2009 June

Archive for June 2009

Short Sales vs. Foreclosures in Charleston, SC

Thursday, June 25th, 2009

In this article I will be discussing the differences between short sales and foreclosures. I will also touch briefly on the process for these. Please keep in mind that this is a blog and to go into great detail would take several blogs.

First and foremost a short sale is not a foreclosure! A short sale is a property that is still owned by the person who bought the property. Unfortunately the individual ATTEMPTING (take note) the short sale has usually run into financial hardship. In most cases they have tried to sell the home well before they decided to do a short sale but market conditions do not support the price they owe.

A foreclosure is a property that is owned by the Bank. Another term associated with them is REO (real estate owned). After the foreclosure process is finished they then hire an agent (in most cases) to list and sell the property. As a buyer you have 3 chances to purchase that home. The first is before it’s foreclosed on. You can find which properties are about to be foreclosed on by hiring a thorough agent. You can go to the auction (if auctioned) and attempt to purchase it there. Lastly, you can purchase the property once the bank takes ownership and it has been listed.

Most individuals do not know what a short sale is or that they have that option. In that case an educated agent can honestly be a saving grace. If the individual is behind on their mortgage and the market is not supporting the price they owe, a short sale can be the answer. I found out that most individuals believe there was nothing they could do but let the home go into foreclosure. If they did know about short sales they did not know that a short sale can possibly save that persons credit. In speaking with experts I have come to the conclusion that the day a bank forecloses on an individual their score drops 200-300 points. Since SC is a judicial state the bank can the place a deficiency judgment on that person credit after they sell the property. In most cases the bank takes a large loss compared to what is owed when it sells. That could drop your score another 50-100 points. By doing a short sale your worst case scenario would be a deficiency judgment for the difference between the amount owed and what it sold for. In a lot of cases they don’t even place a judgment on your credit! Reasons to not be approved for a short sale by the bank include but are not limited to: having a large amount of savings or taking a loss well below the market value of the property, which is assessed after the BPO is hired.

Purchasing a short sale can take up to 6 months. You have to make the contract contingent on 3rd party approval. That means you have to get approval from the bank. Once you write a contract on a short sale the seller will put a financial packet together and send that with the contract to the bank. The bank will then assign a negotiator to that file and order a BPO. Once the bank approves or disapproves the price you can then move forward with the purchase of the home. When I take a listing that is going to attempt a short sale I try to keep the price within 25% of the amount owed. That will increase the chances of it being approved. If you are seller it is important to know that you are ATTEMPTING a short sale and in no way, shape or form does it halt the foreclosure process. You can be foreclosed on while attempting the short sale!

Purchasing a foreclosure is a much faster and smoother process. It is pretty much the same as a purchasing an owner occupied home. The main thing to know about is the bank addendums. These are documents that you will have to sign and cannot alter if you want to purchase the home. They are tailored to protect the bank and punish the buyer for any type of breach. Make sure to review these addendums thoroughly before signing them.

Please note that this blog does not guarantee any scores on your credit or promise that a short sale is your best option. Please consider renting, consult with an attorney or your agent before doing anything. This is not a recommendation as each person circumstances may vary. Please understand that the process goes into much greater detail but I tried to keep that as short and sweet as possible while including some of the important information.

THE FRED HOLLAND TEAM

Tags: bank, charleston, foreclosure, owned, reo, sale, short
Posted in Foreclosures | 2 Comments »

New Listings! Charleston, SC Properties For Sale

Wednesday, June 24th, 2009

Each time LaJuan or I get a new listing we will post it in our blog. This week we have two new listings!

1960 Folly Road Charleston, SC 29412

MarshView

PRICE: $2,200,000

4.00 ACRES with Marsh VIEW, PRICELESS LOCATION and ZONED C4! TALK ABOUT EXPOSURE. A recent study indicated that on average 1000 cars per hour arrive on Folly Beach. Another study done by SCDOT indicates that 14K-18K cars would passy by this location. As many locals know, the weekend traffic is at a stand still. This means more potential customers for your business as they wait to get on the beach. There is also a new gas station and Piggly Wiggly directly across the street! Considered a luxury to some, this property has public utilities available and can be accessed from Folly Road or Teal Marsh Road. The property is in the City of Folly Beach and has design board approved plans which have been uploaded. The plans contain mixed use and call for a 42 unit residential community and strip center.

1030 Secessionville Road Charleston, SC 29412

1030Secessionville

Price: $199,000

JAMES ISLAND BELOW 200K! This 3 bedroom 2 BATH (take note) home is located only 10 minutes (that’s with traffic) from downtown, 5 minutes from Folly Beach. Huge fenced in backyard for pets with 7′ X 10.5′ shed. Two bedrooms are carpeted and share a bathroom on the east side of the home. Between those bedrooms and the master bedroom lies Italian ceramic tile in the kitchen and dining area and floating hardwood floors in living room. Living room has 14′ vaulted ceiling, kitchen and dining area have 12′ ceilings. Master bedroom has new brazillian cherry wood floors and 12′ vaulted cathedral ceiling. The heating/AC unit is just a few years old. Two huge live oaks on either side of the two-car driveway.

Please contact the Fred Holland Team with any questions regarding these listings and more… josh@fredhollandrealty.com or 843-343-1307

Tags: beach, charleston, folly, Property, sale, sc
Posted in Homes, Real Estate Listings | 8 Comments »

Mortgage advice from Carson Williams

Tuesday, June 23rd, 2009

carsonwilliams1

These sure have been trying times for homebuyers, real estate brokers and mortgage lenders alike. The most asked question seems to be is this the right time to buy? Most professionals in the real estate business will tell you yes, there is no better time to buy and I am inclined to agree. I do however believe you have to sum up your current situation, such as job stability and do you have enough money for a down payment as well as can you afford to make a mortgage payment each month. Times are very different from a few years ago when a mortgage was not at all very difficult to get. Mortgage rates remain at an all time low and there are still very attractive mortgage programs available for first time homebuyers and repeat buyers as well.

The Federal Housing Administration, generally known as “FHA”, is an excellent first time homebuyer program that requires a minimum down payment and very attractive rates. An FHA insured mortgage has allowed many Americans to buy their first home that have less than perfect credit and might not otherwise be approved for a conventional mortgage.

I recommend that you find professionals that you can trust and you are at ease with, you will be spending a lot of time with these folks and it is important that you can communicate well with them. Next, get pre-approved for a mortgage before you start to look at prospective homes. Be prepared to provide your lender with income documentation and bank statements showing you have the available funds for a down payment. I cannot stress this enough and it is a very simple process that in many cases can be done in a single visit to your mortgage professional. This will ensure you are looking for a home in the price range you can afford and will also let your real estate agent see that you are serious and ready to make a qualified offer. Obtaining a pre-approval letter from you lender and presenting it with your offer to buy might also return a quicker acceptance buy the seller of the home especially if they see you have already started the approval process. Buying a home is one of the most important and rewarding decisions you will make as long as you have the right people working with you.

MORTGAGE BANKER CARSON WILLIAMS: BANK OF SOUTH CAROLINA (843) 958-1046

Tags: charleston, fha, financing, lender, Mortgage, sc
Posted in Mortgage | 3 Comments »

Featured Property

Friday, June 19th, 2009

81-E Ashley Ave. Charleston, SC 29403

81 Ashley Ave. Building

Price: $148,900

Bedrooms: 1 Bath: 1 Sq. Footage: 543 Built: 1850

Description:

SHORT SALE & MAJOR PRICE REDUCTION! PRICED EXTREMELY BELOW VALUE! This condo is located minutes to the marina and connector. You can enjoy jogging around colonial lake or walking to all the wonderful restaurants, night life and Downtown activities. Why pay for a parking spot when your condo offers off-street parking and you can walk or ride your bike to MUSC, VA or C of C. Don’t miss this chance to buy a 1 bedroom Downtown condo in the prestigious Harleston Village. Investors imagine the rental demand to students and medical professionals! Please note home has been vacant for some time and was reduced 60K+. At 218K it was still priced below comps based on price per sq foot! HOA INCLUDES: flood insurance, exterior insurance, pest control, annual termite bond, water and more. This is an attempted short sale so it’s contingent on 3rd party approval.

Contact the Fred Holland Team for more information regarding this listing and more. josh@fredhollandrealty.com or 843-343-1307. Or visit our website at www.fredhollandrealty.com

Tags: charleston, Downtown, foreclosure, Property, sale, short, shortsale
Posted in Homes, MLS Listings | 2 Comments »

Investing in Charleston, SC Real Estate.

Wednesday, June 17th, 2009

batterypanorama1

In this blog I will be discussing the different types of investing in real estate. I have found out that when most people think of investing in real estate the first word that pops in their head is “flip”. That is only one of many ways to invest in real estate. A local lender told me this when his CEO visited them at a retreat. He spoke about the Charleston Market and how he, like the many experts, felt the Charleston Real Estate Market will be one of the best in the nation. With the instability in the bond, mutual fund and stock markets investors are looking for something concrete. (literally) I would like to go into detail about several reasons experts believe our market will be one of the best but I will save that for another blog.

The most common call I receive when it comes to investing in real estate is about foreclosures and short sales. I will eventually post a blog explaining the process of buying a foreclosure or short sale and how they differ. A foreclosure or short sale can be great buys for investments but more importantly first-time home buyers. Foreclosures/Short Sales are priced extremely well to avoid low-ball offers. This means that in most cases they sell extremely fast. Foreclosures/Short Sales allow buyers to buy in communities that they could not normally afford to live in. It also allows them to possibly have some equity and use the home as a stepping stone. In most cases the home will need immediate attention cosmetically. We call this swequity.(sweat+equity)

On the beaches you have vacation rental investing. This by far is the highest dollar amount return you can receive. The actually percentage return is not nearly as good as another type of investing that I will explain below. Foreclosures on the beaches are a little rarer than the surrounding areas. With that said, beaches have depreciated drastically in the last few years and many believe this has created great buying opportunities . That means you have a chance for instant equity or possible appreciation in the future. To obtain the highest ROI (return on investment) then beachfront is the way to go. We have several homes for sale and in the rental program. Examples include a 2.1M dollar property that returned over 100K in rental income during its first year in the program. We have 1.1M dollar listing that returns about 80K a year. Once you move from beachfront your dollar amount return begins to drop. If you are looking for the best returns based on percentage then some examples would be 2nd row listed at 499K and averaging 40K a year in rental income.

Another type of investing is in low-income housing. When it comes to investing in Charleston, this is your lowest risk. With Mutual Funds, Bonds and Stocks not returning what they have historically many people are pulling their money out and looking for other areas to invest in. This has had the highest demand for the past few years. The idea is to buy in areas that are low-income and at a price range of 70K or below. On average a 3 bedroom home rents for $725.00 a month. With the right agent and good negotiating you can also buy with instant equity. That means a 70K home rented at $725.00 a month would return at least 12% in rental income alone! Any appreciation or equity is a bonus! These homes usually require low maintenance and with a good inspection you can know what you are getting into prior to closing.

There is also long term rental investing. This does not return as high a percentage as low-income investing but it can be a good investment. The average 3 bedroom 2 baths home brings about $1200.00 a month in rental income. This does depend on the location and area. The idea is to find something below market value, rent it so it pays for itself and when the market is corrected sell for a profit. You will need a diligent and experienced agent to find the best possible buy at that time.

Lastly, you have flipping. Currently this is the riskiest way to invest in Charleston Real Estate. I prefer people that are planning to flip to purchase the home with cash. This way if it ends up sitting on the market for a while you have very little overhead. The idea is to find an extremely good buy. It can be a total renovation, tear down and/or a home that needs some “TLC”. You would then purchase that home, have your contractors lined up and put the home back up for sale as soon as possible. Having experience in this type of investing I know firsthand what it takes to be successful. Cash is king when it comes to “flipping”.

We are also certified HUD buyer agents. Please contact me for more information.

THE FRED HOLLAND TEAM

Please consult your agent before purchasing a home. Please note that this blog is not a recommendation or advice on where and what to purchase. I cannot predict or guarentee any appreciation, equity or profits. There is always risk when investing.

Tags: charleston, estate, foreclosure, real, sale, short, shortsale
Posted in Property Investment, Real Estate | 3 Comments »

Featured Property in Charleston, South Carolina

Sunday, June 14th, 2009

LaJuan and I have 30+ listings in several counties, price ranges and styles. We will be featuring one of our listings every 3 days. Please check back often to see what the next featured property is!

106-3J W. Arctic Ave. Folly Beach, SC 29439

pavilion3jphoto1

Price: $499,000

Bedrooms: 3 Bath:3 Sq. Footage: 1385 Built: 2004

Description:

BEST PRICED UNIT IN PAVILION WATCH! Beautiful top floor unit with BUILDING 3 UPGRADES and a newly renovated Master Bath. Enjoy the Views of Ocean and Folly Fishing pier. This condo has easy access to the beach. This gated community amenities include two elevators, pool and clay tennis court. This fantastic pricing includes all furnishings including new LCD HDTV’S. 9 foot ceilings and crown molding set off the living area. There is off-street parking and plenty of room to relax on the covered patio overlooking the Atlantic Ocean. Could be an income producing vacation rental.

Contact the Fred Holland Team with questions or to request more information! (843) 343-1307 or josh@fredhollandrealty.com

Tags: beach, charleston, estate, folly, Property, real
Posted in Homes for Sale, Real Estate Listings | 2 Comments »

Charleston, SC Real Estate

Thursday, June 11th, 2009

Charleston Map

What buyer’s want to know about Charleston?

I get a lot of calls from potential out-of-town buyer’s asking about Charleston and what areas should they look to buy in. They always ask the same questions. Could I elaborate on the different locations? How close to the beach are these areas? How close to Downtown? What has the best return on investment? In this article I would like to discuss the Charleston Real Estate Market and location layout. I tell every client the same thing. I can never promise a return on investment but I will try and find them the best deal in that area. I work by a risk/reward system but I look at the risk vs. the reward. That means instead of saying you will make 20% in 4 years. I consider if the market fell by 5% annually for the next 4 years and you are getting this 20% below market value then you have minimal risk.

Charleston is very unique. We have several islands surrounding the Downtown Peninsula. The most demand in past years has been on these islands. I will explain why but first let’s look at Downtown. When people visit Charleston they spend most of their time on the Peninsula. Charleston is rich with entertainment, history and fine dining. The Peninsula is actually very small and most homes are the famous 1800′s built “Charleston Single Style.” The pros to buying Downtown are location and the uniqueness of living there. Most of the homes are extremely old and because homes are right on the street and due to the size of the peninsula, parking is limited and at a huge premium. Due to the age of these homes you will see a lot more issues on inspections than normal. We also have what is known as the “Charleston Lean”. These homes have a lean to them. Some can be very dramatic but in most cases they are structurally sound and widely accepted because they are so common. Downtown can have a hefty price per sq foot. The biggest demand I see is South of Calhoun. I deal with more 2nd homes, investors and/or college kids purchasing on Downtown Charleston than I do locals.

West Ashley is our shopping district. West Ashley does not have a high dollar per sq. ft. as Downtown but is more expensive than the North Area. Due to the size of West Ashley and traffic, the length of time it takes to get Downtown or the beach varies. West Ashley saw good demand in the 2000′s. I have had a lot of first-time home buyer’s purchase in West Ashley.

The North Area which includes, Charleston County, Dorchester County and Berkeley provide the “biggest bang for your buck”. Since 2000 we have had a large amount of national builders build in the North Area. Due to the size of this area I would say it did not have as much demand as the surrounding areas I discussed in this blog. I have sold to a lot of young professionals and military in this location. The biggest complaint that I hear is the distance to Downtown Charleston and the beach. It could be anywhere from 15-45 minutes. In most locations the interstate would be the fastest way to travel. The north area has a lot of shopping malls, entertainment and restaurants. The Dorchester 2 school district is also located in this area.

Mt. Pleasant is just a short drive to downtown and Isle of Palms. They have great restaurants and shopping. This area was in very high demand in the early to mid 2000′s. The average price per sq. ft. is more than the North Area, West Ashley, James Island and Johns Island. I have had all types of clients purchase in Mt. Pleasant. Single Family homes were historically above 225K in this area.

James Island is 8 miles to downtown and 8 miles to the beach. This is a smaller island that I find most buyers looking to buy in. At one time it was very difficult to find a Single Family Detached home under 250K. Now you can find something around 200K. With the right agent and hard work you might find a great deal below 200K. One of the cons with James Island is the lack of diners and shopping. Johns Island is a little further out from Downtown and the beaches than James Island. It also has a lot of undeveloped land. If you are looking for some privacy then this would be an ideal area for you. Johns Island appreciated over 22% in one year.

The beaches were in the highest demand of all through this decade. They provided the biggest return on investment percentage and dollar amount wise. Most beaches are just a short drive to shopping and have some of the best dining around. We have several articles from experts projecting the Charleston Real Estate Market to be one of the best in the nation in Q3 of 2009. We are seeing subtle signs that things are beginning to improve and honestly hope the experts are correct. If you would like a copy of these articles please email me at josh@fredhollandrealty.com

There are several other areas that we work in but I just wanted to give a very brief explanation of the areas that I received the most questions on. I have uploaded a picture map so you can get an idea of location. Our team is knowledgeable and experienced in every area from Charleston to Edisto and West Ashley to St. George. We honestly believe that Charleston is one the best places to live. Please come and see for yourself why year after year we are voted the friendliest city in America!

THE FRED HOLLAND TEAM

Tags: beach, charleston, estate, folly, market, real
Posted in Housing Market, Real Estate Market | 3 Comments »

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Archive for June 2009

Short Sales vs. Foreclosures in Charleston, SC