COLUMBIA, SC — The housing market in South Carolina ended 2012 in surefire recovery mode.
Buyers, drawn in by a year of historically low interest rates and an improving economy, snapped up homes in the Columbia area at the fastest pace since 2009, when sales were artificially inflated by an $8,000 federal home buyer’s tax credit.
“Barring any weird stuff coming out of Washington, it looks like we’ve created (a good environment for a real estate recovery),” said Nick Kremydas, executive director of the S.C. Realtors trade group, which released its year-end home sales report Tuesday.
Home sales rose a solid 17.4 percent to 7,587 last year in the Midlands, compared to 2011 – one of the worst years on record for real estate in the region. Statewide, sales rose 12.5 percent to 53,375 for the year.
Prices of homes that sold were fairly steady – down .8 percent to $140,000 in the Midlands and up 1.5 percent to $150,000 statewide.
“Momentum is on our side,” the report said.
With the steady growth in the housing market in 2012, Kremydas upgraded the recovery from “weak” to “fragile.”
Several factors are expected to push the recovery forward, including continued ultra-low mortgage rates, good job recruitment in the state and an abated housing foreclosure market that Kremydas said appears will not have a significant negative impact on normal sales operations.
“The shadow market isn’t going to have the impact we thought,” he said.
Other positive indicators in the market:
• Pending home sales – in which a sales contract has been signed but the sale has not closed – rose 37 percent in Columbia in December to 576, suggesting a hot sales streak in the months ahead. Statewide, pending sales rose 12 percent to 3,416.
As sales rose last year, inventory levels returned to more balanced levels. Columbia had just over a 10-month supply of inventory at the end of the year, while South Carolina had a 9.5-month supply – the lowest levels in at least two years. A healthy, balanced market is around six months, experts say.
• Builders also are beginning to build out neighborhoods left half-finished during the worst recession in a lifetime and start new ones. Columbia-area builders took out 2,833 permits for new homes last year – a 25 percent increase from 2011.
• The strongest market was in the $200,001 to $300,000 price range, the S.C. Realtors report showed. Pending sales spiked 32 percent in Columbia and 22 percent statewide.
“Economic growth is on an upward trend and several prominent housing indices continue to showcase market turnaround,” the Realtors’ report stated.
“Momentum is on our side, though it won’t necessarily be fast, consistent or universal,” the year-end report stated. “But after five or six challenging years, it’s a welcomed change of pace.”