By Shannon Cavanaugh

When the Adante family was ready to leave the winters of Akron, Ohio, they moved into a Florida beach house. However, they eventually became “fed up with the coastal life, tourist traffic and strip malls.”

So they sold their beach home in Florida and began searching online for the perfect place to retire. In January, they moved into their new home in the 2,000-acre Woodside Plantation in Aiken with its rolling hills, trees and lakes, all a far cry from sand and surf.

“We love it here. It’s horse country and everyone is so friendly,” said Maria Adante. “We wanted a place with a small-town sense of community, a place where our neighbors stayed all year round, not just snow birds like you have on the coast.”

While South Carolina remains an attractive area in terms of real estate, home sales across the state fell 5.37% in 2006, compared to 2005, according to the S.C. Association of Realtors. Market experts blame the decrease in sales along the coast for that drop.

However, the Pee Dee and Aiken areas lead the state in home sales performance. Both reported more than a 12% increase in home sales as places such as Woodside Plantation put out the welcome mat. Woodside typically attracts 50% of its homebuyers from coastal communities in Florida, Charleston and Hilton Head, but last year that number jumped to 60%.
The area reported $50 million in sales, a 20% increase over the previous year.

Woodside owner and developer Rick Steele said he expects another “spectacular” year.

“Aiken’s been discovered now,” he said. “We’ve seen a trend of people wanting to move from resort areas, such as Florida and Hilton Head, because of the tremendous increase in housing and insurance costs.”

Projecting another 20% gain in sales for 2007, Woodside Plantation’s developers have purchased another 1,200 acres, where they plan to develop a community lined with trails and built around a golf course and nature preserve.
SCAR said the cooling off of the state’s coastal markets resulted in the first annual decline in state home sales since 2000.

The real estate association reported that Hilton Head home sales declined 36%, followed by Beaufort, Myrtle Beach and Georgetown, which were off 20%. The Charleston market was down 9%.

“The combination of supply catching up with demand, plus the insurance crisis on the coast drove away buyers,” said Nick Kremydas, SCAR’s chief executive officer.

“We especially saw that in condos, where the supply actually outstripped demand. The market just can’t sustain double-digit growth without taking a deep breath for the next big run and that’s what we’re seeing on the coast.”

That pause leaves the coastal areas, which Kremydas refers to as the “golden egg” of the state’s real estate market, trying to regroup, especially sellers who he says were “a little spoiled with some properties selling in one or two days.

“That’s not a normal real estate market,” he said.

SCAR reported that the median home price is up almost 8% over last year, rising to $160,000. The only decline in home prices was in Hilton Head, where the median price fell 0.5% to $364,000.

“A couple of years ago, we had a great rise in property values. Perhaps prices got a bit over-inflated, too strong for the market,” said Dennis Nelson, a real estate agent who operates Coastal Realty Group and Hilton Head Land Co. “When buyers couldn’t sell their properties in other parts of the country, we had a domino effect. Inventory sky rocketed.”

The market shift forced Nelson’s company to think smarter and work harder to make a dollar, but he added that he’s seeing signs of a rebound as inventories come down and prices drop a bit, he said.

Royce King, president of The Litchfield Co. Real Estate LLC in Pawleys Island, has been in the business for 30 years and said he has seen the highs and lows. His 48 agents sold more than $200 million in homes last year.

“You have to throw out 2005 from a marketing standpoint,” King said. “That’s when the investor market swung bigger because of the slow down in the stock market. A lot of people not in the traditional market got in and heated up the market too much.”

While sales figures reflect the strength or weakness of a market, Kremydas said that other issues are the result of city and county governments trying to stop development.

Folly Beach, just south of Charleston, placed a six-month moratorium on new construction or destruction of homes, until the city could hire an outside firm to review the entire city’s land and zoning ordinances.

Danny Rhodes, an agent with Prudential Carolina Real Estate at Folly Beach, said such moves are costing real estate agents business and homeowners their dreams. Rhodes cited a client from New York who backed out of a $750,000 purchase immediately after learning of the moratorium.

“I have tried to look at the positive side of this moratorium, but I don’t see a positive side,” said Rhodes, who lives on Folly Beach. “They say they want to keep the integrity of Folly Beach, but it seems to me they are trying to limit growth.”