Poll shows voters opposed to Point of Sale tax

Columbia, S.C. – Ohio based company, Fallon Research and Communications, recently surveyed SC registered voters about the Point of Sale tax. The findings concluded that 70% of respondents are opposed to the current law. "The point of sale tax is opposed by an overwhelming majority of voters. There is little doubt about opposition to it,” said Paul Fallon, President of Fallon Research & Communications, an Ohio-based research firm. The survey was released by SC Realtors (SCR) as a part of the statewide STOP THE UNFAIR TAX campaign.

Forty two percent of respondents agree that improving the economy and attracting jobs should be top priority for our state leaders. "Voters see the point of sale tax as a flawed policy for a number of reasons, particularly in the context of a tough economy. Given the current voter emphasis on jobs, and the fact that this policy has hurt the local economy, it not surprising that a majority (53 percent) of respondents think this is convincing enough to eliminate the current point of sale tax,” added Fallon.

"A large majority of South Carolina's voters believe that the point of sale tax is unfair and that it is hurting our economy," said SCR CEO, Nick Kremydas. "Voters get it. They understand that the current point of sale tax is flawed. Because of the unfair point of sale tax, some companies have said they will not relocate or open new businesses in our state. In a tough economy, the last thing we need are taxes that eliminate jobs and prevent new businesses from opening in South Carolina.”

In a separate survey question, 53 percent of respondents believe the point of sale tax is unfair because it results in different tax rates for identical homes in the same neighborhood.

"Some people argue that this tax is needed and that it helps local governments. In fact, the point of sale tax is hurting the real estate market because it allows local governments to dramatically increase property taxes on homes, land and businesses when they are sold," Kremydas stated. “And clearly, a majority of voters are not comfortable with local governments spending funds collected from the tax any way they want.”

"This poll suggests that voters will have little tolerance for taxes and policies that have a direct financial consequence for them," said Paul Fallon. "The results leave no question that voters think the point of sale policy is a flawed one, especially with its potential to hurt the economy."

For a copy of the Fallon key findings memo, and to learn more about the STOP THE UNFAIR TAX campaign, visit http://www.ItsJustNotFair.org


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About South Carolina Realtors

South Carolina Realtors is the premiere source for real estate trends and property information in the Palmetto State. With more than 17,000 members across the state, Realtors are working to improve the quality of life in South Carolina. REALTOR® is a registered trademark that identifies a professional in real estate who subscribes to a strict code of ethics as a member of SCR and the National Association of REALTORS®.

STOP The UNFAIR Tax

Dear South Carolina Voter,

Last week you heard from us about The Stop the Unfair Tax campaign - which aims to educate South Carolina families and businesses about a flawed law called "point of sale." The current law allows local governments the right to charge higher property taxes when businesses are sold, or someone wants to buy a home.

What's worse is some local governments have seen a huge windfall from this tax, and even increased spending at a time when you and I have cut back. That’s not right, it’s not fair, and we must put a stop to this now! City and county government lobbyists are working hard to keep this unfair tax, but we can stop them if we work together.

We have a unique opportunity - THIS WEEK - to help fix this flawed law, and get our economy back on track. Together we can stop this unfair tax. It’s simple: go to http://www.itsjustnotfair.org/and:

1. Click “Take Action” and then the “Contact Your Legislator”;
2. Send an email (it takes less than five minutes) to your state representative and senator; and
3. Forward the message to your friends and family.

Let your voice be heard - use our action center to tell the politicians that it’s time to fix the unfair tax - and stop listening to special interests lobbyists for cities and counties - by supporting a current bill - HB 3272 - that will fix the problem, and help get our state’s economy moving again!

Sincerely,

Stop the Unfair Tax Campaign

PS-Please act today - the window to change this law is closing!

Paid for by the South Carolina REALTORS® Association.

Plotting a comeback

Stability key to local real estate rebound

By Katy Stech
The Post and Courier
Monday, January 25, 2010

By retail standards, you could say Lowcountry homes have been selling off the discount rack.

Home prices across the Charleston region fell last year by 9 percent, the steepest year-over-year drop in recent memory, to a median of $181,286. That's off nearly 14 percent from the region's peak annual price of $209,742 set in 2007.

The drop reflects Charleston's oversupply of homes, a number that now tops 9,000, which has grown as lenders try to unload their foreclosed properties and cash-strapped homeowners face the harsh reality they can't afford the roofs over their heads anymore.

Against that, the tough economy has rendered fewer qualified buyers with enough savings or stable employment. By lowering price, sellers, banks and builders all are trying to hook one of those buyers.


The region's median price is calculated by the Charleston Trident Association of Realtors based on all homes sold during 2009 through the group's Multiple Listing Service. For that reason, the decline could be skewed to reflect the makeup of who's buying homes -- a mix of investors, young professionals and employed Charleston newcomers -- more so than the typical home's value.

But the trend also suggests that many current homeowners, especially those who bought around the peak of the market without a sizeable down payment, have built up little equity and probably owe more than their homes are worth.

The good news, however, is that the overall price decline didn't affect all Charleston neighborhoods evenly. Areas with fewer homes listed for sale, such as northern Mount Pleasant and outer West Ashley, saw their prices stabilize -- a function of "good ole supply and demand," as Goose Creek real estate agent Ralph Wetherell pointed out.

Trends also show that more purchasers -- some of whom could tap a generous $8,000 federal tax credit if they qualified as first-time buyers -- flocked to modestly priced neighborhoods.

"It's simply addressing a real pent-up demand that people have had for a long time for affordable housing," said Karen Abrams, a Keller Williams agent.

And the data shows that some areas that did see major price drops were given a consolation prize: a steady trickle of home sales. Dorchester County, for example, recorded 1,948 residential transactions throughout the year, just one fewer than in 2008.

Seeking stability

The health of the residential real estate business plays an enormous role in any economy, as the industry provides the underpinnings for variety of spin-off services: furniture sales, bank lending and remodeling jobs, to name a few.

Frank Hefner, an economics professor at the College of Charleston, said the recent leveling-off of sales could foreshadow a market recovery.

"And even if prices are down, the fact that sales are improving or stabilizing is what everyone's going to grasp at this as a sign of the bottom," he said.

At the top end of the housing spectrum, the luxury market -- both oceanfront and in downtown Charleston -- faltered last year. Prices fell by tens of thousands of dollars as buyers shied away from purchasing second homes during shaky economic times.

"Their desire to be here hasn't changed," said Charles Sullivan of Carriage Properties, a downtown Charleston real estate firm. "They were just waiting for that period of time they thought was the right time."

He noted that toward the end of 2009, more high-end buyers started to emerge as their stock market and investment portfolios recovered some of their value.

Feeling better

While most experts agree that the Charleston market recovery is beginning to take hold, it lags behind the housing recoveries in other major cities with larger employment bases.

Charlotte, for example, began to see an uptick in housing permits last fall, and other cities such as Denver, Dallas and San Diego are recording home sales prices that are virtually unchanged from a year ago because their values fell so hard early on in the recession, according to the widely watched Case Shiller home price index.

Jeremy Willits, president of the local Realtors association, said as local home prices level out, the recovery should pick up speed because more consumers will become comfortable with buying real estate again.

"Seeing the stable home prices will give people more confidence, and that was something that was really lacking in 2009," Willits said. "Their confidence was so damaged by the financial meltdown" that began to spread in the second half of 2008.

That renewed sense of confidence could attract to the market more middle- to upper-class buyers, who were scarce last year. Hefner warned, though, that those buyers still could hesitate to move into more expensive homes, acting out of caution.

"If you're looking at the new era of frugality, I don't know how long (the price drops) are going to last," Hefner said. "People who went through this major financial downturn -- will this change their pattern? Will this change them permanently?"

Another open question for the industry to ponder goes to the behavior of first-time buyers: Will they still be in the market for homes once the federal government's $8,000 tax credit expires in April?

Around the state

How South Carolina and its four biggest housing markets stacked up:

Region Homes sold Median price*

--Charleston 7,446 (-6.1%) $183,000 (-9.4%)

--Columbia 7,608 (-9.9%) $150,000 (-15.3%)

--Greater Greenville 6,447 (-14.4%) $140,000 (-7.9%)

--Grand Strand 5,919 (+5.4%) $140,000 (-2.4%)

--Statewide 46,290 (-8.5%) $141,000 (-8.4%)

*Rounded to nearest thousandths

Residential Real Estate Sales Increase Again in December

Residential Real Estate Sales Increase Again in December
Median Sale Prices at Annual Peak

CHARLESTON, SC—(January 12, 2010) Rounding out a year of stabilization, 618 residential real estate sales in December shows an increase of 30% when compared to sales one year ago today. The $195,534 median home price reflects the peak of prices in 2009 and a slight 2% increase over December 2008. December 2008 posted 476 total closings, with a median sale price of $191,600.

Several months of strong sales, prices that are growing at a sustainable rate and decreasing inventory are excellent indicators that a Charleston market recovery is underway. “Last December, we were looking at a 33% drop in sales and a 9% decrease in median prices from December 2007. We’re in a much more positive place at the end of 2009, actually seeing market increases. While we don’t anticipate tremendous growth in 2010, we do expect to see continued steady growth over the next year”, said CTAR President, Jeremy Willits.

3-Year Review: December*

Sales + - % Median Sale Price + - %
2009 618 +30% $195,534 +2%
2008 476 -33% $191,600 -9%
2007 713 - $210,000 -

*this data reflects the market activity as of the 10th of January for each year.

At the close of the month, there were 8,940 homes listed for sale with the Charleston Trident Multiple Listing Service.

The 2009 Year in Review market report will be released next Wednesday, January 20.

BERKELEY COUNTY
The Berkeley County market remains stable when compared with December of 2008. Last year, 145 properties were sold at a median price of $173,000. In December 2009, 141 properties changed hands at a median price of $170,112.

CHARLESTON COUNTY
Once again, Charleston County leads the region in sales and price increases. Last December, 239 properties changed hands at a median price of $235,000. This year, 313 properties were sold at a median price of $250,000, equating to a 31% increase in sales and a 6% increase in sale price.

DORCHESTER COUNTY
Dorchester County showed a slight 3% increase in sales over December 2008—142 homes sold in 2008 and 146 sold in December 2009. Prices show a 14% decline from last December’s uncharacteristic peak of $195,808 to a more typical price of $167,830.

# # #

With approximately 4,000 members, CTAR’s mission is to promote the highest standards of professionalism, ethics, education and technology, and to ensure that its members are the primary source for real estate services in the South Carolina Lowcountry. Only those who are members of the Association of REALTORS® and its parent organizations are called REALTORS®. To learn more, visit www.CharlestonRealtors.com

Even as interest rate edge up slightly over the past few weeks, rates are still at an all time low historically.

Graph courtsey of Grey Meyer, Carolina One Mortgage, 843-224-0551

5 Markets Expected to Fare Best in 2010

SmartMoney
Real Estate by Lisa Scherzer

After a dour year where housing prices fell more than 12% nationwide, will 2010 bring sunnier tidings?

The short answer: only a tad in a select few places but overall not really.

Yes, there have been pieces of good news over the past few months that have indicated a quiet, slow bottoming of real estate prices. For instance, sales of existing homes rose 7.4% in November from the previous month, the highest rate since February 2007, according to data from the National Association of Realtors released last week. The tax incentives for home buyers passed earlier this year along with historically low interest rates have no doubt nudged many buyers into the market.

Yet a recovery depends on several factors. At the top of the list is a turnaround in the labor market. More people going back to work will have a beneficial effect on household income and consumer confidence and would stabilize the housing market, says Stuart Gabriel, director of UCLA’s Ziman Center for Real Estate. As of November, one of out every 10 American workers is unemployed, according to the Bureau of Labor Statistics. And while that’s down slightly from October, Moody’s expects the jobless rate to peak in the third quarter next year at 10.6%.

Another factor is the backlog in foreclosures, which are dragging down values and adding to the housing supply. “By all accounts, that backlog is at a historic high,” says Gabriel. “It suggests that many more homes will be sold on a distressed basis either via foreclosure or short sale.”

RealtyTrac, an online marketplace of foreclosure listings, estimates 3.2 million households will have received a foreclosure notice in 2009, up from 2.3 million in 2008. The firm projects that number could approach four million in 2010. “We do think 2010 will probably represent the peak, and in 2011 [foreclosures] will start to go down at least marginally,” says Rick Sharga, senior vice president at RealtyTrac. Why the acceleration next year? First, says Sharga, there have been enormous delays in processing this year. Many homes that would have gone into foreclosure in 2009 won’t actually enter and complete the process until 2010.

Second, a big wave of option adjustable-rate mortgages (ARMs) will reset next year. (These are a somewhat obscure category of ARMs that were popular during the real estate boom, which allowed borrowers to make a range of monthly payments. The options include a partial-interest payment that adds the unpaid interest to the loan's balance. On many of the loans, balances have risen while values of the underlying properties have plummeted.) “The number of loans that will adjust starts to go up significantly in the middle of next year. A lot of those loans are underwater...and owners will be really hard-pressed to avoid going into foreclosure,” Sharga says.

Home prices, of course, are variable and depend on many factors, each of which are difficult to predict. Still, average home prices will drop by 7.9% nationwide in 2010, according to Moody’s Economy.com. In the few areas where there could be positive price growth, the projected increase is modest. “These areas will essentially be flat next year,” says Steve Cochrane, managing director at Moody’s Economy.com.

The five areas that Moody’s foresees home prices performing best in 2010 are: Tacoma, Wash., (an increase of 2.44%); Memphis, Tenn., (up 0.99%); Pittsburgh (up 0.89%); Charleston, S.C. (up 0.18%); and Seattle (decline of 0.50%). (These five markets are culled from data on Moody’s Economy.com and based on the largest 100 metro areas.)

These pockets of the country share a few important characteristics. One is that they are starting with a limited supply of housing stock. Another is that throughout most of the decade, prices basically stayed in synch with household income, says Cochrane.

There are other factors, too. Pittsburgh , for example, along with western Pennsylvania, is late in the traditional business cycle, and “our variations tend to be smaller,” says Robert Strauss, a professor of economics and public policy at Carnegie Mellon University in Pittsburgh. The economy has managed to stay fairly stable mostly because over the past several decades it transformed from a center of manufacturing to one of education and health care with a bit of financial services and technology.

Smaller areas across the Southeast are expected to fare well in 2010 primarily because they fared relatively decently during the housing crisis, says Jeannine Cataldi, a senior economist at IHS Global Insight. “They didn’t have such a big run-up, and they have a diverse economic base that enabled them to stay stable,” she says. Home prices in Charleston didn’t get out of line with household incomes; also, Boeing (BA: 54.96, -0.25, -0.45%) is investing in a fairly large manufacturing plant there, which could create some potential for income and job growth, says Cochrane.

As for Memphis, the city’s largest employer is FedEx (FDX: 85.17, +0.01, +0.01%). Transportation services is one of the early industries to turn around as the economy recovers, says Cochrane, and that should support the area’s housing market.

The economies of Tacoma and Seattle – which are neighboring cities – were “much stronger for much longer than much of the rest of the country,” says Cochrane. Software giant Microsoft (MSFT: 30.96, -0.43, -1.36%), based in Redmond, Wash., a Seattle suburb, was one reason the area remained stable. Another was Boeing, which builds its commercial airplanes in Seattle.

Going forward, Seattle’s position as a key hub of trans-Pacific trade should be a plus for the economy. Orders are increasing for commercial aircraft and it should see some rising demand for tech products, Cochrane says. The outlook for 2010 for the two Washington cities “is for fairly stable, moderate economic growth,” he says.

Charleston Trident Association of Realtors appoints new board for 2010

Charleston Trident Association of Realtors appoints new board for 2010

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