The Charleston real estate market remained strong for 2016 and 2017 should be even stronger with demand outpacing supply in the entire Charleston area.
After several years of housing market improvement, 2016, as predicted, was not a pronounced triumph but more of a measured success. Markets took a steady and mostly profitable walk from month to month. Even as supply was short and shrinking, sales and prices were often increasing.
Interest rates were expected to rise throughout 2016, but they did not. Just as happened in 2015, the Federal Reserve waited until December 2016 to make a short-term rate increase. Incremental rate hikes are again expected in 2017. An economy that shows unemployment at a nine-year low coupled with higher wages inspires confidence.
Mortgage rates are not expected to grow by more than .75 percent throughout 2017, which should keep them below 5.0 percent. If they rise above that mark, we could see rate lock, and that could cause homeowners to stay put at locked-in rates instead of trading up for higher-rate properties. Such a situation would put a damper on an already strained inventory environment.
Sales: Pending sales increased 8.6 percent to 18,095 to close out the year. Meanwhile, closed sales increased 9.3 percent to 17,720 for 2016.
Listings: Inventory was lower in year-over-year comparisons. There were 4,733 active listings at the end of 2016. New listings increased by 4.3 percent to finish the year at 22,949. Low home supply is expected to continue throughout 2017.
Showings: Overall the total number of showings in the market was up 3.1 percent over last year. April had the most growth in the number of showings, signaling buyers are eagerly looking for homes early in the season. Demand remained high throughout the year, as proven by the higher number of showings in the face of limited supply of homes.
New Construction: New homes are being built but at roughly half the rate the nation needs in order to sustain a solid inventory foundation. Another factor is that a lot of new homes are being built as rental units, and expensive ones at that. Locally in 2016, new construction was up 17,249 units compared to 16,314 units in 2015.
Josephine Traina, Broker, Realtor®Licensed in the States of South Carolina, Georgia
843-7093-4023 Call or text