Hello clients and friends,

Over the last week Dave Samson (CFO within Carolina One) has looked at what is happening with Charleston home sales levels (surprisingly strong relative to our expectations) and what is happening with house inventory (inventory is low and declining as is normal seasonally before it starts to climb some in the spring).

Today I plan to address pricing and the direction that prices are moving.

What is worth knowing in this estimation:

(1) Prices are holding up very well in Charleston.
Median sales prices market wide have held steady inside of a very narrow band since last February (12 months) and appear to be poised to hold this trend.

Charleston home median sales price
(2) The rate of price increase, measured year over year, has slowed dramatically. This simply means that we have moved toward price stabilization. This is consistent with the idea in (1) above where we point out our prices are close to where they were one year ago.
Charleston median sales price change by month
(3)  Mortgage delinquencies remain at an almost all-time low. The grey line at the bottom of the graph is the all-time low for delinquencies. The blue line is the current delinquency rate. This means that there is no wave (or even a ripple) of foreclosures headed our way.
National mortgage delinquency rate
(4) Locally, we have roughly a 2.5 month supply of homes for sale. This is solidly in seller's market territory which should speak to prices holding up as long as these conditions persist.
The takeaway is that a lack of inventory should work in tandem with surprisingly strong sales data to support prices.
(5) The main threat to home values, as we see it today, is affordability...specifically a potential upward spike in interest rates.
There is also the possibility that mortgage rates will go down.
Carolina One's mortgage partner (NewRez, one of the largest lenders and servicers in the country) has much internal speculation that rates will decline by year end which would likely further support current pricing.
We could argue either way (up or down) on the trajectory of mortgage rates over the next year.
We'll see what actually happens.
(6) Price and inventory trends vary by price range.
Generally speaking, the higher the price point, the fewer buyers there are relative to inventory available. We aren't saying that the luxury market is weak...far from it...the luxury market is simply more balanced than the lower 80% of the market.

Hopefully this gives you a good snapshot of the Charleston real estate market, and what we believe we can expect.  I certainly do not have a crystal ball, but just know that Charleston is a special market (highly desirable area) and we typically fair better than the average city because of this.

Please let me know you have questions or if you have anyone that I can help.  I always appreciate your referrals of family and friends!

Mike Ciucci, Realtor

Mike Ciucci specializes in the Charleston SC real estate market.  He has been a Charleston realtor for over 18 years, focusing on quality and attention to detail his clients have come to expect.

Mike Ciucci
Carolina One Real Estate

Phone: 843.608.8378
Email: mike@buyingcharlestonrealestate.com


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