All Forum Posts by: Troy Gandee

You're probably right @Patrick Roberts. And they've been the problem in the eyes of the REC. The term that was being used frequently was "equity stripping". Enough sellers complained that they were deceived and weren't aware the wholesaler wasn't their ultimate buyer and/or that they didn't approve of the assignment fee. They felt they were taken advantage of. Especially the lower-income folks.

It could be an overreaction now and calibrate later, but we'll see. I've personally not seen much of an effect to the market due to it. The wholesalers have been affected, but I don't think it's been too big of a detriment on flippers.

There are essentially no assignment deals going on in Charleston any longer. At least not with residential properties. You can still assign commercial properties and vacant land, but not with anything residential. The attorneys have essentially been deputized by the REC. Any agent or attorney that assists with a "wholesale" deal could also be liable if they assist with the deal. The bill expressly prohibits agent from acting in or assisting with wholesaling. 

My partner and I just started taking title a few years ago. It's not really been that big of an adjustment. Having to put some skin in the game tends to keep the bad actors out of the process. I'm not upset about the "ban" that we've seen. I just wish the bill was more clear. A lot of people have been trying to find loopholes and some less scrupulous attorneys are still closing these if they're arranged in a certain way.

@Martin Grodzki Łatę to the party, but I would check the major MTR/corporate rental sites like Furnished Finder and just see what other folks are getting for similar properties in your market. There is quite a bit of nuance to it and some tenants may reach out to negotiate based on the length of stay and if they have a per diem limitation, so there's usually some margin with these. You should be able to get a good baseline checking the major sites. Also, I believe you can check Airbnb and VRBO for 30+ day listings only.

@Quentin Butler Stop by one of our REI Central meetups. We have a main meeting the 1st Thursday of each month and then a sub-group meeting the other Thursdays of the month. I'll be hosting our Landlords meeting tonight. We usually have around 100 people in the room at our 1st Thursdays meetings.

@Kerri Forrest Here is SC and other coastal markets, we're getting absolutely battered with insurance issues on condos. Regimes usually do their best to budget for insurance renewals, but insurance has been spiking so much year over year that it's almost a guarantee they're going to have a shortfall on the budget when the policy renews. Then they usually need to charge special assessments to raise the funds for the renewal amount. We're also seeing a lot of regimes suing builders and contractors for construction defects if they discover chronic issues, which can take years to resolve. For some reason, it seems a lot of buildings are under litigation due to significant capital expenditures. Either of those things can make a property "unwarrantable" in some circumstances and many lenders won't touch them. Even a standard special assessment for an insurance gap or run of the mill capital repairs may scare buyers off. 

@Michael Miles Aside from the tax implications like these other fine folks have mentioned, the actual transfer is very easy. You'll generally just have a closing attorney do a quit claim deed. They usually require some consideration, so $5 or $10 is standard as a "sale" amount. Then there will be administrating and recording fees to account for. When I've done quit claim filings, it's usually anywhere from $250-$500 per property.

@Kevin Hintz It's property dependent, obviously, but last year, I sold one a street back from the beach that they're cash flowing. I think they put down around 20%. And I believe they're going to be looking for another one pretty soon. You just have to make it more exciting than the competition. A lot of the beach rentals down there are pretty outdated and don't provide many amenities. The flood insurance has also been extremely unpredictable at any of these beaches, so that's a bit of a curve ball.

@John Kirtley It's definitely gone up a lot in value, but you can compare the values to Folly or Isle of Palms (Sullivans isn't really comparable) to see the future growth. IOP and Folly were both sleepy little boho beach towns just like 20 years ago. Now they're full of 5-10m homes. Edisto is on deck to be next. You can see huge homes being built all over the place there now.

@John Kirtley Most of the Charleston beaches have become too expensive to cash flow. Many of them now have very restrictive permitting requirements.

However, I have a real soft spot to Edisto Beach. A lot of people haven't even heard of it. It's our least developed beach. It's a little ways away from Charleston, which has kept it off the radar, but it's starting to become a more significant beach destination. For my money, I'd look there and let the market bring you up. It's not long till it looks more like Folly or Isle of Palms there. I've sold quite a few in that area. 

I recently sold one I had on Seabrook Island because the club/regime/HOA were frequently changing the rules and making it harder to operate smoothly.

It's definitely gotten more difficult in South Carolina to invest. Prices have surged due to the supply strain. I'm not complaining. It's been great as a Realtor and good as an investor on the sell side. It's just exceedingly difficult to find deals that will cash flow well now. This is more so related to properties in the "cities" and not necessarily tertiary market.

SC is still a very smart market for transplants, though. Home values are still quite reasonable from a national perspective and our economics are very well diversified. Charleston, for example, has been growing in pretty much every sector, especially ports, logistics, manufacturing, tech and professional services.