The Charleston Real Estate Market Update – Market Conditions

Unprecedented is the term that comes to mind when describing the current Charleston area real estate market.  With the help Byrd Property Group’s Bill Byrd and his thorough analysis and handy charts let’s look at today’s Charleston area real estate market conditions.
 
As Bill dove into the dynamics of both the national and local economy, as well as the real estate statistics, he discovered some interesting facts and unique trends!

Never has any real estate market in recorded history been like what we are experiencing today here in the Charleston area.

Since the market bottom in 2010 the Charleston Real Estate Market has been steadily rising. We have seen increases in the number of sales and listings each year as well as increases in the average price of homes in the area. As of February 2021, the average sales price in the Charleston Real Estate Market has risen to $445,402.
 

The Average Sales Price Growth in Charleston

 

What Impacts the Charleston Real Estate Market Today?

  

Migration

A contributing factor of the Charleston area’s growth has been the migration habits of the U.S. population. South Carolina has been noted as one of the top 5 destinations for relocation for many years.

 

According a recent study by North American Moving Services, (North American Van Lines) the top 3 states people are leaving are: New York, California and Illinois and the top 3 states they are moving to are: Idaho, Arizona, and South Carolina.

 

Unprecedented Activity in Charleston Real Estate Market?

Currently we are seeing record high prices and record low inventories of homes for sale in the Charleston Real Estate Market. As soon as a home goes on the market it sells and sells fast!
 
Which brings us to a common concern most people have. People are often hesitant to put their home on the market because they are afraid it will sell fast. Not typically a problem, however in today’s market, finding the next home is the challenge. When homes are selling fast, it makes the timing of finding and closing on your next home a little more difficult.
 
In addition to population migration another factor helping to fuel this home buying demand driving are the extremely low interest rates.
 
Historically low interest rates are instrumental in keeping housing in one of the more affordable ranges. Surprisingly, households are currently only spending 16% of their disposable income on their housing expenses due to the lower rates.

   

  
 

Looking Inside the Numbers

You can see in the chart below the number of new listings has increased from a low in December 2020 of 1,464 to just under 2,000 in February. However when looking at the year over year number between February 2020 and February 2021, there is only a difference of 174 homes.
 

On top of these factors as seen in the below chart, Charleston area homes are selling well under the median historical days on the market now down to only 8 days!

 

Basically, what is happening, is as soon as a home is listed for sale, due to extreme demand and low inventory, it sells fast. The speed of the sale is what is causing our inventory numbers to be at record lows. It is not uncommon to have multiple offers on a home either.  If you are considering selling your home or rental property it does not get much better than this! 
 
The next chart shows the number of Pending Sales in the Charleston Real Estate Market.  These numbers are growing and are unprecedented.  By late February there were over 4000 home sales pending.

 

The chart below shows as of February 28, 2021 the number of homes listed in the entire Charleston Trident Association of Realtors’ (CTAR) MLS system which geographically encompasses additional areas than the immediate tri-county area was only 1,670.  When we excluded these additional areas (listings in Colleton County or say Manning SC, etc.) the inventory of available homes for sale shrinks to below 900 in just the tri-county area. Again, unprecedented.

 
   


 

Headwinds That Could Impact the Charleston Real Estate Market

As we move forward into 2021 the overall sentiment for our market is that we should have another strong year. However, with that said there are a few indicators that are worth watching. 
 

• Inflation – though inflation is still under 2% as of 2-28-21, there are some indicators that signal more inflationary pressures may be ahead.
• Bond Yields – If the yields go up typically mortgage loan interest rates follow and vice versa.
• Stock Market Reversal – This is one of the longest bull run on record.  The market is cyclical and at some point, the pendulum will swing the opposite direction and head towards a bear market.
• Lumber & consumer good prices – current lumber prices are approximately 300% higher than February 2020.  As the economy begins to reopen due to COVID hopefully lumber prices will stabilize and move back into a more normal range.  Consumer Goods such as windows, doors, cabinets, door hinges & knobs, appliances are among other home building components being affected due to supply chain disturbances causing prices to rise and adding to build times and pricing all putting additional strain on available home inventories.

 

Chart of Lumber Prices

 

The Charleston Real Estate Market Update - Outlook

Could March be a turning point in our market, or will it continue to be business as usual? The Charleston real estate market looks pretty good but who knows what the future may hold.  Who would have thought a year ago practically the entire US would shut down?  The important thing is to pay attention to the market.  Timing is important.  If you need to move and find a house, you like do not wait – if not it may sell from right out from underneath you.  Remember the real estate market is cyclical and at some point, it is going to change, but for now unless things change it looks pretty good!
This helpful and informative post outlining Charleston Real Estate Market Update has been provided to CharlestonNewHomesGuide.com by Bill Byrd of Keller Williams – Byrd Property Group located in Charleston SC. Images and article content have been edited however here is a link to the complete original post on Bryd Property Group’s blog which includes further market conditions and analysis.
 
Bill Byrd has been a licensed Realtor/Broker since 1986. Bill has taught pre-licensing classes at the College of Charleston and the Charleston Trident Association of Realtors. In his career Bill has represented both home builders and consumers in the sale and purchasing of new homes. Bill is currently an active real estate broker with Keller Williams Realty Charleston-Mt Pleasant and runs his real estate team the Byrd Property Group. Bill may be reached by email billbyrd@kw.com or web site: https://byrdpropertygroup.com

 

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Categories: Trends