be an
election night this year everyone
should be prepared for that there's
going to be mailin voting it's going to
take weeks to tally up there's going to
be all kinds of controversy just get
yourself ready for that we don't know
how that's going to impact the markets
but regardless after all of this is in
the rear viiew
mirror I think that the market is going
to erupt in some way I'm not exactly
sure how but if I had to guess I
would guess it's going to erupt in the
way that a bunch of people are going to
enter the market all at the same time
most likely people that are wanting to
sell and to buy so we're going to have a
glut of new homes come on the market all
at the same time and simultaneously some
of those people will also be buyers I
think you know when that happens it'll
probably flip a little bit more to a
buyer's market but I don't know the ju I
the way I see it it seems like supply is
getting real in in the real estate
market is getting pent up you know all
these people that would normally be
selling right now they're not I have to
think that at some point they're all
going to decide that it's time to sell
and and that's probably going to happen
sometime next year maybe at some
point they have a safe vaccine that
people are taking for covid and we get
that under control I would think at that
point I I just don't see the market
staying the way it is right now I think
it's going to shift at some point but it
seems like it's going to take you
know for us to get past all this covid
nonsense for that to happen and that
seems like it's not going to be probably
until what maybe spring of next year I
think the current conditions that we
have are most likely to continue for
a while because even you know the most
optimistic thoughts that are out there
about a covid vaccine or that there
could be one by the end of this year but
the thing is that they're rushing it
and I'm no expert on this by any stretch
of the imagination but I've done
enough research that it seems like
they're they're kind of rushing through
the clinical trials and whatnot normally
it would take longer than than just a
few months for them to get a a brand
new vaccine to Market and what's going
to happen is the there's going to be a
lot of early adapters to the vaccination
that are going to be kind of almost like
an extension of the clinical
trial and a lot of people won't be
willing to to take that first vaccine
even people that are normally vaccine
positive and so that it's going to
take a while before people are really
comfortable with taking a possible covid
vaccine it's probably going to continue
to take a while before you really get
this under control probably the best
case scenario is if we get this herd
immunity thing which we don't know if
that really happens with Co or not but
that would be the best case scenario
maybe that could happen by the end of
the year but I'm tentatively planning
for the market to really shift in the
spring because I think that that is when
we'll have the election nonsense over
with hopefully will have co under a
little bit more under control hopefully
the economy will have rebounded by then
and then spring is normally the time
here in Greenville you get to the months
of April May June that's when the real
estate market usually really heats up
around here and I think it is going to
be nuts in
2021 and probably it's going to
shift a little bit more in the buyer
Direction at that time but that's going
to be to to the downfall so to speak
in some ways to sellers right now it's a
great market for a lot of sellers unless
you're selling homes that are that are
more expensive so that's a lot to
consider that's just conjecture I don't
know for a fact that that's what's going
to happen but that's my best guess
regardless that is what we're seeing or
that is at least what I'm seeing in the
market right now it is a weird and wild
Market but I'm just thankful for
for the clients that I have for the
business that I've had this year it's
going to be down for pretty much
everyone but that's okay you know
what we are able to weather this storm
and hopefully everyone is being
patient as they wait for the right home
to come on the market and as they
wait for things to to kind of settle
down a little bit but if you need
help with anything in real estate or you
know someone that does please reach out
to me again my contact information is in
the show notes and until next time stay
safe and have a little fun with the last
week or two of the summer
[Music]