Homebuyers in the Charleston area in May paid about $61,000 more than one year ago, but escalating prices aren't denting residential sales.
For the third straight month, residential transactions surged past 2,000 amid a scarcity of available properties in the four-county Charleston region.
In May, home sales in the area soared more than 44 percent from a year earlier when the economy was just reopening after the lockdown at the beginning of the COVID-19 pandemic.
Last month, 2,173 homes sold at a median price of $349,000, about 21 percent more than in May 2020 in Charleston, Berkeley, Dorchester and Colleton counties.
During the first five months of the year, 9,642 houses changed hands at a median price of $335,000. Sales volume is up 35 percent while the price is 16 percent higher than the same period in 2020.
Lumber prices, which soared to nearly $1,700 for 1,000 board feet in early May, dropped by June 10 to about $1,100, but the cost of wood, a key home-building ingredient, is still more than three times higher than one year ago, adding thousands of dollars to the price of houses.
The high cost of materials combined with the paucity of houses up for sale continues to plague the market and drive up prices, at the same time that demand remains in overdrive amid rock-bottom borrowing costs.
In May, a scant 1,466 homes were listed as "active" for sale on the CHS Regional MLS. That's down almost 72 percent from a year earlier. Homes are now staying on the market an average of 23 days before being sold. Many are selling the same day they are listed with multiple offers being made above the asking price.
"Sales and pricing continue to increase as we move into the summer buying season, which is generally when we see the highest levels of demand in our region," said Charleston Realtors Association President Rusty Hughes.
"We’re already in a very competitive market, with most listings receiving multiple offers and moving off the market in hours, not days," Hughes said. "Additional demand, competition and the ongoing challenge of limited inventory will create additional competition among buyers."
Home loan financier Freddie Mac reported June 10 the average rate on a 30-year, fixed-rate loan slipped slightly to 2.96 percent, down from 3.21 percent a year ago.
The average rate on a 15-year mortgage dipped to 2.23 percent. A year ago it was 2.62 percent.
"The economy is recovering remarkably fast and as pandemic restrictions continue to lift, economic growth will remain strong over the coming months," said Sam Khater, Freddie Mac’s chief economist.
But, he cautioned, the price of housing isn't going to come down as long as a dearth of stock is available and demand remains elevated.
The local Realtors group adjusted its home sales total slightly higher for April to 2,166 transactions. The median price dipped slightly to $340,628.