While no one has a crystal ball, the current Hilton Head Real Estate Market offers sellers some excellent opportunities this year. There is no reason to kick the ball down the street and wait until next year to sell. In fact, if you are listed for sale and or thinking of selling, you may want to consider these selling reasons in 2012.

10.  Life Events

Nothing can change these reasons to sell including: a change in job, a change in your financial situation, aging, marriage, a new baby, death in the family, mid life crisis, unexpected expenditures, just ready, scaling down, divorce, retirement, etc.

 9.  Shadow Inventory

Sideline Hilton Head sellers are starting to sift back into the real estate market.  We call this “shadow inventory” as sellers that have been waiting and watching finally jump into the Hilton Head market and list their property for sale.  This can have an effect on value and either hold it in place or cause it to drop further if more supply enters than demand.

 8. End of Bush Era Tax

If the Bush Era Tax is not extended, starting next year, the maximum rate on long-term gains is scheduled to increase to 20% (or 18% on gains from assets acquired after Dec. 31, 2000, and held for over five years), and the maximum rate on dividends will skyrocket to a whopping 39.6%.  This could be a 33% tax increase.

7.  Medicaid Tax(Obama Tax)

The Medicare Tax is a 3.8% tax that goes into effect January 1, 2013 and may apply to some Hilton Head owners. “High income” owners with Adjusted Gross Incomes(AGI) of more than $200,000 for individuals or more than $250,000 for married couples will have to deal with this new tax. As well, it does not apply to principle residences under $500,000 held jointly or $250,000 for a single.

 6. Relatively low inventory

In 2008 we had approximately 1,000 homes on the Island for sale, currently we have just about 750.  The time to list a property for sale is when the inventory is low.  The best time to sell is when there are fewer properties to choose from. All bets are off if we see an increase in 2013 with an increase in supply.  A seller can sell for more by adjusting their current value than if they wait til later in a market that is building in inventory.

5.  Short Sales and Judicial Foreclosures

There are 25 homes and 14 villas for sale on Hilton Head Island that are in foreclosure and listed for sale.  Although no one knows for fact, foreclosures take some time getting into the market and we believe this year we will have less than next year.  They take a while to work out.  If you are a seller that is dealing with a Short Sale or possible Foreclosures, be sure you know about The Debt Relief Bill of 2007, it may not be extended in 2013 and could mean tax consequences if you close after 2013.

 4.  More Exposure

There are real selling seasons on Hilton Head Island and therefore a seller is more likely to sell now.  In the winter we have fewer visitors on the Island and it is harder to sell properties even with the Internet.  Fewer sales and lockbox showings occur in the winter on Hilton Head Island.

 3. Predictability

We know which party is in office and what to expect until the end of 2012. We do not know what to expect in 2013.  The Debt Relief Act of 2007, the Medicaid Tax(Obama Tax), Capital Gains Taxes, Interest Rates, and the BIG UNKNOWN are all variables once we are in 2013.

 2. Interest Rates

Interest rates are at historic lows and are excellent.  An improving economy could cause interest rates to rise and fewer buyers will be interested in real estate as rates increase.   Buyers lose about 10% of their buying power for every 1% increase in the interest rate.

 1. More Money

While no one has a crystal ball we are selling properties on Hilton Head now with buyers participating and willing to pay fair market value.  There is no reason to kick the ball down the street until next year with all the unknown variables.  If you would like a fair market assessment of your property, please email me at islandrealtor@hargray.com or call direct 800-932-3652.  Thank You