Hilton Head Real Estate to Sizzle in Summer of 2012

Midway through 2012, snapshots of the U.S. housing market resemble 1970s-style Polaroid photos in development: slightly fuzzy and a little out of focus. Zoom in on Hilton Head Island, however, and the picture becomes as sharp as today’s digital images. Addressing a group of area Realtors, Bill Baldwin, broker-in-charge at Dunes Marketing Group said, “The market is changing and picking up. Recognize this and get excited.”

Backing up his remarks with solid data, Baldwin pointed out that Hilton Head Island was the number-one real estate market in South Carolina for 2011 with a 9.4 percent increase over 2010 and an 11.1 percent increase over the state. “From my experience here for over 30 years, Hilton Head Island is one of the last places to experience a slowdown and one of the first to recover,” he said. “We are clearly on the rebound, and our recovery will continue to outpace the rest of the state and most of the nation.”

Citing recent statistics from the Hilton Head Island Multiple Listing Service (HHIMLS), Baldwin said that closed sales YTD as of March 2012 are up 23.9 percent over the same period last year, with inventory down 15 percent. Listings in 2005, when business was booming, were at 2,348—a 4.8-month supply at that time. In 2007, that number jumped to 6,144 listings or a 24.9-month supply. As of April 2012, listings are hovering at 3,921 or a 9.7-month supply based on sales YTD. According to Baldwin, a 6-month supply is ideal, and we are trending in that direction as sales increase and inventory decreases—a strong motivator for giving up the waiting game if you are in the position to buy.

Perhaps more compelling is the expected decline of the most desirable properties, e.g. best price, best condition, best view, best location. In some neighborhoods on Hilton Head, prices have already bottomed and are now starting to move up, Baldwin said. “Now there is urgency again for the best properties. If it is truly a ‘best buy,’ someone else may purchase the property before the end of the week or maybe even later today.”

With a declining inventory and historically low mortgage rates, now is the time to realize a buying opportunity that may not come along again for a very long time. “Our product today is better and will continue to get better than it was at the top of the market in 2005,” Baldwin said, outlining town improvements such as beach re-nourishment, new bicycle paths, new traffic circles, park upgrades, landscaping, improved signage and more. At the same time, major renovations are taking place for accommodations and retail, and proposed redevelopment plans are on the table to improve the Coligny and Shelter Cove Mall areas.

What does this mean to you? When interest rates start to move upward and alternative financing becomes more available, buyers will start to jump off the fence. Inventory will be further reduced and prices will go up, Baldwin predicts. “We are on the road to recovery, and things are changing fast. I believe there will be a major upswing in sales over the next six months.”