South Carolina Update: Where Are Home Prices Falling?

We’ve talked about the recent spring 2023 numbers for home prices in South Carolina, and it’s clear that home sales have taken a big hit. Compared to April of last year, home sales have actually dropped by 23.4%. But now, we have some fresh data from South Carolina REALTORS. Are there any new South Carolina housing market developments? Let’s look at the current sales numbers to see where prices are headed.

South Carolina Sales Stay Slow

The latest charts and figures from the South Carolina REALTORS show the state matches current trends nationwide. Fewer homes for sale lead to fewer homes sold–but interest is there as median home sale prices keep rising.

Overall, the number of homes sold in South Carolina decreased by 12.5% from May 2022 to May 2023, falling from 9,847 to 8,614.

However, just because fewer homes are selling doesn’t mean home prices are falling everywhere. In fact, there’s a stark contrast between the slipping home sales data and where the median prices land. The median price for all homes bumped up 1.5%, moving from about $327,000 to $332,500.

An example of what’s happening in South Carolina is exemplified in the Greater Columbia metro, the capital city region. As one of the more populated and economically stable MSAs, we have a large enough sample size to trust the data reflects the real estate market. REALTORS data had 1,170 homes sold in August 2024, down 6.2% from August 2023, when 1,247 homes were sold.

Meanwhile, the local median price of homes inched from $274,900 in 2023 to $279,258 in August 2024, a 1.6% bump. This modest price increase was less than other regions and under the average 2.6% year-over-year median home sales price increases across South Carolina.

What’s Happening in South Carolina

Thus far, the August data follows the nationwide trend of fewer home sales but higher house prices. Many experts blame the lack of supply. Many people need affordable homes, but not many homeowners are willing to sell when their current mortgage rates may be better than what they can get now. This has created what may feel like a stalemate for home buyers. The lower supply of homes keeps markets competitive, even if fewer people are buying.

But it doesn’t mean there are no homes available. The number of active home listings is growing, a positive trend for buyers. And, South Carolina home prices remain under national average house prices, presenting an opportunity for home buyers to find affordable housing options.

South Carolina Home Prices

Of the 16 areas listed at South Carolina REALTORS, all but one reported median home prices increasing for the year-to-date ending August 2024. Appreciation in housing values and prices has happened despite total closed sales being down in seven regional real estate markets. 

Cherokee County MSA reported the only price drop for the year to date. Home prices slipped from $225,245 to $219,900, a 2.4% loss. Less-populated areas often report the biggest price swings because they have fewer listings and closed sales. It makes the math more volatile. Cherokee County had only 149 home sales for the year to date. Central Carolina only saw 220 home sales, while Greenwood reported 633.

Why Are South Carolina Home Prices Growing

The influx of new people is the biggest change in the average house price across South Carolina. In 2023, South Carolina topped the nation for population growth. Even though the state still has under six million residents, it’s becoming more attractive as a place to live because of its affordability of housing. Retirees are finding markets like Florida to be outside their budget, but they still want warm weather and access to recreational activities. Families are looking for more space at a price they can afford. People are finding what they need across South Carolina at a reasonable price.

More people means more demand for real estate. Even with the additional housing supply being built across suburbs and small towns, it’s not enough to create a balanced market between buyers and sellers just yet.

The result is statewide bumps in median housing prices. The good news is even if the housing market is reporting consistent price appreciation, the median sale price growth isn’t double-digits. The Pee Region region reported the most change in its housing price, up 7.3%. But, for the year as of August 2024, that was an affordable $220,000.

Hilton Head Island and the Sumter/Clarendon Region reported the next fastest-growing home prices, at 6.9% and 6.6%, respectively.

The Most Affordable Districts

Even with median home sale prices rising, many housing markets in South Carolina remain well under the national average. The most affordable housing was Central Carolina based on its year-to-date home prices. Homes reported a median of $215,000 for their sale price. Potential prices are low in Cherokee County, with its $219,000 price tag, followed closely by Pee Dee at $220,000.

The only real estate housing markets near or above the national average prices were the Charleston Trident ($420,000), Beaufort ($430,000), and Hilton Head Island ($545,000.) There are opportunities for buyers to find the right home across South Carolina at a price that works with their budget.

Universal increases in days-on-market (DOM)

The one category that has not moved is the days on the list to sell. The average days on the market (DOM) statewide are the same, at 67 for the year-to-date in August 2024.

The days on the market hint at where buyer demand is higher, as these properties move off the market quicker. However, days on the market are typically trending upward nationwide as inflation rates have persisted into 2024, keeping mortgage rates elevated. Fewer people are buying homes right now. Most South Carolina housing markets reported increases in the days on the market.

Greater Columbia had the most change, at a 12.5% increase. Still, at an average of 45 days, most properties are under contract in less than two months. Piedmont Region slowed down by 11.4% and Central Carolina by 9.1%.

However, signs of sales activity are still brisk. The Pee Dee had the sharpest drop in days on the market, from 99 to 60. Greenwood region and Sumter/Clarendon homes spent 7% fewer days on the market.

The Future Home Price Outlook for South Carolina

Though the main price charts may instill South Carolina homeowners with confidence that homes are still selling for high prices and, therefore, maintaining their value, the current housing market is shifting. It’s also incredibly hyper-local, with the median sales prices and days on the market varying based on buyer demand. Some of these are competitive markets, as shown by the days on the market. If the greater economic conditions soften, that may increase demand for residential homes and encourage higher average home prices. And even as prices grow, South Carolina’s low housing costs remain one of its attractors for those looking from out-of-state.

The days-on-market shows how the market is changing, particularly with housing inventory. If interest rates dip, more potential buyers may come to the market. South Carolina will need more homes for sale to balance it out. If the supply of homes for sale remains constrained, then property prices could start seeing more dramatic growth as interest in Palmetto state homes increases.

As of August 2024, the housing supply stood at 3.5 months. A gradual increase since mid-2022 is the response to fewer buyers and longer days on market as current homeowners stay in place.