The other day, we had two clients from Florida looking at property on Hilton Head Island.  Both buyers commented that  “we really don’t have a recession on Hilton Head Island”.  The cause and effect of media of course washes across the land and colors all areas the same, so we listed the reasons why Hilton Head’s Recession is not the same.  Hilton Head Island is in for a softer landing because of these reasons.

The Hilton Head Recession is not the same because:

1. A Finite and Limited Commodity ~ Hilton Head Island is an Island and was 97% developed when the real estate boom took place.  Of course, the beauty of our market right now is we have a surplus of inventory on Hilton Head Island, but this will change faster than other areas. Hilton Head did not have much land or huge coastlines to develop.
2. Less flippers, more lifestyle buyers. ~ Most of our sales were based on 80% emotion and 20% logic.  The majority of our buyers purchased property because of the lifestyle offered, not for appreciation.  Therefore we did not have as many distressed properties pop up for sale when the market corrected.
3. Aging Baby Boomers ~ One in four Americans is a baby boomer and with over 23% of our population, these boomers have impact on Hilton Head Island.  In fact, these Boomers are more highly concentrated in New England, the Mid-Atlantic States the upper Great Lake states and the Pacific Northwest which are the feeder states to Hilton Head Island(demographic map below)
4. Historical Appeal ~ Hilton Head has built long term support from generations of vacationers that are now closing in on retirement.  Some of these are the baby’s of the boomers above and will follow their families to the Hilton Head Area, or make the move first and many of their families will follow.
5. Less for Sale ~ Signs are prohibited in the private and gated real estate communities on Hilton Head Island.  However if we were to have signs, you would see that there are only a few homes for sale on any one street or villa community.  We are told that this is very different than other areas of the country.

A Softer Landing on Hilton Head Island

While no one has a crystal ball, Hilton Head Island is in for a softer landing than other areas that have years and years of inventory available and for sale.  I did some market research last week for a client and found that in 2010 we sold 10 oceanfront homes on the Island and in 2011 we have already sold 19 oceanfront homes on Hilton Head.  While we do have a surplus, we call this a buyers market because those that do purchase get a better selection, location and price.  Just like musical chairs, though, when the music stops, there will be some Hilton Head buyers standing.  We will try to save you a seat!