It’s a seller’s market when it comes to housing in Glynn County these days.
Anecdotes from local real estate agents and hard data reviewed by The News show the area’s housing market is recovering from the Great Recession, but it has yet to reach pre-recession peaks.
Home prices in one of Glynn County’s most affluent ZIP codes, St. Simons Island’s 31522, are still about 20 percent below what they were when the market crashed in 2007, according to data from Zillow, a leading online real estate database.
That reflects national trends, though more pronounced here, according to a 2017 study by Harvard University that also used the Zillow dataset. Nationwide, homes in neighborhoods earning more than 120 percent of the statewide average income in 2016 were worth 3.3 percent less than pre-recession values.
When the housing bubble that caused the Great Recession burst in December 2007, the average cost of a home on St. Simons Island was $425,700, according to Zillow Home Value Index data.
By July 2012, the average home price on the island plummeted more than 40 percent to $251,700.
The market is starting to make a turn around. At the end of 2016, the average home price on St. Simons Island — including single-family houses and condos — was just under $340,000.
Home prices in Brunswick’s 31520 ZIP code fared more poorly than their island counterparts. When the Zillow dataset begins in February 2012, the average cost of a home was $82,700. By October 2015, the average dropped to $65,000. Since then, the area’s recovery has not been as strong as for homes on St. Simons Island. By the end of 2016, home prices in the ZIP code averaged a gain of slightly more than $5,000 to $70,100.
Still, Sherrye Gibbs, a qualifying broker with Sea Palms Coastal Realty and the president of the Golden Isles Multiple Listing Service board, said she’s glad to see home prices come back to higher levels.
She is not, however, eager to see the break-neck speed of increases in home prices seen before the recession.
“I don’t feel like prices have increased that much,” Gibbs said. “During the recession, I spent a lot of time looking at prices going up like crazy. We (my colleagues and I) talked about what was going to happen before the bubble burst.”
Before the Great Recession, Gibbs said she and her colleagues referred to the massive gains in home prices as “illusional appreciation.” That is, outsized increases in home costs not supported by actual market forces.
“It made no sense that the prices continued to go up and up,” she said. “Now, what I’d say is prices are stable. I’m not seeing huge price jumps. They have gone up a little, but not jumped back to where they were before the bubble.”
The “sweet spot” for selling a home on St. Simons Island, she said, is between $350,000 and $425,000.
“The main thing is for a house to be well priced and well maintained,” she said. “Those are the two key things. Those are the ones that are going on the market and selling quickly.”
Housing inventory remains relatively low, Gibbs said. That’s partially because new construction continues to lag, and people are staying in their homes longer.
“It used to be, people stayed in their houses about five years,” she said. “But I was just talking to a mortgage lender who told me people are staying in their homes almost 10 years. That’s contributing to low inventory.”
Between 2000 and 2010, home builders added more than 8,000 housing units in Glynn County, according to U.S. Census data. Since 2010, builders have added less than 2,000 units.
“There’s not so much new construction,” Gibbs said. “So there’s not much new stock on the market.”
That is contributing to moderately-priced homes being purchased quickly, and sellers walking away with contracts close to their asking price.
Like with home price increases, Glynn County is following the national trend of new construction, according to the Harvard study.
Although nationwide rates of new construction are in their seventh year of gains, they are still significantly lower than rates seen in the 1980s and 1990s. Steady increases in demands and low rates of new construction have kept markets tight, “leaving gross vacancy at its lowest point since 2000,” the study notes.
Although home prices are not growing at the rate many homeowners might like to see, Roland Daniel, broker and owner of the real estate firm Roland Daniel Properties, is optimistic.
“We are going to continue to grow with people who are seeking Glynn County and St. Simons Island as a target market — where they want to be,” he said. “People are coming here because they want to be here.”
He’s also glad to see home prices increasing at sustainable, modest rates, rather than the frenzied spikes seen before the recession.
“Prices are not quite where they were when we were approaching the bubble,” he said. “It’s going to take some time to get to that level, but this has been a more orderly progression. Most segments are doing fairly well.”