A wave of new homebuyers from the northeast and other parts of the country flooded the Hilton Head, S.C., real estate market over the past few weeks, motivated by low interest rates and high coronavirus caseloads in densely populated cities and suburbs, real estate agents say.
The result: a banner month in May for pending home sales around the area.
Despite requirements that prospective buyers wear PPE or their requests to take virtual tours via Zoom, pending home sales increased 11.3% in May year-over-year, with 629 pending sales in total, according to Hilton Head Island MLS data. Those sales fell 42.6% in April and 14.2% in March, year-over-year.
"We live in a want-to-live place, not a need-to-live place," said Christian Sherbert, an agent at Berkshire Hathaway HomeServices Bay Street Realty Group. "People have sat in Tysons Corner or Philadelphia ... and talked about moving for so long, and now the COVID virus hit and they're like, 'I can work from anywhere, I need to get out of here.'"
After the number of pending home sales plummeted in March and April, Beaufort County real estate agents were pleasantly surprised by the sharp uptick in properties going under contract.
Historically low interest rates and a surge of buyers trying to flee regions hard by COVID-19 likely played a role in the turnaround, agents told The Island Packet.
"Either there was a pent-up demand or people wanted to get out of the northeast," said Andy Twisdale, a Realtor at Charter One Realty.
Twisdale shared MLS data with the newspaper showing that, in the Hilton Head area, pending home sales in early April sank to a low seen during the 2008 stock market crash.
Gov. Henry McMaster issued his "work-or-home" order on April 6, limiting travel for residents as COVID-19 cases mounted in the Palmetto State.
Yet by May, pending home sales shot back up to last year's local levels, 2019 being the best on record for pending sales in 20 years, according to the MLS data.
Sherbert, who is board president of the Beaufort-Jasper County Association of Realtors, said people from the Washington, D.C., suburbs, the Atlanta metro area and parts of Pennsylvania were probably looking to escape heavily populated areas after the coronavirus swept through major cities.
Lea Allen, an associate at RE/MAX Island Realty, received a "big chunk" of leads from New York and New Jersey last month. Heather Baker, president of the Hilton Head Area Association of Realtors, reported an influx of clients from Pennsylvania. But, she added, local residents also took advantage of low interest rates to shop around for new homes in the county.
Both buyers and sellers seemed pleased with the market conditions, Baker said, considering the likelihood of lower monthly mortgage payments and an inventory shortage south of the Broad River.
According to the Hilton Head MLS data, the available inventory of homes for sale tumbled 15.9% in May year-over-year. Realtors, though, said inventory was low before the pandemic, anyway.
"Everybody's happy," Baker said. "But the problem is, if we have a buyer, we have got to work diligently and efficiently to get that house for them because there's probably five or six other people wanting that same house."
Allen said sellers seem to be regaining confidence and she expects a return to the pre-pandemic sellers' market.
"We won't really know for a couple of months how the prices held, but certainly the number of transactions and the activity and the pace has been pretty amazing," she said. "I thought it was a great time to come in and maybe take advantage of some seller nerves."
Some buyers were interested in lower-priced condos under $350,000 on Hilton Head Island, Twisdale said.
Allen said $1 million properties were also popular.
"I think I heard we sold 12 to 15 oceanfront or second-row homes in the last 30 days, and that's our kingpin," Allen said on June 8.
Closed sales dropped 42.9% in May year-over-year around the Hilton Head area, according to the MLS data, but that was to be expected, as those contracts were likely negotiated a few weeks prior.
According to Lowcountry Regional MLS data released by the Beaufort-Jasper County Association of Realtors, pending home sales in that MLS also rose last month. Pending sales increased 16.9% in May year-over-year, while closed sales fell 33.1%.
When showcasing a house these days, Baker brings a lock box full of personal protective equipment for buyers to wear, including masks, gloves and shoe booties.
Sellers have been OK letting strangers into their homes, she said, if they're wearing PPE, at least. And she's been telling buyers to not touch anything inside.
Realtors have been using Zoom or FaceTime to show some properties, though, she said. Her firm, ERA Evergreen Real Estate Company, also offers 3-D Matterport virtual tours for listings.
"Some did buy sight unseen," Allen said.
Twisdale, of Charter One Realty, said his firm asked buyers to get prequalification letters before entering others' homes.
"When someone calls to make an appointment to see a house, we are asking questions," Baker said. "Are you pre-approved? Because there's no need to be coming in these houses if you're not pre-approved. Are you visiting from a place that was a hot spot? Are you healthy, as far as you know?"
