Charleston SC Real Estate: Potential For A Historic Year
Lately I have been sharing the latest stats from the Charleston MLS for different areas of town, so today I am looking at the overall Charleston SC real estate market.
This is the entire MLS area for all parts of the greater Charleston SC area, including some outlying areas.
First up, a look at Closed Sales:
That number is on the increase. In January, there were 897 Closed Sales. In February, that increased to 1053. In March it increased to 1428. Last March there were 1134 Closed Sales.
The peak month for 2014 came in June with 1453 Closed Sales. That was the most since September 2006 which had 1462 Closed Sales.
Here is a look at year-over-year comparison of Closed Sales for the last few years:
March 2013 to March 2014 saw a 21.3% jump in the number of Closed Sales over the previous March to March period.
March 2014 to March 2015 saw a 11.5% increase in Closed Sales.
Despite media reports about the housing market not doing strongly, Charleston SC appears to be doing just fine.
But, there are more numbers we need to look at before declaring everything just peachy.
Here are the latest Pending Sales:
That number is also on the rise. In January, there were 1163 Pending Sales. In February, there were 1413 more, and in March Pending Sales increased to 1883. Last March, there were 1366 Pending Sales.
The peak month in 2014 was April with 1462 Pending Sales. So, already barely into 2015 we have exceeded last year’s peak.
This seems to be a recurring theme throughout Charleston–we are exceeding last year’s peak numbers and in many cases, we have hit high numbers we haven’t seen in years.
The previous high for Pending Sales in Charleston SC before this March was March 2005 with 1855. So, this March was the highest in at least 10 years, and probably all time.
Nationally, February was the highest month for Pending Sales since June 2013.
The numbers for March are due out this week, but if the Charleston area is any indication, we should see March numbers exceed February.
Next up is a look at home values. Here is the Average Price Per Square Foot for Charleston SC real estate:
Although that took a slight dip in February, that number is also on the rise. In January, the Average Price Per Square Foot was $139/sq ft.
In February it dropped to $136/sq ft. In March, it rebounded up to $143/sq ft. Last March the Average Price Per Square Foot was $140/sq ft.
The peak for 2014 was in June at $145/sq ft. So, we almost matched that already in 2015.
The last time the we saw an Average Price Per Square Foot that high was August 2008 which was also at $145/sq ft.
Next is a look at the Average Sales Price for Charleston SC real estate:
It’s not too surprising to see the Average Sales Price follow the same trend as the Average Price Per Square Foot. In January, the Average Sales Price was $301,264. In February it dipped to $287,271. In March, it was on the rise again, to $298,683. Last March the Average Sales Price was $298,638–almost identical.
The peak month in 2014 came in June at $315,050. That was the highest Average Sales Price since August 2007 which had an Average Sales Price of $318,038.
If you listen to the media, then you have probably heard reports about home values being down. But that is not an accurate statement. Across the country home values are continuing to rise, just not at the rate they appreciated in 2013. This is actually good news.
Everyone remembers the housing bubble from a few years back. Home values appreciated at rapid, double digit rates with no stopping.
Well, at some point they had to stop. Rather than slow down into a sustainable rate of growth, the bubble burst and the market crashed.
What is happening now is the market is correcting itself and appreciation is slowing to a historically healthy, sustainable rate of growth.
That has been reflected in the Charleston market as well. This is easier to see in a year-over-year comparison of Charleston SC real estate home values:
6.9% isn’t that extreme, but it is above a “normal” 3%-4% rate of growth. However, in 2013 we saw a lot of double digit rates of appreciation, and as 2014 wore on, we saw the appreciation rates slow down closer to a normal 3%-4%.
You can see that the last 2 March-to-March periods that home values are still increasing–it’s just that the rate at which they are increasing has slowed.
Again, this is a good thing, despite what the media will try to have you believe.
Next, is a look at the Average Days On The Market (DOM) for Charleston SC homes for sale:
That number is on the decline, although it did take a slight upturn in March. In January, homes for sale in Charleston SC averaged 79 DOM.
In February, that dropped to 68 DOM. In March, it was up to 72 DOM. Last March the Average DOM was 86.
The lowest DOM in 2014 came in 71 in December. So, only 2 months into 2015 we topped 2014.
February was the lowest DOM for Charleston SC real estate since September 2006 at 59 DOM.
Finally, a look at the Months Supply Of Inventory:
Like most of the Charleston area, that number is on the decline. In January, there was a 5 Month Supply of Charleston SC homes for sale.
In February, it dropped to a 4.7 Month Supply, and in March we are down to a 4.4 Month Supply. Last March there was a 6 Month Supply.
The lowest month in 2014 was December at 4.9. The highest was April at 6.1 Months. March is the lowest month since February 2006 at 4.2 Months.
Charleston SC dipped below a 6 Month Supply in December 2013, and January and February 2014. It didn’t dip below 6 month again until August, and has been on the decline since then.
Below 6 months indicates a sellers market, and home values increase. Of course, home values have been on the rise for much longer than just over the last year.
Here is a look at home values for the Charleston SC real estate market for the last 10 years:
Things are looking very good in the Charleston SC real estate market. Individual areas are doing better than others, but overall I am seeing the a lot of the same trends throughout Charleston–many that are reflected in these overall numbers.
For many of the stat categories, we are seeing 2014 peak numbers matched or exceeded only 3 months into 2015.
In many cases, the peak numbers we are seeing either in 2014 or 2015 are the best numbers since the real estate boom years.
It is important to also note that we are just getting into Spring in the Charleston SC real estate market.
There already has been a lot of activity, more than is typical in the early months of the year. We still have Spring and Summer to go, and those are when we typically see the most activity.
So, this could be a very big year for Charleston SC real estate–we may see numbers we haven’t seen before. They certainly should come close to, and maybe exceed, numbers we saw during the big real estate build up in the early 2000’s.
Of course, there are still some factors that could slow down housing. Interest rates are expected to increase, but that won’t necessarily slow down the market by itself.
Lack of inventory continues to be a problem as well. Another issue is one of the biggest potential segments of the home buying public, The Millennial Generation, has misconceptions about whether they qualify to buy a home or not.
Nevertheless, there looks to be some great potential for Charleston SC real estate in 2015.
If you are thinking about buying homes for sale in Charleston SC, then bee sure to visit my Pam Marshall Realtor website.
If you are thinking about selling, you need the right agent to get your home not just listed, but sold. Visit my Pam Marshall Realtor sellers page.
And if you want to keep up with the latest MLS stats, then check out my Charleston SC Real Estate stats page.