South Carolina Home Prices Recover from Repo Properties
Home prices in South Carolina’s tri-county area of Chester, York and Lancaster increased in April by 7 percent, based on a report released by the Piedmont Regional Association of Realtors. The increase is one positive sign affirming hopes of housing market recovery in the area from the effects of bargain-priced repo properties.
The area’s average home price in April was $175,535, representing increases from the $164,089 average price in March and the $168,689 average price in February. The home price in April however still represents a double-digit decline from the $196,294 average price in April 2008.
Butch Brindel, chief executive of the regional realtor association, said all the April numbers are encouraging, as home prices in the Charlotte area also increased slightly in March.
Based on the S&P/Case-Shiller Home Price Index, Charlotte’s March home price increase was the best month-to-month performance among the 20 urban areas tracked by the index.
However, David Blitzer, head of the S&P/Case-Shiller index committee, warned against too much optimism. He said that Charlotte’s other economic indicators are not encouraging, such as layoffs and pay cuts both in public and private enterprises.
Blitzer also said that the market is still loaded with bargain-priced repo properties and the increase in home prices could have been caused by foreclosure moratoriums or voluntary breaks in foreclosure actions.
Charlotte’s March performance on the S&P index showed that its index declined compared to March 2008. Yearly comparisons are significant because they show trends that are not affected by seasonal factors, such as typically higher home sales during spring selling seasons.
Economist Adam York, who works for Wells Fargo’s economics unit in Charlotte, said that the city’s good March performance shows only one month of performance and not a trend. He reiterated that Charlotte has several economic troubles to resolve.
Analysts said that Charlotte’s home price improvement as shown in the S&P index and in the Multiple Listing Service is likely a result of significant declines in foreclosure actions and number of repo properties from November to February. Foreclosure moratoriums launched by federal agencies, mortgage lenders and the Carolinas temporarily reduced foreclosures and repo properties.
According to the realtor association, the number of houses sold in York, Lancaster and Chester counties has increased month to month since January.
Realtor association CEO Brindel said he expects a rise in foreclosures and number of repo properties across the state after the statewide foreclosure moratorium was recently lifted. But he expects more home buyers to get into the market of repo properties to take advantage of tax credits and attractive prices.
