Hello everyone and Welcome once again to
another episode of Selling Greenville
your favorite real estate podcast here
in the upstate of South Carolina I am
your host as always Stan McCune and yes I
am a realtor here in the lovely land of
Greenville South Carolina all of my
contact information is in the show notes
I represent investors I represent owner
occupants I represent buyers that
represent sellers please if you need
anything real estate wise I'm your guy
let me know and all of that contact
information is there for you guys to
access and just a reminder as always
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so happy New Year we are now
officially in the year as I said
before we don't want to say 2022 but
nonetheless or 2022 whatever here we are
we're having to say that and
hopefully this will be another good
year year of of real estate hopefully
this will be a year where we can
maybe figure out how to Grapple with
with the pandemic that we've been in
now for almost two full years
nonetheless here we are and so happy
New Year we're going to be talking about
something that I've been thinking
about for a while because you you
guys that know me well know that I'm a
realtor and I'm also a landlord
I also own rental properties I have
short-term rentals I have long-term
rentals I I I have built a little bit
of a rental portfolio over the years and
I I move properties around I don't
you know I sometimes it's best to sell
property sometimes it's best to buy it
just kind of depends on a lot of
different factors but I will always have
at least my plan is to always have
rental properties I I just think that
they are a good investment in enal
you guys know that and
so
I'm looking at the the rental market and
I'm like you know what my gut tells me
that as we're seeing all this
appreciation of real estate as we're
seeing prices go up my gut tells me that
the the price of renting is not keeping
pace and and not anywhere close to it to
be completely honest that was what my
gut told me but I don't like just
relying on my gut I like to look at the
data and so I decided to dig into some
data and I took a single sample which
was my own neighborhood I live in
the Chartwell Estates neighborhood in
Greer and it's a good neighborhood to
operate off of because there are a lot
of homes in this neighborhood I think
there's like 360 homes in the
neighborhood so we have a lot of sales
and also a lot of rentals and so we're
able ble to really get a good sample
size from this one neighborhood and also
it's it's a good neighborhood to to rent
in it's in a a school district that a
lot of people are wanting to get into it
is very Central to to a lot of
amenities you're if you want to
commute to Spartanburg it's near
Spartanburg if you want to commute to
Greenville it's not far from downtown
Greenville you can basically get
anywhere in 20 minutes and so and you
know it's got a pool all these different
things so it it's a neighborhood that
that people want to rent and it's also a
people that that a neighborhood rather
that people want to buy
in and and so it's it's a good
neighborhood on just from a lot of
standpoints to track this I only went
with data from the Greenville MLS
obviously there's a there's limited data
on rentals in there but again with it
being this neighborhood there was more
data in in this neighborh neighborhood
than than most others but that's
where I based my numbers off of strictly
off the MLS I did not dig into you know
any other sources and I'm well aware
that there are plenty of other sources
but what I wanted to look at is
excuse me what I wanted to look at is
the
2-year basically the two-year Trend
and so I pulled data from the entire
year of
2019 and then I compared that data to
the past 6 months both for homes that
are being rented and both for homes that
are bought and sold now I'm going to
perace this with one thing I did not
filter this for single family homes
versus town homes and we do have town
homes in Chartwell Estates so I I
didn't filter that on either side I just
felt like you know what obviously
there's a little bit more desirability
to rent a single family home than there
is to rent a a town home but at
the end of the day Beggars can't be
choosers and I felt like there was an
adequate sampling of of each in both the
six-month data set and the 2019 data set
that I didn't think it was necessary to
filter it out so here is what we
saw we'll start with the the
properties that rented on average in
2019 the properties in chart well
Estates rented for
1607
$1,675 per month and on average that was
a
3.67 bedroom 2 and a quarter bathroom
Okay so let's just say basically on
average three and a half bedrooms 2 and
a half bathrooms okay we'll just say
that for the for the purposes of the
show that was on average and the median
numbers are very close the median number
was 1,600 per month 3 and 1/2 beds 2
and 1/2 baths so that's what happened
that's what the rents were in 2019 well
what were they the past 6 months
obviously they've gone up the past 6
months the average was
1,717 per
month and that and the median was
1,700
50 per month so the average went up
6.81% in the past 6 months of
2021 which is even though we are no
longer in 2021 my my data set came from
2021 basically the last 6 months of the
year we're up 6.81% over the entire year
of 2019 and the median was up
99.38% over the whole year of of 2019
now if that sounds low it it is because
remember we've been saying that home
prices have been going up on average
the past two years about 1% per month
at least and so these have not gone up
in terms of of rental prices anywhere
near that but if you dig into the
data there is a little bit more to
consider than just that so the you'll
you may have noticed I didn't mention
how many bedrooms and bathrooms we were
dealing with well it in general the
properties that people are now paying
6.81% or 9.38% more per month to rent
these are smaller properties now instead
of the average being
3.67 beds and 2 and a half baths now
we're at 3.4 beds two bathrooms and
the median instead of 3 and 1/2
bedrooms 2 and a half bathrooms the
median was only was just three bedrooms
two baths so whereas before you might be
able to get something close to like a
four bedroom 2 and a half B rental in
chart wall Estates for you know maybe
the 16 to 700 $1,700 a month range now
you're looking more at a three bedroom
two B house in the 17 to800
a month range and I and I broke this out
even further let's look at the the three
bedroom averages so the three
bedroom average
house property town home whatever in
Chartwell Estates in
2019 the average was 1,498 so basically
1,500 a month and the median was also
1495 so basically you could rent a
three-bedroom two-b house in 2019 in
Chartwell Estates
for 1,500 a month that hasn't gone up
very much it went up to
1574 on average and the median
actually stayed the same the median
stayed at 1,500 I'm guessing that those
are much smaller in general much smaller
three-bedroom two B houses than they
were in the past the four
bedroom houses on average were in
2019 rented for
$1,716 per month with a median of ,700
per month and that went up between 3 and
4% in the past 6 months to now 1,000
both the average and the median are the
same
$1,772 per month on average and by
median for chart wall estate so
that's an increase depending on how you
look at it VI 3 .25% or
4.26% per month with the entire
neighborhood being in the
6.81 to to
99.38% increase so all that to say
rents have not gone up a whole
lot but the property sizes
have generally speaking it appears have
gone down a little bit the the rental
that you get you can still rent fairly
reasonably in chart wall Estates but
it's not perhaps as big of a house as it
used to be and I think what that means
just kind of as an aside I think that
that means that if you buy a smaller
house in this neighborhood it it will
still rent pretty well you know back in
the day people might not have wanted to
rent a smaller house nowadays you
know it's kind of a Beggars can't be
choosers of situation where they they
might not have any other choice so let's
look at prices right how have prices
changed and this is also this is also
interesting and and a bit surprising
as well few little twists and turns
along the way here so in 2019 the
average I looked at the at the list
price and I looked at the sold price in
2019 the average list price was
basically
$260,000 the median was $240
so we want to look more at the median
that's that's that's more of an accurate
more of an accurate metric
I'll still mention the average but
when we're looking at when we're looking
at sales we we want to focus on the
median which we've talked about in the
past this the average sold price was
down a little bit off the average list
price the average sold price was
26,700 the average and the median
sold price was exactly what the list
price was the median was 240,000
and our sold price per square foot
was right in the
$98 per square foot range okay tracking
with me how did that change well
interestingly the the average sales
price did not go up that much the
average sales price went from
2567 to
263 what is interesting is that the
average list price actually went down so
we actually saw the average list price
go in 2019 from 259 to the past or you
know a little bit more than 259 I've
rounded up to 260 before in the past
6 months the average was 257 or well
really 258 257 980 we'll just call it
258
so that actually went down but then the
sold price was higher than the list
price which we've talked about in the
past so so those are some some
interesting little tidbits now looking
at the median which is a more accurate
again a more accurate way of looking at
this the median price went from median
list price in 2019 was 240 and the
median sales price was in the past 6
months was
245 the median sold price this is this
is kind of a crazy thing which in 2019
was the same as the list price 240 the
median sold price was
270 which is okay so that's not a big
jump but what's crazy to me is that the
median list price was 245 and the median
sold price was
270 way way above what you know
people are are purchasing the homes in
Chartwell for in the past six months for
way above what they were listed for so
that's that's a fascinating metric but
it's
surprising that the average sold price
was only up
2.45% in the past six month in the last
6 months of 2021 versus the entirety
of 2019 and the median price was only up
12.5% the median sold price
12.5% we would expect those numbers to
be substantially higher given that these
numbers are that that these homes are
you know really relatively cheap cheaply
priced given the market and additionally
that that the market has been increasing
for the past 2 years by you know
generally speaking about 1% and
sometimes in some cases more per month
so what are we missing here what we're
missing is the price per square foot and
that's a very important detail remember
I said that the that the sold price per
square foot in 2019 in Chartwell was
about $98 a square foot that number in
in 2021 the last six months of 2021
was
143 that is an increase of over
45% so
actually really the the pricing
doesn't matter at all people are buying
basically the bigger homes in Chartwell
Estates simply haven't been sold as much
as as they were in 2019 and now
basically all the homes being sold were
smaller homes for the same prices and
for a little bit more than the bigger
homes were just a few years ago so a
jump from $98 a sare foot to
$143 a sare foot that is an absolutely
insane jump
45% so what do I gather from this
rents are not coming any anywhere close
to keeping up with with sales and
that is great if you are a renter or if
you're contemplating renting that's a
really good sign you are probably not
going to just get immediately priced
out now at some point this has to
correct right at some point the the
rents are going to go up it is only a
matter of time it it has to happen
like the the money can't just money
doesn't just grow on trees and when home
when the prices of homes are going up
the prices of rentals are also going to
go up but this explains the fact that
that these that the sales price stayed
relatively close didn't go up by that
much I mean it went up by 12 a half%
that explains why what we've been
talking about which is that smaller
homes are now more what are being sold
for just a little bit more than what the
bigger homes were a couple of years ago
and I think the rental properties are
reflecting that as well the rental
properties now are smaller they're not
that much more expensive but they're
smaller than they used to be just a a
few years ago in fact even the the
four bedroom sample size from my rental
property search did not have any
half BS half boms are a really good
metric actually to determining the
size of of a house because a a four
bedroom two-b house is typically
dramatically smaller than a four-bedroom
three b or a four-bedroom 2 and a half B
house because if they really Builders
really and and homeowners really want to
fit that half bath end somewhere that
Powder Room in so that you don't have
you know people that need to go to the
bathroom don't have to go into a room
that has the shower or the bathtub it's
really inconvenient in a lot of ways
and so if they can't squeeze that in it
tends to indicate that it's a smaller
house and that is exactly what we're
looking at in these numbers the the
average four bedroom house that was
rented in Chartwell in 2019 was 4.3
bedrooms and two and a half baths
whereas the average house that rented
for about 4% more was was only
four bedrooms and two bathrooms and
so
rents are staying a little bit flatter
than we we would expect them to but the
homes are
smaller pricing is staying a little bit
flatter than we would expect it to but
the homes are smaller and that and the
price per square foot is
skyrocketing and so these are all
very important details to to consider
all in all I think that that this is
going to have a a profound impact on the
market what what I'm curious to see is
once some of these bigger homes in
Chartwell start going back on the market
what will happen I don't think that
owner occupants will be able to rent
them out I I I don't think so I think
that these will have to be sold and
there's been some angst because I know
this because I live in this community
some angst about how many properties in
Chartwell are rentals well I think we're
coming to the end of that I think that
that is part of what I'm reading in this
data is that Chartwell will not be able
to afford rental properties for much
longer people that are looking to
purchase rental properties they have a
short window of opportunity before they
are priced out of Chartwell Estates
and that may go for the broader
Riverside area of Greer who knows we
have to again as I always say we have to
follow all of this data closely and
it's all worth
considering Short episode today but
that's all that I have I thought it was
a very interesting study an interesting
data set to look at hopefully that
will help you to better understand how
the rental market compares to the the
sold market and how that has changed
over the past couple of years and if you
did like it please hit that five star
button rate the the the episode and the
show with a high rating I appreciate
that if if you guys do that if you can
leave me a review I would also greatly
appreciate that subscribe download the
episodes and all of my contact
information as always because I'm a
realtor and I plaster my contact
information everywhere it is in the show
notes reach out to me with anything that
you guys need and here's to the year of
Our Lord 2022
[Music]