Market Report Article January 2006

Copyright The Post and Courier Jan 24, 2006

South Carolina's robust housing market last year handily outperformed 2004 activity, with statewide sales volume and home prices turning in double-digit increases.

But a Columbia-based real estate trade group predicted that the pace of buying and selling is likely to slow slightly this year.

"Overall, 2006 will probably come in somewhere between the record sales of 2005 and the very strong sales of 2004," said Jim Peters, chief executive of the Columbia-based South Carolina Association of Realtors, which released its year-end tally Monday.

Looking back, Peters said, activity last year "exceeded everyone's expectations."

Statewide, 72,811 homes changed hands last year, up about 23 percent from 2004, while the median price was $148,000, an increase of 10 percent. The findings were based only on homes placed on local Multiple Listing Service databases.

All of the 15 housing markets that the state association tracks showed higher sales volume last year. The only region to see prices slip was the Pee Dee, where the median figure slipped 3 percent to $108,000.

The area that reported the biggest sales gains on a percentage basis was Aiken, where the number of housing deals increased about 50 percent to 1,667 transactions. The median home price in horse country rose 10 percent to $134,000.

"The strength of Aiken's housing market is principally retirees and families moving from Florida or looking for a quieter community with all the amenities and great quality of life," Peters said.

The Charleston region was the state's biggest market in terms of home sales last year.

The number of transactions totaled 15,663, for a 24 percent jump, while prices were up 6 percent to $191,000.

The real estate business was robust up and down the coast.

Along the Grand Strand, a territory that runs from Georgetown to North Myrtle Beach to Conway, sales volume jumped 35 percent to 13,821 and median prices shot up 25 percent to $172,000, marking what Peter said was the highest appreciation reported statewide in the past 12 years.

"The frenzied and speculative nature of the condo market during the summer months has now cooled down to a steady and sustained period of growth that bodes well for the future," he said.

In the Hilton Head area, which is dominated by vacation homes and investment properties, sales tapered off in late 2005 following a strong summer. Overall, volume was up 44% for the year to 4,189 deals, while the median price increased 10 percent to a state-high $365,000.

"Two major factors that will influence the housing market in 2006 will be our ability to create jobs and provide affordable

housing along the coast, more particularly in the Hilton Head and Myrtle Beach markets, where service personnel face long commutes or busing to work," Peters said.

The state's other major housing markets also fared well last year. For instance, sales in greater Columbia increased about 7 percent to 10,632 deals, while the median price rose 13 percent to $132,000. In the Greenville area, volume was up 16 percent to 8,641 sales, and the median price rose 6 percent to $141,000.

Peter said mortgage interest rates should remain low by historical standards this year, a trend that will help fuel demand for primary residences.

Contact John McDermott at 937-5572 or jmcdermott@postandcourier.com.

BIG S.C. MARKETS

Here's a look at how South Carolina's biggest real estate markets performed last year, based on sales of existing homes listed by Multiple Listing Services:

Credit: The Post and Courier