[Music]
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 Stam McCune realtor right here in
the upstate of South Carolina lovely
Greenville itself you can find all of my
contact information in the show notes if
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10 seconds out of your date to do that
I would really appreciate it I want
to today to take one final look back at
2022 because the greater Greenville
Association of Realtors just released
their Market stats for December of of
2022 and as we typically do typically
during a normal month we review the
stats once they get released by The GJ
and I would like to do that because I
feel like there are some interesting
little nuggets get in there but first
before I get into that I just want to
give kind of a general observation that
I'm seeing right now in this market
obviously we're experiencing shifts it's
been shifting now for for the better
part of the past six months but where I
think I'm seeing the biggest shift right
now is in how buyers are just
approaching the market as a whole and
what I mean is this what what I'm
consistently seeing is a home comes on
the market buyers are really interested
in it and it gets a lot of activity
but now people have gotten so worn out
from the past two years until recently
of bidding wars that now the inventory
numbers are up and there's fewer bidding
war type of situations happening it's
becoming kind of a self-fulfilling
prophecy because people are now just
waiting they're not even making offers
on some of these proper because they
want to avoid bidding wars and so
they're just kind of you know they
they'll look at the house and then
they'll just be like okay let me
think about it and then and then you
know they'll wait a week and then maybe
at that point they'll come back to it
and say okay I want to put an offer
now actually had this happen with
one of my clients recently they they did
that they looked at a house and they
decided to wait on it and then a week
later came back to me and by that point
it had already gone under contract
but this house had been on the market
for for a few weeks so there's a pretty
good chance that the person that got it
under contract also had waited for
some time as well so it's a very
interesting Dynamic I think that
everyone is trying to figure out what
this new normal looks like this new new
normal right because whatever this is
we've been talking about in this in
the show about going back to prepandemic
Norms right that's been kind of what
what we've kind of been assessing a lot
of things off of and I think what I've
realized is that there is no going back
to pre-pandemic Norms in the real estate
market that is not going to happen we
have we we were talking you know the the
trendy thing to say was The New Normal
you know in real estate following the
pandemic when things went crazy well now
I think we have a new new normal and
it shouldn't be surprising because prior
to the pandemic mortgage rates were
you know close to to two points lower
than they are right now and a lot of
other numbers were similar but that twoo
difference in mortgage rates that's a
massive difference and there was a
possibility that had the pandemic not
happened that rates would have ended
up you know going over five 5% I know
my broker at the time fritzy Barber
who's no longer with us
she predicted she thought that they were
going to go over 5% you know before
the pandemic happened so we may have
ended up seeing something like that
regardless but we'll never know because
it just didn't happen the pandemic kind
of threw everything for a loop so
long story short we're seeing buyers
shifting in their behavior in in very
interesting ways and I really in my
opinion and I keep hearing people saying
I don't want to get into a bidding war
situation and so because of that fear
of getting into a of of of being in a
bidding war situation people just aren't
even putting in offers they they
wouldn't even be in a bidding war
situation because there's no offers
coming in until a week or two later
so what I would encourage my buyers
and and you as listeners if you see a
property that you're interested in that
that fits what you're looking for go
ahead and and Go For It Strike m if you
think if you say well there's going to
be a lot more homes coming on the market
no inventory is is going down and we're
going to see that here with some of
these Market stats so I don't I
don't encourage anyone to I don't want
to encourage someone to overdo it and
to be too aggressive right this isn't a
market where you need to come in and
offer 20,000 above list price like you
like you used to do like used to have to
do but at the same time waiting just
to avoid a bidding war might actually
have the opposite effect of what you're
trying to do there's nothing really
the the only downside of a bidding war
at the end of the day is just getting
emotionally invested in a property it
really does not take me that much time
to write up the paperwork it takes
me some time to to do the requisite
research to kind of tee up everything to
make sure that there are no blind spots
that we have but for you as the consumer
the purchaser of real estate once you've
seen the property done the showing and
all of that there's really not a whole
lot more that's required of you
besides just in theory keeping your
emotions out of it so that when you
submit an offer if it does go to a
multiple offer situation you're okay
with that and I know that's a hard thing
to do real estate is very emotional
I'm not telling people to to turn off
their emotions I'm not trying to
gatekeep emotions as as some people
might say there's no gatekeeping on this
on this podcast but if your if
your main concern with a multiple offer
situation is is the the bad feeling
of losing out I will try to to help you
with that and I just encourage anyone
out there if you're looking at real
estate if you're interested in in a
property don't let the fear of the
multiple offer situation prevent vent
you from potentially submitting an offer
all right with all of that now out of
the way let's look at the final endof
year numbers the greater Greenville
Association of Realtors published when
they came up with the December Market
stats now just a reminder as always
there are some stats that for whatever
reason are always in accurate for the
the most recent month I will navigate
through that I'll let you guys know
which stats those are but for the most
part these stats are typically Fairly
reliable there are some instances
here and there they they they do get
tweaked kind of as the year goes on so
they're not you know sometimes some of
these stats will go up and down by by
I don't know let's call it 5% here or
there but for the most part these are
going to be pretty accurate so let's
start with new listings and just a
reminder is
always we look at year onye the the the
most important thing is looking at these
stats year on-ear but at the same time
we do have some month-on-month
considerations as well so there are some
interesting things from a month-on-month
standpoint that I think are worth
talking about in certain
circumstances so for the month of
December new listings were down
177% year onye more substantially they
were down well I don't even know the
percentage but they went from November
1300 1,00 sorry
1,314 new listings to December was
down to 940 new listings we went below
1,000 new listings for the first time
for the first time since 2019 so that is
a pretty pretty tremendous drop now
that was 2019 that was the month of
December I believe that it that it
went down below 1,000 listings and
actually pre pandemic it was really
common that we would see things drop
below 1,000 listings in the month of
December that actually was a very
consistent Trend going all the way back
to to 2010 so we are seeing a
reversion to pre- pandemic but as I
said before nothing is the same as pre
pandemic except some things on paper and
so where we see this inventory or we not
yet in inventory but where we're seeing
new listings dropping the thing is that
demand is still higher than it was
several years ago and so we're seeing
the market kind of
overcorrecting for What's Happening Here
we still have fairly low inventory but
fewer people are listing their homes for
sale we've talked about that before
we've been talking about that every
month it's a phenomenon that's
happening for multiple reasons one of
the main on ones being that people that
are locked in to a 3% mortgage rate
they're not going to move and double
that mortgage rate to go up to 6%
they're just not it for most people it
doesn't make sense to do that and so
unless mortgage rates come back down
quite a bit we're going to see low
listing levels for potentially for years
right because again who is going to be
incentivized to leave behind a 3 %
mortgage rate when rates are so much
higher it's going to be really really
hard for people to do that so we're
we're looking at I believe an
extended period of low inventory here in
the upstate of South Carolina and
probably probably for the most part
Nationwide although there there are some
markets that are that are are
operating a little bit differently but
for sure in the upstate I anticipate
that pending sales this is one of the
ones that tends to not be accurate for
the most recent months so it says
that pending sales were down 49% year
on-ear for December I'm just going to
ignore that for now because we need
to go back to November because
November's numbers last month were were
way off so November of 2022 pending
sales were down 33% year on-year massive
massive decrease and it was below a
th000 and it went below a th000 again
for the first time since
2019 so another reversion back to
pre-pandemic Norms it so it was
913 pending sales which is the count of
properties on which offers have been
accepted in a given month that was down
from the previous year which was
1,362 for the month of of November
2021 now these numbers are saying
that December was down to 548 pending
sales I can tell you right now that's
way too low this number is always low
for some reason reason when they when
they published this based on
historical Trends I would guess that
that number is going to be either in the
high 800s or low 900s so still very very
low and and and so that's what I
think is going to happen however
December of 2022 was only 1,77 so the
percent if I end up being accurate
and it ends up being in the High mid
let's just call it mid 800 to low 900s
is what I where I think that's going to
end up being then the percent
decrease won't be nearly as much year
onye as we saw in November but I do
think we'll see a month-on-month
decrease in pending sales we'll have to
wait until January Market Stats come out
which won't be for another month and
then we'll go back and look and see what
the December pending sales numbers were
closed sales but by the way of
course the important thing about these
pending sales being low is is this sets
us up for the future month's close sales
so seeing November pending sales being
down below a
thousand that just means that now we're
setting ourselves up for a very slow
winter because those pending sales turn
into closed sales in the following month
and that's exactly what we saw we saw
closed sales for the month of December
go down 24.5% year on-ear so it was at
1,221 versus the previous year is
1,617 however I want to say those
numbers for December of last year were
insane like that was not a normal by any
stretch of the imagination that was not
a normal December what we had in 2021
so I'm I'm not going to draw too many
massive conclusions from closed sales
being down 24.5% I think that's actually
those closed sales numbers are actually
higher than I would expect them to be it
was actually increased month- on-month
versus November which was
1,197 so I think that that
honestly that's a a fairly strong number
even if it was down year on-ear that
being said as I just noted pending sales
are really low so I would anticipate
once we get January and February closed
sale numbers they're probably going to
be quite low days on Market until
sale this we I've been talking about
this a lot we're going to see this
number Skyrocket I don't remember what
my prediction was last month I
think I predicted that it would go
into the high 30s I think but it
surpassed my predictions it went up to
43 days on Market until sale now this
is the average number of days between
when a property is listed when an offer
is accepted in a given month and
here's the thing what I've been what
I've been saying is that we're going to
see this number Skyrocket at some point
because there are some homes
particularly new construction that are
just sitting and have been sitting for
months and when those sell those are
going to cause this number to absolutely
Skyrocket and so that's what we're
seeing we we're we're starting to see
the number Skyrocket because it was 35
days in November and now it jumped up to
43 days in December and that is a 59.
3% increase from December of 2021 which
was only 27 days how does that
compare historically well pre
pandemic the norm was usually in the
50 to 70 days on Market range and
again this is an average so it's not not
necessarily that you know even pre-
pandemic we still had multiple offer
situations properties going you know
selling in one or two days or whatever
like that's always been the norm even
during the Great Recession that would
happen but looking at the averages
kind of helps us to kind of gauge where
we are in comparison to other markets
43 is still very low that is still
historically very very low but now it's
starting to look more like what
prepandemic was actually in in
2018 we had a stretch where we were kind
of in the low 40s and then that
jumped up a little bit in
2019 as mortgage rates started to go
up so there there is a direct
correlation here between days on Market
until sale and and mortgage rates
median sales price all right this is one
that we have been tracking very closely
as I have said repeatedly on this
podcast if I saw the median sales
price in Greenville go below
285,000 that would tell me that we are
for sure seeing
prices drop below what the seasonal Norm
would be so we typically see median
sales price drop this time of year
that's just part of the seasonality of
the market part of that is there's
not as much buyer demand and so it so
homes can't command as much as they
would at other times of year but also
part of it is just the more expensive
homes not not being sold and and and or
not going on the
market so for December of 2022 we saw
the number decrease down to
296,000 which is a 2 .7 % increase
from December 2021 which was
28826 this is our lowest percent
increase in a very very long time
2.7% now that isn't that unusual for
Greenville that would that would be a a
pretty standard year-on-year type of
type of increase for the Greenville
Market which is a more stable Market
than many but in comparison to I mean
I'm still looking at in may we had a
20.5% year-on-year increase April was
19.7 March was 17.3 February was 20.8 I
mean we were seeing 20 plus%
year-on-year increases in the median
sales price for for several months
out of the year and now it's dropped all
the way down to December being only a
2.7% increase we're starting to really
knock on the door and and
my
$285,000 figure that I came up with
whereby I would determine that the
market is kind of Contracting and
we're seeing prices go down at a
non-seasonal rate that wasn't an
arbitrary number that was based on
Research that I had done on a standard
seasonal medium price drops that
we see in this market but that being
said there is still a margin for
error in there is the number really
290,000 ,000 is it is it really 280,000
what I'm trying to say is the fact that
we're now at 296,000 for the month of
December we could pretty much already be
there so that's something to that
obviously we need to continue to keep
track of and we could absolutely see
a situation where very soon sales
prices median sales prices are below
what they were in
2021 now does that mean that we were
in some sort of a recession or something
like that no I I need to remind you guys
now I'm not saying that we won't go into
recession in fact I have predicted that
we will go into a mild recession I had a
bold predictions episode
recently
so let's let's not hear this as me being
overly optimistic oh we're not going to
go into recession but it's not uncommon
if you look at the Historical Trends
there are sometimes months that you
can look at historically where the
year on-year medium price was actually
down from the previous year sometimes
weird things happen particularly in the
winter when buyer demand just cools
off and and like I said when more
expensive homes are just not selling as
much where we can see the occasional
year on-year drop for for one or two
months but then the trend once the year
is all said and done the the trend is
that there was an increase by usually
somewhere between 2 to 6% the
increase in 2022 for the entire year was
14% so we saw home prices go up
14% for for the the month of sorry
for the year 2022 versus
2021 average sales price I'm not
going to really get into that that's we
don't talk about averages as much
because that's skewed by the most
expensive and the cheapest homes that
are sold but if you're curious the
average sales price for December was up
6.4% up to
351,000 however from a in compar in
comparing that to the rest of the months
of the year that was actually the lowest
number that we've seen since February
so take that for what it's worth which I
don't think it's worth very much
percent of list price received this
is one of the more jarring numbers on
here so this is a percentage found when
dividing a property's sales price by its
most recent list price than taking the
average for all properties sold in a
given month not accounting for seller
concessions so again I have to say
this for people that may be new
listeners what that means is that we're
looking at the most recent list price so
this doesn't account for Price drops and
right now there's a lot of price drops
it also doesn't account for seller
concessions closing costs Etc that are
paid by the seller right now there's
a lot of closing costs a lot more
closing cost being paid by the seller
than there has been the past two
years so this number went down 2.4%
year- on-year it was the percent of list
price received in December of 2021 was
an insane 100.3 3% in other words the
average listing was getting over what it
what it was listed for which we
all knew that that wasn't going to
remain the same for a very very long
time we saw that number hover around
98% and we finally saw it start to
get into that range around well in
August it went down to 99.6% and then
it's been steadily going down until
December of this year when it went down
to
97.9% this is looking very 2019 is if
that makes any sense that that was that
would be a number that we'd very much
expect to see back then but this is a
more staggering number when you consider
that again it's not accounting for
Price drops and it's not accounting for
seller concessions so even though
it's 2.4% lower on paper year on year I
would say it's probably closer to 5%
lower year on-year if you accounted for
those other things
because when you're
selling obviously it's a really big deal
what you listed it for originally like
did you have to drop the price if
you're having to pay $5,000 in buyer
closing costs like that's real money
coming out of your pocket like you you
you're considering that as part of the
transaction and unfortunately we
don't have GG does not track that for
us but the if we factored all of that
in I would expect that the real number
would be at least double
the the difference what than what we're
seeing here housing affordability
index this is the the index where 100
means that essentially the median
household income is exactly what's
necessary to qualify for the median
priced home under prevailing interest
rates so we like this from an
affordability aspect to be at least at
100 or greater so that the medium
family
can afford the median priced home
unfortunately it's been below 100 pretty
much the entire post pandemic or the
entire pandemic and post-pandemic era
that we've been in it's now at 80
which is a drop of 2.4% from the
previous year which was 82 however
it's trending in a more affordable
Direction which is interesting given
that mortgage rates are where they are
now mortgage rates have come down a a
little bit the past couple of months
which is a good thing they're they
kind of peaked a few months ago so
that's factoring in and again the medium
priced home being cheaper is factoring
in as well so we'll track that m I
don't know if it'll ever go back up to
100 I think probably that ship has
sailed maybe if we go into a
recession we could see something like
that but for now it's it's sitting
tight in in the 80 range inventory of
homes for and this this one I find to be
very interesting on multiple levels
on the first level we sell a
101% increase year on-year in inventory
it went from December of 2021 we had
1,72 homes for sale at the end of that
month the end of December 2022 we had
3,421 homes for sale that is absolutely
insane it literally doubled 100 1%
increase year on
year however it now has gone down for
the second straight month so October we
saw inventory Peak at
3571 and I said this on my podcast I
don't remember which one it was but I
said I believe that inventory may have
peaked in October and I didn't come up
with that on my own I do a lot of
reading on on the subject experts out
there said we think inventory is going
to Peak in October and sure enough
November it went down slightly and then
December it went down again so we're
seeing some some indicators that
perhaps inventory did peak in October
now what's going to be interesting is
when we go into the the busy season are
we going to see it pick back up cuz
typically we would but everything is
just different now so who knows what
will happen we we'll have to we'll have
to track whether inventory does pick up
month supply of inventory this one
actually surprised me a little bit of
course the the month supply is the
inventory of homes for sale at the end
of a given month divided by the average
monthly pending sales from the last 12
months remember the pending sales is the
one that is kind of a bugaboo in these
stats so we can't really look at
December's
numbers but November only went up to
2.7 months of inventory I would have
expected that to go a little bit higher
than it was but again new listings
are really cooling right now people
have really responded to to the
shifting Market with much much fewer
listings than what we typically see and
so this is causing the inventory to like
I said to Peak and then the month supply
of inventory to be at 2.7 in November
that's still very very low pre-
pandemic you know we saw inventory
levels they would be in the in the three
to four range typically typically
closer to four it just kind of It kind
of depended on the month but for us
to still be at 2.7 I I'm honestly a
bit surprised by that I would expect
inventory to climb above three months of
inventory but at
2.7 that is still on paper a sell's
market now again what's strange is how
much of the inventory is new
construction which is kind of mudding
the waters when it comes to all of this
We've we've never seen so much new
construction inventory at least
not since post Great Recession we
just have a lot of new construction
inventory that's just sitting there that
like I said it's it's mudding the waters
so we're at 2.7 months of inventory
we typically consider anything less
than
really 5 a halfish months six months if
if you want at least by these stats
anything less than that is considered a
sellers Market anything more than that
is considered more than six months is
considered a buyer Market I think the
way things are right now just the the
way things are trending I honestly I
think it it would feel a lot like a
buyer Market if we hit 4 and a half
to 5 months of inventory just because of
how people are reacting to things right
I think that that we have to kind of
rethink some of these numbers like what
how we've traditionally interpreted them
I think we might just have to interpret
them differently going forward because
2.7 months of inventory I mean by all
metrics is squarely a sellers Market
but this feels like a pretty
it it it's definitely a sellers
Market but it feels like a much more
flat Market than 2.7 months of inventory
would indicate and I don't anticipate
that number you know going up by a whole
lot just based on I mean we we need to
look at hold on let me look at the at
the pending sales again
here
so pending sales yeah it pending sales
are are
still probably going to stay quite low
inventory is still probably going to
going to kind of Flatline where it is
it would not surprise me if we continue
to see sub three months supply of
inventory but it doesn't feel like
the insane sellers Market that you would
expect it to feel like in typical sub
three months inventory type of
environment so
at some point I I'm not ready to do this
yet we have to kind of see how the year
plays out but at some point I think we
need to start kind of
reassessing these numbers and what
they actually mean not historically but
now moving forward the his the
historicals of all of this May
honestly no longer matter to a certain
extent so that is that's pretty much
all for the stats for today
I'm very interested to see how this year
plays out as I've said before I'm very
excited I think it's going to be a great
year from a a real estate standpoint
but for those who don't adjust their
expectations it's it could be a really
really rough year so I'm trying to
stay on the crest of the wave I'm trying
to help you guys ride the crest of the
wave as well with regard to at least
some of this data and and my
interpretation of it so I hope that's
helpful for you if you have any
questions let me know my contact
information is in the show notes please
leave a festar rating a short little
review and I hope you guys stay safe
we'll talk again next time
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