Introduction To Charleston SC Real Estate Market
If you are looking at buying a house in Charleston, SC as a potential investment opportunity, you must read till the end. Charleston is home to over a hundred and thirty thousand people. However, the Charleston housing market is significantly larger than this. Charleston County encompasses the city of Charleston in the southeastern portion of the state, near the Atlantic Ocean. The broader metropolitan area contains over eight hundred thousand people.
The Charleston SC real estate market ranges from a somewhat dense downtown full of apartments to luxury waterfront homes and condos to affordable suburban properties. Charleston real estate market trends suggest a promising future for both investors and home buyers in the year 2022. The Charleston housing market is somewhat competitive and will stay competitive in 2019 as well. Charleston Metro is predicted to see major growth in several industries in the coming years. Is Charleston going to be one of the hottest real estate markets for investors in 2022? Let’s take a look at the latest Charleston housing market trends.
Charleston Housing Market Statistics
| Median Home Value | $451,972 |
| Median Household Income | $62,213 |
| Average Rent Per Month | $2,355 |
| Home Owners | 53.1% |
| Home Renters | 46.9% |
| Single-Family Homes | 49.7% |
| Townhomes | 5.5% |
| Apt. Complexes | 32.2% |
| Last 12-Month Price Growth Rate | 20.67% |
Charleston Housing Market Trends 2022
Data by Redfin shows that the Charleston housing market is not very competitive as only some homes get multiple offers. The average homes sell for about 2% above the list price and go pending in around 38 days whereas hot properties for sale can sell for about 6% above the list price and go pending in around 26 days.
- In May 2022, Charleston home prices were up 16.8% compared to last year, selling for a median price of $516K.
- On average, homes in Charleston sell after 37 days on the market compared to 48 days last year.
- There were 443 homes sold in May this year, down from 496 last year.
- Sale-to-List Price was 102.0%.
- 49.0% of homes sold above the list price.
- 15.6% of homes were sold with price drops.
The number of homes on the market rose slightly but is still down from what a balanced market should offer in the region. Meanwhile, sales are almost exactly where they were last year, suggesting a leveling off, while prices continue to escalate throughout the sought-after Charleston region.
Charleston County is located in the U.S. state of South Carolina along the Atlantic coast. As of the 2020 census, its population was 408,235, making it the third most populous county in South Carolina. Its county seat is Charleston. Let's take a look at the housing market statistics of the larger county area.
On Realtor.com, the median listing home price in Charleston County, SC was $505,000 in April 2022, trending 18.8% year-over-year. The median listing home price per square foot was $291. In a buyer's market, properties sell slowly, and buyers do not have to compete so much with each other to score a property. These market circumstances typically make sellers eager to charge less on a house than they would otherwise.
Therefore, sellers can decrease their asking prices. Based on the last month's data, Charleston County, SC is a buyer's market, which means that the supply of homes is greater than the demand for homes. It had a total sales to total listings ratio below 0.12, which tends to favor buyers. An increase in inventory and lower buying power will result in lower sale prices and signify a buyer’s market. A buyer's market indicates that buyers have greater control over the price point.
There are 24 cities in Charleston County where there were active listings. Sullivan's Island has a median listing home price of $3.1M, making it the most expensive city. North Charleston is the most affordable city, with a median listing home price of $299.9K. Let’s take a look at the latest Charleston housing market forecast for the next twelve months.
Charleston Real Estate Market Forecast 2022-2023
As the interest rates rise, many home buyers and investors have questions regarding the future of the Charleston real estate market. One positive trend that will affect real estate in the Charleston market is continued job growth. This ongoing job growth means that there will be a continued demand for housing. If you are a house buyer or real estate investor, Charleston has been one of the finest long-term real estate investments in the United States over the past decade.
The increase in Charleston home prices is easily explained by the theory of supply & demand. Whenever there is a limited supply of an item that is in high demand, prices increase. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In the Charleston housing market, anything less than 5.5 months will cause home values to appreciate and anything greater than seven months will cause prices to depreciate.
According to statistics compiled by NeighborhoodScout, Charleston has enjoyed some of the strongest property appreciation rates in the nation over the past decade. Over the past ten years, Charleston real estate has risen 101.84 percent, which equates to an average annual home appreciation rate of 7.28 percent, placing Charleston in the top 20 percent of all U.S. cities for real estate appreciation.
Looking at only the most recent twelve months, Charleston's appreciation rates continue to be among the highest in the United States, at 20.67 percent, which is more than 70.61 percent of American cities and towns. In Charleston, short-term real estate investors have enjoyed success during the past twelve months. The most recent quarter's appreciation rate in Charleston was 7.96 percent, which amounts to an annual appreciation rate of 35.84 percent. Let’s take a look at the latest Charleston housing market forecast by Zillow.
Between 2019 to 2020, the Charleston home values went up by 6.4% (ZHVI). Last year has been sizzling hot for sellers as over the past year alone the Charleston home values went up 24% and are expected to continue to rise in 2022. The supply is tight and with all the other factors considered, at this time, it is unlikely that the Charleston housing market will see a price decline in 2022. As of May 2022, the typical home value in Charleston is $510,922, up 31.0% over the past year.
The Charleston metropolitan area is an urban area centered around Charleston, South Carolina. The principal cities include Charleston, North Charleston, and Summerville. The area is commonly referred to as the Tri-County Area or the Lowcountry, though the latter term has historically referred to South Carolina's southern coast in general.
- The Charleston housing market has been on fire in recent years.
- There have been more buyers than sellers, home prices have risen rapidly, and at the moment there isn’t any sign that will change.
- The typical value of homes in Charleston-North Charleston Metro is $409,960, up 28.2% over the past year.
- The Charleston housing market forecast ending with May 2033 is positive.
- Zillow predicts that Charleston-North Charleston Metro home values may grow by 13.1% by May 2023.
- If this forecast is correct, Charleston home prices will be higher in the 3rd Quarter of 2023 than they were in the 3rd Quarter of 2022.
- North Charleston home values have increased 27.7% over the past year ($280,920 – May 2022).
- Summerville home values have increased 26.3% over the past year ($355,603).
10 Highest Appreciating Charleston Neighborhoods Since 2000: By Neigborhoodscout.com
- Daniel Island East
- East Central
- Hampton Park Terrace / Citadel Military College
- Meeting St Manor Cooper River Court / North Eastside
- Daniel Island
- North Central
- Uptown
- Westside
- East Side
- Radcliffeborough
Charleston Real Estate Investment Overview
The Charleston SC real estate market is often overlooked for “hotter” markets like cities in Florida and Texas. Yet there are a number of factors that make the Charleston housing market an excellent place for investors to look at buying properties. If you are a home buyer or real estate investor, Charleston definitely has a track record of being one of the best long-term real estate investments in America over the last ten years.
We’re going to outline factors that matter to real estate investors instead of listing quality of life issues and tourist attractions that draw people to an area. When demand is strong but supply is limited, home values go up. Homes in the Charleston SC real estate market have gone up nearly 30% year over year.
Appreciation over the past 10 years is 101.84%. The annual appreciation forecast based on the latest quarter amounts to 35.84%. Expect appreciation to continue, since the population here is growing at a rate of 1.04% annually and its population has increased by 17.59% since the most recent census, which recorded a population of 120,700 in 2010.
Population & Demographics
The Charleston region’s population is growing 3X faster than the U.S. average, to more than 813,000. A steady stream of well-educated young talent, who come for jobs – or create their own in our business-friendly community – are helping to boost that number.
- Total Households = 299,947
- Median Household Income = $65,894
- Average Household Income = $92,599
The Charleston region’s incorporated cities and towns continue to flourish, creating a larger, more diverse workforce. Get a quick data snapshot of the Charleston region’s three counties, 27 cities, and 3,100 square miles. The Charleston region offers local employers a growing pool of 380,000+ skilled workers. The region’s education and workforce training system continues to build a solid base of technically-skilled workers in engineering, information technology, and more.
CHARLESTON SC MSA COUNTY POPULATION ESTIMATE, 2021 (Source: U.S. Census Bureau, 2022)
- Berkeley County: 236,701
- Charleston County: 413,024
- Dorchester County: 163,327
- Charleston Metro Area: 813,052
Charleston Has a Massive Military & Student Market
Any military base provides a large, mobile population that overwhelmingly rents. Joint Base Charleston combined the Air Force and Naval bases located in Charleston. The joint base is home to a number of military training programs like the nuclear power school and Coast Guard maritime law enforcement academy, as well. There is more than twenty thousand personnel in all, and nearly all of the rent.
Charleston, South Carolina was founded around 1670. The College of Charleston serves around 11,000 students. Charleston Southern University is a private university located in the city. The Medical University of South Carolina is the only medical school in the area, attracting students from across the region.
Trident Technical College is the local community college. On top of that are the military educational programs. This creates a disproportionately large student market for a city this size. Yet the Charleston housing market is better than that of the average college town since the value of rental real estate here isn’t dependent on the appeal of a particular college.
The Tourist Market Is Big in Charleston
Charleston, once best known for its rich history dating back to the mid-seventeenth century, is quickly gaining recognition as a destination resort that caters to discerning travelers. The city sits on the Atlantic coast, the ocean breezes mediating the warm summer climate and keeping winter’s chill at bay. The mild weather and surf help to explain why around eight million visitors a year pass through the city. If you have a condo or beach house, you can rent it out to tourists at a decent rate. Note that Charleston County’s rules on short-term rentals through sites like AirBnB are more relaxed than that of Charleston proper.
The Booming Job Market in Charleston, SC
The Charleston SC real estate market is experiencing a boom because the job market is likewise booming. Bosch and Boeing are hiring in the area. Mercedes Benz and Volvo both opened car manufacturing plants in the area, and that’s aside from the military contractors in the area. This helps explain why the unemployment rate in Charleston is less than 3%, a half point below the state average and nearly a full point below the national average.
As of May 2022, Charleston, Charleston County, SC Unemployment Rate is at 2.60%, compared to 2.10% last month and 3.00% last year. This is lower than the long-term average of 4.97%. The availability of jobs brings many here from across the state. Industry growth shows no signs of slowing down, and property values are expected to continue to rise for the foreseeable future. As workers move into the area, following jobs or looking for career advancement opportunities, local inventory will most likely continue to shrink.
This Is a Low Tax State
If you're buying a home in South Carolina, there's some good news. The Palmetto State has some of the lowest property taxes of any state in the U.S. The average effective property tax rate in South Carolina is just 0.55%, with a median annual property tax payment of $980.
The average effective property tax rate in Charleston County is just 0.47%, one of the lowest rates in the state. However, homebuyers in Charleston County should keep in mind the cost of flood insurance. Even for homes that are not directly on the shore, flood insurance in Charleston County can cost thousands of dollars a year, often more than property taxes.
South Carolina is Landlord Friendly
South Carolina like many Southern states is very landlord friendly. There are no limits on late fees, and there are no state laws on payment grace periods. The state doesn’t require a license to be a landlord, though a license is required to rent a property out short-term via AirBnB. South Carolina makes it rather easy to evict someone for non-payment of rent, committing violent acts, and engaging in illegal activities in the unit.
Rental Rates Are Rising
In 2015, the Charleston housing market hit the top ten list of cities with the fastest growing rental rates. Rent increases hit 16.5% in 2015 as people moved to the area to work for Boeing and Mercedes Benz. While new units are coming onto the market, strong demand is keeping rental rates going up faster than the rate of inflation.
As of July 1, 2022, the average rent for a 1-bedroom apartment in Charleston, SC is currently $1,599. This is an 8% increase compared to the previous year. Over the past month, the average rent for a studio apartment in Charleston decreased by -8% to $1,525. The average rent for a 1-bedroom apartment decreased by -12% to $1,599, and the average rent for a 2-bedroom apartment decreased by -19% to $1,623.
Conclusion
The Charleston housing market is certainly benefiting from a local economy that has gained worldwide attention. The Charleston real estate market contains multiple, sizable renting populations aside from a growing workforce that cannot afford to buy local single-family homes. The strong job market and relatively limited space are driving up rents and home values.
Apart from the Charleston market, you can invest in Raleigh, NC. The Raleigh NC real estate market is landlord friendly, contains several large populations of renters, and has an economic future that ensures long-term growth in housing demand and rents. Owning a piece of Raleigh real estate is a great achievement for many people.
Homeowners in Raleigh continue to see their homes appreciate in value because they are in such high demand. From Millennials moving to the area to retirees living here, Raleigh continues to be a great place for people from all walks of life. Whether you are a Baby Boomer or a Millennial, you will find living in Raleigh is a unique experience. From being a leader in the job market to being a hub for entertainment, it’s pretty clear why many people love to call Raleigh home.
Let us know which real estate markets you consider best for real estate investing! If you need expert investment advice, you can fill up the form given here. One of our investment specialists will get in touch with you. Norada Real Estate Investments helps take the guesswork out of real estate investing. We can help you succeed by minimizing risk and maximizing the profitability of your real estate investments.
*The information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
References
- https://www.zillow.com/Charleston-sc/home-values
- https://www.neighborhoodscout.com/sc/charleston/real-estate
- https://www.redfin.com/city/3478/SC/Charleston/housing-market
- https://www.realtor.com/local/Charleston_SC/housing-market
- https://en.wikipedia.org/wiki/Charleston,_South_Carolina_metropolitan_area
- https://www.deptofnumbers.com/unemployment/south-carolina/charleston/
- https://www.thestate.com/news/politics-government/article101629497.html
- https://www.avail.co/education/laws/south-carolina-landlord-tenant-law
- https://www.bestplaces.net/economy/city/south_carolina/charleston
- http://www.live5news.com/story/31247521/charleston-rental-prices-rise-as-millennials-move-in/
- https://www.accreditedschoolsonline.org/south-carolina/charleston-sc/
