As the Folly Beach SC real estate market continues to correct itself, like most other communities across the country, the one distinct thing that I continue to notice is the strong number of brand new homes that are currently being built. It is a trend that began shortly after the market hit bottom 2+ years ago and only seems to be picking up more steam month by month. At last count there are about 10 new homes currently under construction and about 5 that have recently wrapped up completion. Furthermore there are 4 lots that are currently being cleared in preparation for new homes.
As property values tanked during the recession, lot values took even a bigger hit. In fact back in 2010 there were only 3 lots to sell for the entire year on Folly Beach. Slowly each year following the end of 2010 those total lot sales have steadily increased to 5 in 2011, 6 in 2012 and then 9 in 2013. That trend has continued through the start of 2014 with 5 lots already selling in just the first quarter of the year.
There are a couple of factors that can be attributed to this trend. First was the aforementioned overall decrease in property values over the past few years. Plain and simple, lots have just become too good of a deal to pass up. Buyers that previously cringed at the thought of building new and all that goes into that process have started to realize that in the long run this option can be most cost effective. The 2nd theory can also be the increased relevance of the cost of flood insurance on the coast. Flood rates are skyrocketing and the future costs are only going to increase over time. Lot buyers have the ability to build their new homes well above the Base Flood Elevation (BFE) which keeps their flood premiums at the absolute lowest possible rates. Furthermore, building above the BFE also provides these property owners with the ability to pass these lower flood rate premiums along to future buyers if and when they ever elect to sell their homes….truly a “win-win” situation for these property owners. As the Biggert-Waters Flood Insurance Reform Act continues to get debated and amended in Congress it is quite apparent that all homes below the BFE will have significant flood rate increases.
The future is bright for Folly Beach and all of their property owners. The beach renourishment project is wrapping up its 2nd month, property values are slowly ticking upward and the warm days of spring and summer are quickly approaching. This boom in new home construction continues to add quality homes to an island community that is flourishing. Inventory numbers are down and overall real estate sales continue to move at a brisk pace. The Edge of America, as Folly Beach is so proudly named, should have another memorable beach season to remember for all of the residents and vacation visitors alike.
If you would like any further information about property values on Folly Beach or any of our other coastal communities please do not hesitate to call or e-mail me anytime. I always appreciate the opportunity to be of assistance. And remember to Relax…..It’s Folly.