Learn more about the housing market in South Carolina

Every state is unique when it comes to the real estate market. That’s why it’s critical to understand the market you live or operate in. Whether you’re renting, buying, or selling, it will impact many aspects of your life.  

South Carolina Housing Market Overview

Nicknamed the Palmetto State, South Carolina is a subtropical state in the southeast known for its Atlantic coastline, beaches, and a number of small islands. With the Blue Ridge mountains stretching into the northwest corner of the state, South Carolina is very geographically diverse. According to data from IBISWorld, Real Estate, Rental and Leasing was one of the most significant contributors to the state’s 2023 GDP, behind only manufacturing. This suggests a notable housing market in the state.

At the beginning of the year, experts predicted that the housing market in South Carolina would continue to see an increase in both housing prices and the number of prospective buyers, though the interest rates across the state would settle. As of April 2024, these predictions all appear to have come true, with certain indicators that these trends will continue.

In fact, historically high interest rates have seen a significant decrease across the country. The national average 30-year fixed mortgage rate in late 2023 approached 8%, but settled in April 2024 to just below 7%. As we will discuss later in this article, a similar trend can be seen in the South Carolina housing market, reflecting easing inflation that is bound to benefit a growing demographic of prospective homeowners across the country.

South Carolina Market Trends

To understand the South Carolina real estate market, it’s important to keep up with trends. Let’s take a look at some key ones in South Carolina:

Note: These statistics are based on Redfin’s monthly housing data from April 2024.

Median Home Price 

The median price of a home in South Carolina as of April 2024 was $388,100 according to Redfin’s monthly housing market data. This is an increase of 5.1% from April 2023, accurately reflecting predictions of continually increasing house prices in the state. In Charleston, the most populous city in the state, the median price is significantly higher at $635,000, itself a 13.2% increase from April 2023. It is important to remember that in any state, especially one as geographically and economically diverse as South Carolina, statewide data is pulling from a plethora of housing markets experiencing a variety of different influences and factors.

Number of Homes Sold in April 2024 

7,042 homes were sold in South Carolina in April 2024, which is a 2.5% decrease from the previous year. This number can be expected to increase in the summer months. It is important to keep in mind that nationally speaking, sales usually peak during the spring and summer months and slow in the winter. In fact, the National Association of Realtors (NAR) predicts that in February and March alone, sales activity increases by as much as 34% and prices by 3%.

Despite this, number of home sales from the previous two years have failed to reach the same peaks that were recorded in the summers of 2020 and 2021.

Median Days on Market 

Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer’s market as sales are slower and sellers have less leverage.

The median DOM in South Carolina in April 2024 was 62 days, which is an increase of six from the previous year. This means that, on average, listings spend around two months on the market before being purchased. An increase from the previous year potentially suggests a market that is increasingly favoring buyers.

New Supply Statistics 

In 2021, there were about 9.76 new residential construction permits per 1,000 people in South Carolina. This statistic, which points to the rate of new housing inventory, is significantly above the national average. Increased housing supply is predicted to ease housing prices and increase affordability in many markets across the U.S. in 2024.

Property Tax Rate 

According to Rocket Mortgage, the average property tax rate in South Carolina is 0.57%. This is one of the lowest average rates in the country, higher than only five other states. The average annual property tax in the state is around $2,175.93. As previously mentioned, it is important to keep in mind that this statistic reflects the average of a lot of data in a populous state with significant geographic and economic diversity. Tax rates are likely to vary depending on the value of a home and its location in the state.  

Foreclosure Rate in Q1 of 2024 

In the first quarter of 2024, 1 in every 929 homes in South Carolina experienced a foreclosure filing, according to recent data from ATTOM. This is one of the highest rates in the country, and it is ranked third for foreclosure rates nationwide.

Hottest Local Markets in South Carolina

1. Charleston

Located in the southeastern edge of the state near the Atlantic coast, Charleston is the most populous city in South Carolina. Its median home price is significantly higher than the statewide median at $635,000 in April 2024, with an appreciation of 13.2%. Its median DOM is also lower than the statewide median at 49, suggesting that the market is comparatively competitive and favors sellers. Some of the most popular neighborhoods in Charleston are Downtown Charleston, Harleston Village, and South of Broad.

2. Columbia

Located near the center of the state, Columbia is the capital city of South Carolina and is the second-most populous behind Charleston. Its median home price in April 2024 was lower than the statewide median at $259,000, but still saw appreciation of 4.6% from the previous year. Its median DOM of 23 indicates that compared to the rest of the state, Columbia’s housing market is very competitive and favors sellers over buyers. Some of the most popular neighborhoods in Columbia are South Kilbourne, Shandon, and Earlewood. 

3. Mount Pleasant

Mount Pleasant is one of the most populous cities in South Carolina and is just northeast of Charleston in the southeast part of the state near the Atlantic coast. Its median housing prices in April 2024 were considerably higher than the statewide median at $910,000, which is a 13.8% increase from the previous year. Its median DOM of 47 suggests a market that is more competitive when compared to the state as a whole. Some of the most popular neighborhoods in Mount Pleasant are Park West, Carolina Park, and Dunes West.

Economic Factors Impact the South Carolina Housing Market

A holistic view of South Carolina’s housing market requires a basic understanding of the main economic drivers affecting the market. Let’s take a look at a few below.

Mortgage Rates 

Mortgage rates are a common cause of concern for would-be homeowners across the U.S. in 2024. As previously mentioned, national averages have dipped from last fall’s record highs, and South Carolina is no different. According to Zillow, South Carolina is currently seeing its 30-year fixed mortgage rates down to an average of 6.52%, down from almost 7.7% in late 2023. This accurately reflects predictions that interest rates in 2024 would settle but stay above an average of 6%.

Inflation and Cost of Living 

Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living for many across the U.S., including in South Carolina. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income.

Population Changes and Demographics 

A changing population ca also have implications for the housing market. According to the U.S. Bureau of Labor Statistics, the unemployment rate in South Carolina is 3.2%. This rate is around the average nationwide, and South Carolina is ranked 22nd for its current rate. This relatively low unemployment rate suggest a healthy and thriving economy that is bound to bring more potential homeowners to the state.

South Carolina Housing Market Predictions 2024 

As previously mentioned, experts considered the appreciating housing market South Carolina faced in 2023 and predicted that prices would continue to rise throughout the year. This has proven true over the course of the year, though steadying interest rates and a hope for increased supply in the housing market signified by an increase in sales may indicate a slowing growth in prices.

Likelihood of South Carolina Housing Market Crash 

Though continually rising housing prices in South Carolina may seem concerning, experts have maintained that a crash is significantly unlikely. There are many reasons for this, including a healthy economy signified by low unemployment rates and the decline and stabilizing of interest rates. The market seems poised to continue appreciating, but it is unlikely to reach any significant or concerning threshold in the near future.

Forecast for the U.S. Housing Market

Now that we’ve looked at South Carolina’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years?  

The United States’ current median existing-home sale price is around $384,500 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 2.9.

We’re currently in a seller’s market with buyers looking at continued rising house prices. The same trend can be seen with renters. Housing continues to appreciate, in general.

Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In five years, however, he predicts a more balanced market, in which neither party has a built-in advantage. Thus, the market will shift to a case-by-case basis to determine what kinds of deals people can get.

Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth.

The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Higher mortgage rates and inflation (affecting price of materials) were the main causes.

Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.

South Carolina Rental Market

The rental and buying market are obviously closely linked. When home prices fall, landlords are more likely to buy properties to rent out. Home prices and rental prices are correlated as well because a hot market means prices rise.

Rents were more unaffordable than ever in 2021 and 2022. In 2022, 22.4 million households paying rent said it was unaffordable, which is the highest that figure has ever been, according to a January report from the Joint Center for Housing Studies at Harvard University. The study found that half of all renters in the United States spent over 30% of their income on rent and utilities.  

The markets cooled in 2023, though, due to new units and decelerating demand. But a serious problem persists: Rent increases are still outpacing income gains.  

Moreover, high interest rates are keeping borrowing and transaction activity down. Over half the banks surveyed by the Federal Reserve reported that demand for multifamily loans decreased year-over-year.

The pandemic caused a housing disparity that isn’t going away anytime soon. Unaffordable housing is a serious issue across America. Whether high rents or low income is the main cause doesn’t change the fact that this problem is widespread. 

This short summary leads directly into South Carolina’s current rental market. Below are just a few of the current trends for South Carolina’s rental market based on data pulled from Zillow:

South Carolina Rental Market Key Trends 

• Median rent: $1,899 

• Month-over-month rent change: +$4 

• Year-over-year rent change: +$45 

• Available rentals: 6,194

Conclusion

South Carolina is a very populous and geographically diverse state that is experiencing many different housing markets. As a whole, 2024 has seen many significant indicators of a stabilizing and healthy housing market that buyers and sellers alike should watch closely. Experts and analysts will continue to monitor this market, as well as nationwide factors like interest rates and new construction.