Welcome to the August Folly Beach Living Newsletter!
As another terrific tourist and summer season come to a close, my newsletter found below will compare this July to that of last summer. Also included in the newsletter are real estate statistics, events, and my featured listing. The Loafer is a 2nd row vintage beach cottage that has been lovingly maintained. Plus, it sits directly across from a beach access!
Immediately following are local happenings, articles of interest, and lender tips.
I hope you enjoy!
Rebuilding Folly Park at the west end of Folly
Folly Park managers are proposing to rebuild facilities and perhaps expand them with features such as sunset view entertainment deck for bands, permanent restrooms, and a store which may sell beach equipment, refreshments, and food. Tom O’Rourke, commission director, says funding is in place and improvements will go through planning and public hearings once they are approved by the commission. The park has accrued sand since the building of the Folly Beach park groin and renourishment which followed Hurricane Irene. Although the groin is controversial and the inlet behind Folly in no longer navigable for shrimpers, the groin has been successful in the accrual of sand for Folly’s west end park, Bird Key, and Skimmer Flats. Read more about this in ‘Rebuilding Sought for Folly Park’ HERE
Charleston Harbor Deepening
Many have expressed concern over the $550 million Charleston Harbor deepening project which will leave short the seriously eroding Folly Beach and Morris Island beaches. The pair of 3 mile long rock jetties will extend out of the harbor and will block sand in the near shore currents that would feed those beaches. Estimated losses are 20 ft. of beach per year for Morris Island and will leave the federal government on the hook to periodically renourish Folly. The Folly bill is currently $30 million per renourishment.
The deepening project aims to dig the 45 foot deep shipping channel to 52 feet from State Ports Authority terminals through the harbor to the end of the jetties. It would give SC the deepest port on the East Coast making it capable of handling larger ships. The ports total economic impact on the state is about $53 billion (@ 10% of the gross economic product) and includes more than 187,000 jobs.
Other techniques for bypassing the jetties would have far exceeded the costs of renourishing Folly Beach.
This information was taken from the article ‘No jetty work, sand flow changes with Charleston harbor deepening’. Read more HERE
Saving the Lighthouse Oct. 1st LIGHT UP
On October 1st at 7pm the Morris Island lighthouse will light up in hopes of inspiring donors to support the lighthouse restoration. SCE and G is providing a battery powered light for the occasion. The Morris island Lighthouse has stood for 140 years and has not been lit since 1962. Save the Light must raise $5 Million to restore the interior of the lighthouse to prevent further decay. The lighthouse has been stabilized. Read more about the effort HERE
Lender Advice from Lucey Mortgage
Four Reasons Why Homebuyers Should Consider Seller-Paid Points
"Seller-paid points" are where the seller pays points to reduce the interest rate on your mortgage. Consider a home where the list price is $300,000 and the seller is willing to accept a bottom line of $291,000. If the seller reduces the price by $9,000, you would be able to purchase the home for $291,000. Both you and the seller would be happy.
However, what if you purchase the home for $300,000 and ask the seller to contribute $9,000 toward your closing costs? The seller still walks away with his/her bottom line of $291,000. However, there are four extra benefits to you in this scenario:
#1 - Lower Interest Rate and Lower Monthly Payment
Your mortgage interest rate would likely be 0.5% - 0.75% lower if the seller pays 2 or 3 points on your behalf. This means that your monthly payment will likely be lower as well. This is true even though your mortgage balance would be slightly higher, and based on a $300,000 purchase price vs. $291,000 purchase price.
#2 - Less Interest Cost Over the Life of the Loan
Your total savings over the life of the loan is likely be significantly more with seller-paid points vs. a reduction in purchase price. In our example, if you purchase the home for $291,000, you would save $9,000 vs. the list price. However, if you purchase the home for $300,000, with $9,000 in seller-paid points, your total savings over 30 years would be approx. $27,000. This is three times as much impact for you!
#3 - Easier to Qualify for a Mortgage
Your interest rate, your APR, and your monthly payment would all be lower with seller-paid points vs. a reduction in purchase price. This means that your debt ratio would also be lower and it would likely be easier for you to qualify for financing.
#4 - Free Tax Deduction
If the seller pays points on your behalf, the IRS allows you take that amount as a tax deduction. In our example, if you pay $300,000 for the home with $9,000 in seller-paid points, you would receive a $9,000 tax deduction this year. On the other hand, if you pay $291,000 for the home, you would not receive any tax deduction for that $9,000 reduction in purchase price.
So there you have it! Let me know if you'd like for me to run some numbers and see if seller-paid points might make sense in your situation.
PLEASE NOTE: THIS LETTER AND OVERVIEW IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL, TAX, OR FINANCIAL ADVICE. PLEASE CONSULT WITH A QUALIFIED TAX ADVISOR FOR SPECIFIC ADVICE PERTAINING TO YOUR SITUATION. FOR MORE INFORMATION ON ANY OF THESE ITEMS, PLEASE REFERENCE IRS PUBLICATION 936.
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