Analyst predicts revival of housing market next year
It's not likely that the local market for new houses has hit bottom, but the long-term outlook is good, according to an analyst who monitors the regional construction industry.
"You're going to have to burn through this inventory," analyst Bill Lattimore said Tuesday at a meeting at the Charleston Metro Chamber of Commerce. "The empirical evidence shows that we have not yet reached bottom."
The Post and Courier
Construction crew works near the corner of Larissa Drive and Weeping Willow Way in Grand Oaks subdivision in West Ashley on Tuesday.
Lattimore, a former banker and developer who lives in Savannah, works for developers and lenders, trying to help them assess whether it's time to hold back or to build.
Enough new houses are on the market in the tri-county area or are under construction to last local buyers at least six months, he said. That includes the heavy spring selling season. The ideal inventory, which was the case before the market cooled off about two years ago, is a two-month supply, he said.
The housing supply should start shrinking now that building has slowed. If that's the case, the number of new houses should start picking up again next year, he said.
Lattimore is president of The Lattimore Co. in Savannah and works with Coastal MarketGraphics, which monitors the local real estate market. He spoke to about 150 members of the chamber's developers council.
Nobody expects building to return to where it was in 2005, when builders applied for 9,309 permits for new homes, according to Lattimore's count. But a lot more new houses will be built because Charleston remains a destination for Baby Boomers and retirees from the North, he said. More than 108,500 lots have been approved for future houses.
"We need a balanced message," he said. "These cycles will change."
Meanwhile, the challenge of whittling down the inventory is made more difficult by buyers waiting for prices to come down some more, Lattimore acknowledged.
"Maybe they will, and maybe they won't," Lattimore said.
Mary Graham, the chamber's senior vice president for public policy, also repeated her prediction of a rebound in the new home market by early next year. She said last month, and repeated again Tuesday, that she thought existing homes sales will start to turn around by the end of this year.
Charleston Trident Home Builders Association Executive Vice President Phillip Ford said the local building industry already has rebounded, according to what builders are telling him. More builders have started cashing in permits they already have in hand and have resumed building in the last couple of months, Ford said. Those houses don't show up as new permits.
"I think we've already hit bottom," Ford said. "We've been going on about two years in this slump. I think we're over it. I've heard more positive news from custom builders and volume builders since January than I heard all last year."
Reach Dave Munday at dmunday@postandcourier.com or 745-5862.
E-mail this story
Printer-friendly version
Comments
Oceanlover (anonymous) says...
Hmmm, let's see, a bunch of industry lackeys who have a financial interest in saying that housing has hit bottom. No conflict of interest here, move along, move along. Meanwhile those of us with one foot in the real world might be aware that wherever we go, houses are sitting vacant for month after month after month while these idiots continue to flood the market with inventory. You wanna tell me how the average person can afford a 30 year fixed on an $400k vinyl sided tract house with an actual down payment when gas is over $3.25 and a dollar is worth fifty cents? I smell Al Parrish's lavender-scented Purple Jaguar brand cologne - and that don't smell like Teen Spirit.
April 16, 2008 at 5:20 a.m. ( permalink | suggest removal )
Native_Ink (anonymous) says...
I agree with Oceanlover. The last housing bubble blower we had around here is loving his new house. The view isn't so great, but the construction is solid and those bars on the window are real iron. Plus, you pay the mortgage with time, not money, which probably seems like a good deal to people who believed charlatans like him.
April 16, 2008 at 6:57 a.m. ( permalink | suggest removal )
JohnS (anonymous) says...
Pipe dream. They don't want to believe it's over for a long time. You can look at building material orders in Charleston and see that things are no longer breathing.
April 16, 2008 at 7:27 a.m. ( permalink | suggest removal )
justafan (anonymous) says...
Lets see rates are low and people are desperate to sell...sounds like a good time to buy to me.
Keep sitting around and b&@ching and the good opportunities will pass you by.
April 16, 2008 at 7:34 a.m. ( permalink | suggest removal )
crankyyankee (anonymous) says...
Since it was the Chamber that gave us the watered down immigration legistalation I would encourage everyone to boycott all Chamber activities. Of coarse those that got fat on the backs of illegals are an arrogant bunch and will support each other and lobby the Legislators.
April 16, 2008 at 7:36 a.m. ( permalink | suggest removal )
moonpie (anonymous) says...
Yeah nice try Mr. Lattimore and Mr Ford. Don't know what (2) builders your talking to? Sorry, You can't will it back! Although I'm greatful as it truely is a buyers market. I do intend to buy....Just a market correction. You build to many and guess what, you will run out of buyers. I ride through two neighborhoods frequently and every house that was for sale last year is still for sale this year. Most have been on the market for at least a year or longer...
April 16, 2008 at 8:10 a.m. ( permalink | suggest removal )
Hutch (anonymous) says...
No need to worry about the housing market or the
wall street correction etc. God has it all under
control according to HIS will, AMEN
April 16, 2008 at 8:28 a.m. ( permalink | suggest removal )
ImplantedYankee (anonymous) says...
I'm glad that building is off. That gives existing home sales a much better chance and our local infrastructure wasn't growing to compensate for the additional homes anyway. Why build new homes when there are so many for sale signs? I don't think it's really as bad as everyone thinks, however. The only things I see not selling are condos. Houses are still selling, and even at decent (and more sane) prices. They are spending longer on the market, however. Before the boom when houses were spending just days on the market, no one would have considered this a bad thing.
April 16, 2008 at 8:37 a.m. ( permalink | suggest removal )
ashleyatwork (anonymous) says...
I haven't noticed building slowing down at all in Summerville. We have the massive Ponds developement on Hwy 17 in the works, 2 new large subdivisions, Drakesbourgh, on 78 and Old Orangeburg, and Victoria Point down past Legend Oaks. Not to mention all the subdivisions started 2 years ago are continuing to thrive. Where is this slow down everyone is talking about?
April 16, 2008 at 8:46 a.m. ( permalink | suggest removal )
flinsc (anonymous) says...
They have to build. The investors have money put in from up to 5 years ago, all the materials and deals were made, and also the permits pulled. Those are the developers that will take the biggest hit, because they have agreed returns to investors. The market here has been going down, but still, homes are way over priced. When a brick ranch home in Mt. Pleasant went for 150K back in '03, and now someone still wants 300K for that home, it is way over priced. People are holding off because they realize how over priced the market was, and will wait until price are at a reasonable amount that reflects the traditional 5% increase a year from '03 prices.
April 16, 2008 at 9:02 a.m. ( permalink | suggest removal )
willx45x (anonymous) says...
Mr. Ford, we are a long way from hitting bottom. The general level of cluelessness on the part of these builders, developers and Chamber-types is astounding. I suppose they have to put a positive spin on things, but that sure as heck doesn't make it accurate. This thing has 20-30% more downside, easily. It's hard to come to any other conclusion when you look at the credit markets and inventories - I don't see any meaningful reduction in inventories for another 24 months.
April 16, 2008 at 9:18 a.m. ( permalink | suggest removal )
abc123 (anonymous) says...
It seems that every other day a house near me goes up for sale. I can't imagine the market will recover within the next year with the amount of inventory and sky-high prices. It will be a couple years before the prices come back down to earth.
Look at what people are buying...$185-250k houses. Look at what they are building...$300-500k houses.
April 16, 2008 at 9:24 a.m. ( permalink | suggest removal )
ashleyatwork (anonymous) says...
What I don't understand is why people were going crazy buying (in the heyday between '02-'05) something that was completely over priced? If I went to the grocery store and a gallon of milk were $13.00 I would hold off buying it. Instead people flooded the market to buy these over priced homes. If everybody would have stopped buying the prices would have come down.
April 16, 2008 at 9:40 a.m. ( permalink | suggest removal )
SmooveB (anonymous) says...
All Chambers of Commerce are generally full of sunshine pumpers, but this gang seriosuly trends towards Stevie Wonder forecasting.
Every little positive event, no matter how picayune, is trumpeted as a major win.
April 16, 2008 at 9:49 a.m. ( permalink | suggest removal )
sdr35hw (anonymous) says...
New and existing houses still overpriced. Local demand is waiting on price. Those moving here have to wait on sale of old house. Banks want High FICO and 20%+ down. This aint over.
April 16, 2008 at 10:11 a.m. ( permalink | suggest removal )
sdr35hw (anonymous) says...
If you are offered a 5% loan with 10% down please ask to see the fees associated with the loan.
April 16, 2008 at 10:44 a.m. ( permalink | suggest removal )
KidYendor (anonymous) says...
I can't see the justification in going into another plot of woodlands chopping them down to put in another fancy-named subdivision while people have thousands of existing homes already for sale. If overbuilding was not going on people could sell and not go into bankruptcy and foreclosure leaving the door open for politicians to act compassionate by using our taxed money to use for bailouts which they have no business doing. Don't we read each day the problems caused by over development and loss of habitat and comfortability in our area?
April 16, 2008 at 10:46 a.m. ( permalink | suggest removal )
cede (anonymous) says...
I have always wondered what the "average" person thought about what is happening to our country. Why just last week the word "recession" was just used outloud on TV -- what did they think it was before that??? We have had it all glorified that this "bad spell" is coming to an end but in fact no one really has a clue. I especially enjoyed the comments made by Oceanlover -- right on in my opinion.
I live in Florida and it is somewhat worse here -- there are beautiful homes that people have worked their entire life to obtain and then because a builder came in and built 10 spec homes next to them on the same street -- that now sit vacant, they are being turned into Section 8 housing. Imagine having the home of your dreams next to people that cannot afford food, much less a lawn mower. Very sad situation for all.
Thanks for keeping it real!
April 16, 2008 at 10:47 a.m. ( permalink | suggest removal )
SJ1 (anonymous) says...
You got that one right. The election will send everything down even further. It always does, regardless of who gets elected.
April 16, 2008 at 1:18 p.m. ( permalink | suggest removal )
CountryGirl (anonymous) says...
I agree with Ocean and Kid. The reality though is that developers, construction companys, and all the different types of companies who depend on them to "do their thing" would not be in business if "progress" is halted. The only way to get this under control is for the Government to say "enough is enough", and we know that won't happen because these people lobby every day for what they want. It comes down to politics as usual.
It really is sad that houses are being built with cheap materials, unskilled labor, ridiculous turn-around times, no attention to detail, and only the bottom line to care about.
What's really sad is that we have so many homeless and truly needy people out there with no place to live and tons of empty houses. I'm not taking about homeless who don't care, I'm talking about families who have lost their jobs temporarily, spouses that have died leaving children in cars and on the streets. Battered and abused runaways with no place to go. I know that's another subject though.
It seems like greed is going to ruin our Country.
April 16, 2008 at 1:29 p.m. ( permalink | suggest removal )
SJ1 (anonymous) says...
I've said this on similar posts. If you want to stop development then stop buying the homes. Here's how it works. A developer will buy the land, pay an engineer to secure all of his permits then develops the property (that means they build the infrastructure; i.e., roads, sewer, water, etc.) and then sells the lots to a builder (Centex, Ryland, mom-n-pop,...whoever). After that, the developers are no longer part of the equation, in most cases. So that means the builder is sitting on dirt and waiting for people to show up at their little sales trailers to pick out a lot and a house. They aren't building houses just because they think its fun. They're building them because people keep buying them. It's a supply and demand thing. Stop the demand and the building will cease. If you really want to blame someone how about looking towards all the implanted yankees moving down here to retire.
April 16, 2008 at 1:30 p.m. ( permalink | suggest removal )
whome (anonymous) says...
Vicious circle. Rising housing was created wealth, so the homeowner bought cars, boats, plasmas, etc. The persons that sold those things now had money, to buy houses, which made the previous owners wealth, with which to buy cars, boats, plasmas, etc. Now the system is unwinding, and we're feeling it everywhere. From the closing of prisons, to the inability to purchase the new buses that were promised, to the non-raises to state employees.
Unfortunately, the shock we're experiencing that is more than just a correction in housing prices. Nope, this correction is about how US consumption managed to increase over the last 30 years even though real middle class wages did not increase: debt. The thing that's mind-numbing is the aspersions that's thrown by ideologues. Yes, the subprime borrowers should not have qualified for the loans that they got. But at the same time, these borrowers were the ones that propped up housing prices for other homeowners, allowing them to tap "equity" to buy discretionary items. So while we can blame them, the failure of regulators, where is GWB and the Congress in this debacle? How bad would our economy have really been without the trillions in "wealth" that was "created" during the housing bubble?
April 16, 2008 at 2:09 p.m. ( permalink | suggest removal )
flinsc (anonymous) says...
I am not expecting them to go back to 150 K, but from 300K back down to a respectable 200K range based on what they should have increased. I know I will not be buying until I can get a reasonable price, but it is the people that listen to so called experts saying "great time to buy, interest rates are all time low, hurry up before prices go back up." Anyone buying now should offer 20-25% less than the price. If people want to move that bad, they will sell.
April 16, 2008 at 2:14 p.m. ( permalink | suggest removal )
ImplantedYankee (anonymous) says...
Actually I've just been too busy working. What timing. Someone has to keep paying taxes so that welfare recipients can keep buying drugs and big screen TVs. TP, you got destroyed in that bout, and I'm not sure if you are just clueless or are back to using playground insults, but I'm not a "she".
Do any of you happen to have any numbers on how many of these houses have been bought by "Implanted Yankees?" I'll go ahead and answer for you. You do not. A lot of these houses were snatched up by people from not too far away, and when I bought, I purchased an existing home. Before you blame an implanted yankee, look in a mirror first. How many people do you know who had a house from years ago, realized they could make a fortune selling it, and traded up to a brand new one? I can think of many. What's more, you can thank these implanted yankess and others who have moved here from places other than the northeast, for keeping the market here from crashing like it has in the rest of the nation. Despite the bad news on TV, this area is faring much better than most. BTW -- I didn't come here to retire. I came here to take a great job that no one local seemed to be able to do. Maybe I will retire here one day, but it will be after I've worked and paid taxes here for decades. I still don't understand the mentality of those who think they are somehow special and more entitled to live in a place for no other reason than that they were born in the state that's last in SATs and first in STDs. That's really something to be proud of.
Hopefully there will be a silver lining in the whole housing bubble. After repo-buyers get some of these houses turned back around and occupied, there will be room in the market for building on a more limited and sane scale. Ideally our elected officials will remember this lesson in the future rather than just seeing dollar signs when a developer tries to entice them with increased tax revenues. Time will tell.
April 16, 2008 at 2:15 p.m. ( permalink | suggest removal )
ImplantedYankee (anonymous) says...
Early, I tip my hat to you for your part in the housing recovery. People need to stop maligning those that are bringing these homes back to market.
I may be a little bitter. It didn't take me too long to realize that southern hospitality is a joke, and not a funny one. As I said before, I came down here full of hope and excitement about living in and being part of a better community than the one I left. My values are rather out of place in the northeast, and I thought this would be some sort of mecca for those that valued faith, individualism, freedom, lower taxes, smaller (and more local) government, state's rights, etc. What I found, however, was a lot of narrow-minded fools with unwarranted and misplaced pride in the location of their birth, who treated me with suspicion, and often enough, outright hostility, for no apparent reason other than the fact that I was born north of the Mason Dixon. It almost makes me wish I had spent less time growing up arguing with my northern grade-school history teachers about why they were wrong in the drivel they presented as the causes of the Civil War, and more time sewing a bigger carpet bag.
April 16, 2008 at 2:49 p.m. ( permalink | suggest removal )
Victor (anonymous) says...
Prices have been going down and there is another good 20% to 30% drop. Builders and Sellers are srating to realize that "Specualtion" is gone and the inventory of homes is high. Supply and Demand drive prices.
April 16, 2008 at 3:17 p.m. ( permalink | suggest removal )
ImplantedYankee (anonymous) says...
TP - There were quite a few stories here where posters called repo-buyers "bottom feeders" and the like. It's an emotional thing when someone loses their house, and there's no denying that. Even for those whom have not experienced it, it's easy to emphasize with the plight of others, resulting in an emotional response. It's sad when hard time fall on someone. It would be even more tragic, however, if those houses went vacant.
As for the hostility towards northerners, I was seeing it right here on this website long before I joined. That's a big part of WHY I joined and the whole reason behind my username. I have yet to encounter that in any of the other places I have lived. As someone known here as a troll, it would seem that your "painful truth" is more a personal issue with you than it is with myself or anyone else.
April 16, 2008 at 3:35 p.m. ( permalink | suggest removal )
notafan (anonymous) says...
I love Phillip Fords comment about being out of a recession. If he ever leaves the Homebuilders Assoc he could have a great career as a used car salesman. He can't actually believe all of this nonsense he spews.
April 16, 2008 at 3:49 p.m. ( permalink | suggest removal )
magoo (anonymous) says...
Early try 740 plus you need for your fico score and 20 o/o miniumum now as we speak to get a loan, not many people have a fico of 740 nor 20 0/0 to put down.
April 16, 2008 at 4:26 p.m. ( permalink | suggest removal )
househunter (anonymous) says...
The notion that we are going to be "saved" in Charleston from a severe correction in the housing market because we have nice weather is just wrong. You need to have a base local economy to support the lower income people. Being in HR and looking at the cost of living and salaries in area, it is just unfeasable to sustain these kind of housing prices with out mature job growth which we are lacking. One talks about the northeast and westcoast and marvels at the cost of living. That cost of living is driven by recession proof economies with long standing value companies of which we have very few in Charleston.
April 16, 2008 at 4:38 p.m. ( permalink | suggest removal )
Landbuyer (anonymous) says...
IT's always good to hear the negative side of things
April 16, 2008 at 4:55 p.m. ( permalink | suggest removal )
SJ1 (anonymous) says...
implant- please move back home away from this terrible place and tell your northern friends how rude we are down here. thanks.
okay, one down...a lot more to go...
April 16, 2008 at 5:11 p.m. ( permalink | suggest removal )
buff_o_rilla (anonymous) says...
The dominoes have only begun to fall, and they are falling faster and faster every month, Housing bubble, Credit crunch, Stagflation economy, Unemployment. Its only a correction like the one we had in 1929. Houses should only be viewed as a place to live, The only time they are a real investment that can be counted on is if you plan on renting them out or upgrading them to turn a modest profit. People should have learned their lesson from the tech bubble of the lat 90's, Values can appreciate only so much over a certain period of time. Eventually in the end something is only worth what another is willing to pay for it. ImplantedYankee, you should actually change your id to TransplantedYankee, To be implanted means you had no other choice in the matter, I am former yankee too, The day you stop looking down your nose at those in the south and stop thinking and acting like a yankee that your better than they are the sooner you will realise there is nothing better than living in the south. I wouldnt move back north for twice what i make now. As far as that job you got that no locals was able to fill, You better look around and realise that you can lose that job just as fast and easy as the locals that work here!!!
April 16, 2008 at 8:39 p.m. ( permalink | suggest removal )
SJ1 (anonymous) says...
for the record, i love my northern friends that moved here for the same reasons why i won't move away. but i hate people that move to this area and begin to tell me how terrible it is, how stupid we are and how things "where you used to live" were so much better. more often than not they are from another state. btw, a northerner by south carolina standards is anyone from another state. :)
the stupid, std infested southerners who've lived in our beautiful state all our lives are the reasons why it has always been so beautiful and voted year after year for being the friendliest state. if it seems like things are changing then ask 20 random people in the mt. pleasant/charleston/iop area where they're from and you'll find the reason why.
April 16, 2008 at 9:28 p.m. ( permalink | suggest removal )
bhahnIII (anonymous) says...
This is the same guy that said this in April 2007 at the top of the housing market.....why do they listen to these people ?
"The level of activity we've seen in Savannah will continue over the next five years, but the incremental growth in the other counties, like Bryan, Camden, Liberty, Effingham, Glynn and McIntosh is really going to accelerate," says Bill Lattimore, whose Savannah-based Lattimore Company tracks residential growth along the coast.
WRONG !!!
April 16, 2008 at 11:58 p.m. ( permalink | suggest removal )
bhahnIII (anonymous) says...
These are comments from this "expert" in April 2007 ..... no kidding
Lattimore's current research shows a drop in housing starts in 2006 but forecasts dramatic, potentially overwhelming increases in coming years, especially in McIntosh, where the number of housing starts is expected to triple by 2012.
April 17, 2008 at 12:01 a.m. ( permalink | suggest removal )
ImplantedYankee (anonymous) says...
TP -- as usual, you lack substance so you settle on personal attacks, which is even more ridiculous because you do not know thing one about me. It's little wonder, however. You're a troll, and that's what trolls do. I'm not surprised.
It's important for me to point out, however, that my comments regarding the attitudes of some I have encountered here, in contrast to those I have met in other places I have lived, were a generalization. I have met some truly wonderful people here, especially those that were so supportive during my college years.
SJ1 -- I'm not going anywhere. Deal with it. Actually, it's really a certain subset of people here -- generally the less educated -- that color my view of the populace. Some of the comments I read here reminded me why I feel that way.
April 17, 2008 at 10:55 p.m. ( permalink | suggest removal )
Postandcourier.com is pleased to offer readers the enhanced ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. Postandcourier.com does not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not postandcourier.com. If you find a comment that is objectionable, please click "report abuse" and we will review it for possible removal. Please be reminded, however, that in accordance with our Terms of Use and federal law, we are under no obligation to remove any third party comments posted on our website.
Users can now build user-to-user connections, follow friends' recent posts, add an avatar that fits their personality, and more. If you have posted here before you'll need to sign up again, or if you've never posted before, start now by signing up!
Full terms and conditions can be read here.