Hello everyone and Welcome to another
episode of Selling Greenville your
favorite real estate podcast here in
Greenville South Carolina I'm your host
as always Stan McCune realtor right here in
the Greenville area you can find all of
my contact information in the show notes
if you need a realtor in Greenville or
in the Greenville area in Spartanburg
and Anderson and Easley all these areas
around Greenville I can help you out I'm
your guy please reach out to me all of
that contact information is in the show
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today is an unscripted podcast for me
where I'm just going to kind of just
discuss here as we are ending the year
ending 2022 and going into
2023 I want to just kind of say what I'm
thinking just what I'm thinking in terms
of of reviewing the past year and
looking forward into the next year I
literally have done basically no prep
for this podcast of course I'm recording
this the day after Christmas kind of a
kind of a crazy week getting ready for
Christmas and all of that so you
please forgive me if I'm a little bit
scatterbrain in this show but this
was kind of what I plan to do all along
for this episode was to just kind of
talk about what I'm seeing what I have
seen what I anticipate for the upcoming
year so let's just start real briefly by
talking about what 2022 was like 2022
was a tale of really two years baked
into one and it all comes down to
mortgage rates when mortgage rates went
overnight basically I mean it feels like
overnight from being in the threes to
being in the six and sevens
that completely changed a ton in the
real estate World obviously the
beginning of this year very very busy
the first half of this year super busy
for everyone the latter half of this
year and particularly the last quarter
it has slowed down a lot for everyone
and specifically for me with my business
as a realtor I'm seeing a lot more
activity amongst investors than what I
have seen the previous couple of years
and really a a lot of people that were
in buy mode for or potentially
looking to move a lot of those people
are just kind of in wait or appear
appear to be in wait and see mode trying
to figure out okay what's going to
happen as we go into the new year are we
going to see rates come down are we
going to see a recession are we going to
see prices go up or go down a lot of
people just kind of staying tight and
just kind of waiting and seeing what is
going to happen and so as a result
really everyone is seeing the market
slow down right now and I think I've
mentioned this before on previous
episodes but we're seeing just any
sort of like mail that's coming from
like birkshire hathway home services
corporate which is I'm realtor
with cdan Jord Realtors which is a part
of the Burkshire hathway Home Services
Network
emails are coming from them that are
saying how to prepare for the upcoming
recession my company you know recent
meeting was all about a companywide
meeting was all about how to survive the
the upcoming months there's a lot of
trepidation out there in the realtor
world right now because we know what's
going to happen we know that there is
going to be you know we've had a few
very fantastic years of real estate from
a realtor perspective but this is
going to be that was the feast this is
going to kind of be the real estate
famine as it were potentially these
upcoming months maybe even years we
don't know that's that's where the
trepidation comes in and as we're
looking forward to
2023 a lot hinges on whether we go into
recession and I think most experts
anticipate that there will be some sort
of a recession and so perhaps maybe I
should phrase it differently that a lot
comes down to not just whether we have a
recession but how bad is it you know I
saw recently Elon Musk whatever you
think about him this isn't a podcast
about him but he thinks that we're going
to have a severe recession coming up
here in 2023 I've seen others that
are kind perhaps more experts on the
economy than he is who believes that
we will have a mild recession that we
will have some sort of a recession it'll
be mild I've seen others that think you
know what hey it's going to the economy
is going to slow down but we're not
going to have your traditional sort of
recession so there are several different
schools of thought right now and all of
these things directly impact real estate
because obviously when unemployment goes
up that means fewer people can buy
houses
and also if we go into recession that
could then signal the FED then
lowering interest rates because they've
been raising them in order to combat
inflation and if that happens then we
could see mortgage rates come down as
well either way I think that there is
a really good chance that mortgage rates
do come down pretty substantially here
in the next year I think that they're a
bit artificially inflated I'm not going
to get all into the weeds on that but
basically in a normal environment even
with what the FED has done we would
expect mortgage rates to be more in the
fives rather than in the sixes I
think lenders are being very
conservative right now and I wonder if
once we get into
2023 if that will change a bit once we
have more of a sense of what the
economic climate is and so this leads
me to kind of what I'm thinking
personally going into 2023 here's kind
of what I'm expecting I'm expecting the
winter months to be pretty slow I think
that that's just going to be what's
going to happen we're not just having
fewer buyers which is to be expected but
we're also seeing fewer sellers I'm
looking at the market stats that were
published by the greater Greenville
Association of Realtors earlier this
month earlier December
to cover the month of November we're not
going to go through these in as much
detail as we typically do but one of the
pieces of data that really stood out to
me was that new listings for November
were down year on-year by
6.6% that's interesting because we
already know we've already been talking
about how closings have been down
closings were down for November
18.5% year on-year the the largest
decline that we've seen in quite some
time
but what we're seeing here is
both buyers pulling back so both demand
lessening but also Supply is lessening
so what we have is fewer buyers and
fewer sellers and that might seem
at first glance to be like okay yeah
that that's normal because a lot of
people that are buying are also selling
well actually traditionally they are
tied together to a certain extent but
often times one of them kind of stays
more constant while the other one
really shows bigger increases or
decreases right now we're just seeing
big decreases on both sides on both the
buyer and the seller end of things so
that just means that the market is going
to slow down it makes it difficult
more difficult if you're looking to sell
we are still in a more of a sellers
Market type of environment obviously not
what it was a year ago but but it's
still more of a sellers Market than a
buyer market for
sure but what we're seeing is it's
more difficult to sell than it was a
year ago but it's in a lot of ways
more difficult to buy as as well you
would think okay with the market
correcting it should be easier to buy
right well no not if fewer people are
listing their homes for sale that just
exacerbates the issues that we've
already had of supply and demand being
out of whack if demand goes down but
Supply also goes down then you still
have the problem of you know whereas in
the past supply and demand were really
high so you had a lot of Homes at your
disposal that you might be interested in
but you were constantly getting out bid
for them well now the issue is there's
just not a lot of homes for sale and so
you're not even finding homes to even
make bids on that's what we're seeing a
lot in this market right now I
predicted this a while ago but the homes
that or fixer uppers that are that are
listing on the MLS that aren't
listing for dirt cheap those homes are
not selling you cannot just list a fixer
upper and expect someone to come along
and buy it and fix it up on their own
dime people are expecting things to be
nice to look nice to be
TurnKey and this is how the market is
Shifting now what I think is a very
good potential outcome I'm not going to
guarantee it but I think what we could
see is mortgage rates coming down at
some point in the spring or summer and
what I think is going to happen is that
the market is going to knee-jerk there's
going to be a knee-jerk reaction that's
going to happen as a response to those
rates coming down because what we've
seen the past 2 to 3 years has been
unlike anything I've ever seen I've been
a real estate investor since the early
2010
and I've been a realtor now for
almost 7 years what I have seen is
unlike the past couple years is unlike
anything that I have ever seen before
which is that normal retail buyers and
sellers of homes in other words
homeowners looking to potentially move
they are treating real estate in a sense
like the stock market the real estate
has become it's always been to investors
kind of like the stock market right but
more so than ever to non-investors of
real estate to people just looking to
buy or sell their own personal home real
estate is becoming similar to the stock
market how it's because people are
monitoring these things like these
mortgage rates and are having knee-jerk
reactions to them so we just saw this
recently because mortgage rates went up
into the sevens and then they
immediately receded back down into the
sixes when they receded back down into
the mid to low sixes IM immediately
mortgage applications went up Nationwide
I'm not saying specifically in
Greenville I'm saying Nationwide we saw
that
happen and so people I think if
those mortgage rates if if it falls back
into the fives I think people are going
to panic and be like okay we got a
strike you know mortgage rates may go
back up and they're going to panic
and mortgage applications are going to
go up people are going to start looking
at housing again and if it coincides
with what is normally the busy season
anyway we could see a big spike happen
in the spring or summer I think that
there's a very good chance that that
does happen now on the flip side like
I said a lot hinges on whether we go
into some sort of deep recession if that
happens then all bets are off but for
me personally I believe that the
Greenville Market is resilient the green
Ville Market and in in really South
Carolina as a whole I published on my
Facebook page recently some stats that
basically broke down a bunch of
different markets I think there were
like 30 or 35 different real estate
markets and how much of a drop off
there's been in closed sales for all
these different markets and South
Carolina had the second least drop off
in other words it was the second most
resilient area and included some
states and some Metro areas the second
most resilient in terms of closed sales
so so it still had a big drop off I
believe the number was was 28% was down
28% but in comparison to some of these
other markets South Carolina was a
lot more constant and this is this is
what we see in the state and this is
what we see in Greenville as well we're
seeing this with pricing I been
saying on this podcast I'm closely
following the medium price point to see
if it goes down seasonally below what I
would expect it to
seasonally we always see median price
points come down this time of year and
that's for a variety of reasons it
doesn't necessarily mean that real
estate is getting cheaper part of the
dynamic there is fewer expensive
homes pricier homes fewer of them are
going under contract and selling this
time of year but generally speaking we
see a little bit of a dip in the median
sales price and what I've been watching
to see is if that dip goes below 285,000
if it did that then to me that indicates
for a variety of reasons that we're now
seeing prices go down in comparison to
the normal seasonal averages well in
November it actually went up month- on
Monon from October to$ 303,000
240 that was an increase month-
on-month it was an increase year on-ear
of 6.4% now
6.4% that is the lowest increase year
on-ear that we've seen in a very very
long time and that number now is
starting to look very comparable to to
what prepandemic sales price
appreciation looked like so we are
starting to see things normalize a bit
but what we're not seeing yet is that we
are shifting into a buyer Market or that
we are shifting into prices going down I
keep seeing people wonder and ask our
prices going down that hasn't happened
yet and with sellers now pulling back
and with Supply now being pulled back
off of what it could have been I
think that that's going to cause prices
to probably stabilize a bit here versus
actually seeing prices go down depending
on where you stand whether you're
wanting to buy soon or sell soon that
might be good news or it might be bad
news but I think it's probably better
for the market as a whole to have a a
gradual slowdown than a complete
flipping of the market we've already had
enough of a flip that has happened
the past several months mons so I
think if we if we did the full flip from
a full-blown sellers Market to a
full-blown buyer Market I think that
that would be an incredible System Shock
that would leave a lot of people out in
the cold both literally and
metaphorically so I think it's best
if we have this more gradual slowdown
that we're seeing but my point is that
we are not seeing at least not yet
prices going down in a way that is
outside of what these seasonal norms for
the Greenville Market would be at least
the way that I understand it so we have
an
interesting Dynamic at play here where
if we look into the future I think we
could have a very slow first quarter of
real estate for this year and I think we
could have a very busy second and third
quarter if things play out right and I
think that there's a very good chance
that things do play out in that way
so these will be things that we'll have
to monitor very closely for
2023 but for me you guys know if
you know me that I have rental
properties I flip houses on the side
it's not something I necessarily enjoy
doing but it's something that I have
carved out a niche for and it's
something that I'm good at and so I
stick with it I'm not a High Roller in
terms of you know flipping incredible
volume I I've met with someone recently
that is currently flipping 15 houses
right now I I don't do that type of
volume I I'll usually take one two three
at a time if that but right now I am
in buy mode because I truly think that
there is some opportunity specifically
right now if you can find those
opportunities but I'm I am personally
seeing opportunities on the investment
side of things that I haven't seen in
years and that has me very excited a and
it's an indicator that investors right
now are and and I'm seeing a lot of
indications of this but investors are
playing it very safely right now and so
for those that want to invest in real
estate and are willing to be aggressive
this is a very interesting time to be
aggressive and I and I'm choosing my
words carefully because I can't give
investment advice but for me personally
I find this to be a compelling time to
invest even on shortterm things like
house flipping because if if the
scenario that I'm outlining is correct
then properties that you purchase now
and then flip in the next couple of
months those could be hitting the
market right around the time that the
market really starts to heat up and it
should I mean again what's weird about
what has happened right now in in the
current market is that we had all of
these interest rate hikes at the same
time that we have the normal seasonal
slowdown so parsing between what is
seasonal versus not seasonal is all of
the game right now but what we know
for for sure is that seasonally we will
see things kind of bottom out this time
of year right these next few weeks are
always the bottom of the real estate
year right and then in February it
starts to tick up in March it starts to
tick up and then April it really ticks
up and then we've got that April May
June crazy season of real estate that we
have every single year and so even if
the market is still suppressed right
even if we still have less of a of an
excitable real estate market than we
have in the past and we for sure it for
sure
2023 isn't going to look like 2022 or
2021 or even 2020 type of of numbers
it's just not we're not going to have
those types of closing numbers that we
had in those years but whatever 2023
looks like it's going to be those spring
and summer months that are going to be
the busiest of the entire year unless we
have some kind of a very bizarre
scenario where the FED and and
Banks end up dropping rates way back
down into like the the threes maybe the
fours again I don't see that happening
this year so I think that we'll just
see a normal seasonal slowdown perhaps
obviously it's a little bit more than
seasonal right now and we'll have the
the normal seasonal build and what could
happen is that normal seasonal build
that happens into the spring and summer
could actually be increased by the fact
that mortgage rat could be coming down
around that same time so it could have
kind of a cascading effect so that's
what has me interested about buying now
I think that there is kind of a unique
window of opportunity for less
competition even if that also comes at
the cost of there being fewer houses
to look
at and so that's kind of where my headp
space is right now going into 2023
specifically in the Greenville Market
remember I always say this
any opinions that I have about real
estate the they are Greenville opinions
I don't know anything about real
estate in San Diego I don't know
anything about real estate in Chicago or
New York or any of these other places
Texas I do real estate is very local and
very Regional I know Greenville really
well I don't know you know if you're
listening in in from another Market I
can't speak to what your Market is going
to do in 2023 and as it is I'm I'm only
giving my best guess as to what is going
to happen in Greenville in 2023 but I
have a pretty good track record you guys
can go back and listen to old episodes
the sound quality might not be as
good but you can go back and listen
to those and and see that generally
speaking I have a pretty good track
record when it comes to making these
predictions and I'm and I feel
I feel good about what I'm seeing
right now in the market and what that
means for the
future m I'm not worried about what's
going to happen in real estate this
upcoming year I think that there's is
going to be a a lot of exciting
things and for me as I already said I
have a lot of my investor clients right
now coming online that have kind of been
offline for a while and that's one
thing that I have worked on so much over
the years and has been a big niche of
mine is working with investor clients so
I am Diversified in terms of my real
estate work and in terms of of my
client base and so that really has
helped me over the years to weather the
storms because real estate fluctuates
greatly and we had a a period in 2019
where this happened where things started
to kind of decline faster than we
expected it to seasonally and people
were were kind of bracing for a
recession then and guess what then Co
happened we thought okay real estate
might be deemed
non-essential we might be in real we
might be out of work and instead the
opposite happened instead real estate in
South Carolina was deemed essential
and then it just took off and it just
resulted in a crazy couple of years
so it's really hard some of these things
are really difficult to predict at the
end at the end of the day but I feel
honestly really excited about what the
future brings I think that a lot of my
buyer clients are going to find some
good opportunities and I think for those
that are kind of on the fence with
whether to buy or not I think the
conventional wisdom out there is that
rates have come at or near their top and
that they are most likely going to come
down at some point here in the future
and so what that means for a lot of
people is that that this might be
this could be the best opportunity to
buy while competition is light and you
might have a higher mortgage rate right
now but then you have the opportunity to
refinance in 6 months or a year or a
year and a half some new home
builders are offering low interest
rates for people that
are willing to to purchase their
inventory because home builders have
gotten crushed by this Market shift
right now so i' I've seen some home
builders that are offering an
introductory mortgage rate for the first
year of
3.99% and then that goes up in
successive years but the the thinking
is that if you lock it in for that first
year at
3.99% and then a year from now or
perhaps two years from now you'll have
that opportunity to refinance to a a a
locked 30-year rate that'll be probably
in the in the fives perhaps in the fours
and so there's a lot of interesting
things out there by the way I represent
clients with new home builders as
well that most new home builders the
vast majority of them are willing to at
no extra cost to the buyer allow them to
have a realtor and then trust me you
should have a realtor when you're
purchasing new construction there's a
variety of reasons for it but the
builders will there's a lot of
subterfuge that happens with new home
construction and they won't tell you the
whole story having someone on your side
is helpful so that's just an aside um if
you're looking at new construction I for
sure can assist you with that and it
will almost certainly come at no cost to
you because these Builders unless it's
Ryan Holmes Ryan Holmes um they don't
like to compensate Realtors but um I
have other opinions on Ryan Holmes that
I'm not going to share right here
right now so we can talk about that
later um but anyway long story
short I feel great about 2023 I think
there's a lot of exciting things I think
the market is going to slow down but
that's okay um that doesn't mean it has
to be a bad year that just means it's
going to be a different year and I'm
really excited to work with you guys in
the future so please contact me for any
of your real estate needs my contact
information is in the show notes if you
need to reach out to me for anything
please subscribe subcribe to the show if
you like it and if you love it leave a
rating leave a short little review I
would appreciate all of those things hey
we're about to enter the new year so I
want to wish you guys a very Happy New
Year I'm looking forward to a prosperous
2023 and next time we talk it will be
the year
2023 so until then stay safe don't do
anything crazy with any fireworks don't
do anything crazy on New Year's Eve
we'll talk again next time
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