We are pleased to report that our local real estate market experienced another year of measured growth and stability in 2019. Even though the year ran in fits and starts, somehow the Island managed to have the second busiest year in home sales, and the busiest year in villa sales since 2005. The strength of last years sales diminished the Island's inventory to some of the lowest levels in years and this might be the catalyst we need to push market valuations disproportionately higher in 2020.
An example of this dynamic can be seen with home sales in Sea Pines. Over the last five years, pricing activity in this market has been fairly even to minus a point or two when the inventory began the year with more than 140 homes listed for sale. However, in 2017, that year started with just 122 homes listed for sale and ended with a 15.8 percent spike in the median sales price. We begin 2020 with only 129 homes listed for sale and after two years of flat pricing. It will be interesting to see how this year pans out.
Island-wide, home sales in 2019 had a decline of 6.2% from the previous year, but it should be noted that 2018 was the apex year for closed sales going back 2005. The median sales price of a home on Hilton Head Island appreciated 4.7%, year-over-year, to $559,000. This was above the national average of 3.3% as of October, 2019. Looking back over the last 5 years, homes have appreciated 7.0% and in the last 20 years, they've gained 38.0%.
Island-wide, the villa market had a busy year with a 6.8% increase in closed transactions and the median sales priced increased 3.2%, year-over-year, to $250,038. Over the last five years, villas have appreciated 16.7% and over the last 20 years they've gained 56.2%.
Home sales in Sea Pines declined 6.8% last year and the median sales price remained even, year-over-over, at $700,000. Like the rest of the Island, 2018 was the busiest year for closed sales in Sea Pines since 2005. Over the last 5 years, the median sales price in Sea Pines has appreciated 15.7% and 45.8% since 2000.
The villa market in Sea Pines continues to do well. Closed sales edged down 1.4% but the median sales price increased 5.7%, year-over-year, to $417,500. This marks the 5th year in a row of appreciating property values. Over the last five years, the median sales price has appreciated 17.6% and by 36.8% since 2000.
For a comprehensive review of the 2019 Hilton Head MLS sales data for communities both on and off the island, please click on the links below:
The Great Recession and the Hilton Head Island Real Estate Market
From 2004 through 2006, the run up to the Great Recession was spectacularly hectic on the Island as the median sales price ballooned 57.2%, from $470,000 to $739,000. Over the course of the next 6 years, those gains painfully deflated until the market found its bottom in 2012 at $467,500.
For whatever reason, our market has not rebounded like the national average. The US House Price Index % Change indicates home prices are up nationwide by 46.9% since the market bottom in 2012. However, the median sales price for a home on the Island has risen only 19.5% during that same period. Yes, if you're looking for a bargain at the beach, Hilton Head Island is on sale vis-a-vis the rest of the country!
Fitch Ratings Upgrades the Town of Hilton Head Island's Bond Rating from AA to AA+
The Town of Hilton Head Island has been cited by Fitch Ratings for its strong financial practices and budgetary policies including the prudent management of debt and reserve polices, and Management's notable experience and ability to rebound from storms. Moody's and Standard & Poor's were similarly complimentary regarding the Town's financial practices and policies. To read more click here.
The face of real estate on Hilton Head Island has changed over the last 20 years, but one constant has remained the same, our commitment to consistently provide exceptional service and fiduciary care to our clients in a relaxed environment. If you have questions about the value of your property or if you would like to start the process of realizing your dream on Hilton Head Island, please contact us today.
We look forward to being of help!
Thanks and enjoy your winter,
THE LOVE FAMILY