SC housing market has weakest 3rd quarter sales since 2017. Here’s why and where buying is worst

The South Carolina housing market had the fewest home sales in a third quarter since 2017, new data shows.

There were 23,277 homes sold in the state between July and September — the fewest in a third quarter since 22.315 were sold in 2017, according to South Carolina Realtors statistics. South Carolina also had 12% fewer homes sold in the third quarter of 2023 compared to the same quarter a year ago.

Meanwhile, home prices continued to soar in the third quarter as they have the last couple of years.

Homes were sold at a median price of $330,000 in the third quarter of 2023, a 2.5% jump over the previous quarter. The third quarter median sales price was also a whopping 72.1% increase from the $191,696 median price in the third quarter of 2017.

Of all the housing markets in the state, Cherokee County had the biggest drop, with 35% fewer sales in the third quarter of 2023 compared to the same quarter last year.

The Hilton Head area housing market had an increase of 5.5% more home sales in the third quarter, year-over-year. The Beaufort County housing market also had increase of 6.5%, the data shows.

Why SC home sales keep falling

South Carolina’s housing market is still in the midst of a major readjustment after several years of unsustainable high demand in 2020 and 2021, said Joey Von Nessen, research economist at Moore School of Business at the University of South Carolina. After the COVID-19 pandemic began, demand for housing surged as people spent more time at home and wanted to change their living arrangements, Von Nessen said. And with interest rates at historic lows at the time, coupled with multiple federal stimulus checks, homes were relatively more affordable.

In contrast, the drop in home sales activity more recently can be attributed to two factors.

“First, the Federal Reserve began a series of interest rate hikes in 2022 in order to combat rising inflation levels,” Von Nessen said. “This, in turn, has led to a steady increase in mortgage interest rates that has persisted throughout 2023 and significantly raised the cost of housing as a result. Second, the practice of social distancing has significantly decreased, and people are now returning to pre-pandemic spending norms by spending more on in-person services (like restaurants and travel) and less on housing and other goods.”

Nationwide

On the national level, home sales have also continued to drop — 8.7% in September, month-over-month, which is the slowest pace since March, U.S. Census data shows.

“Higher mortgage interest rates are taking their toll on buyer demand, and a number of buyers are choosing to postpone their next home purchase until rates move lower,” a South Carolina Realtors report states.

Third quarter SC housing market sales

Patrick McCreless

The State

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Patrick McCreless is the Southeast service journalism editor for McClatchy, who leads and edits a team of six reporters in South Carolina, Georgia and Mississippi. The team writes about trending news of the day and topics that help readers in their daily lives and better informs them about their communities. He attended Jacksonville State University in Alabama and grew up in Tuscaloosa, AL.