Home sales retreated in March, wiping out gains made the previous month across the Charleston region just as the spring buying season gears up.
Residential real estate transactions plunged 9.1 percent from a year earlier, according to preliminary data Thursday from the Charleston Trident Association of Realtors.
The retrenchment comes after sales rebounded about 10 percent in February following three months of declines.
"Sales volume softened a bit in March, ahead of what is likely to be a busy spring season for the Charleston regional real estate market," said Edward Oswald, president of the North Charleston-based trade group.
Last month, 1,561 homes changed hands throughout the region. The median price rose 6.8 percent, or $17,420, from a year ago to $275,000.
"Inventory is still historically low, and prices continue to climb, which deepens the affordability divide in our region," Oswald said. "While this level of price growth is healthy and sustainable, this market has been on the rise for many years and ongoing price growth does shrink the market for some in terms of what’s attainable."
So far this year, 3,760 homes have sold throughout the region, down 5.3 percent for the first three months of 2019 from the same period last year. The median price so far this year is up 4.2 percent.
The number of residential listings on the market throughout the region dropped to 5,654 as "active" for sale in the Charleston Trident Multiple Listing Service in March. That's down 3.3 percent from a year earlier.
A healthier number of available homes in the region to keep prices in check is about 6,500, the group has previously said.
While the cost to own a home continues to rise, mortgage rates, down from this time last year but up over the past week, remain below last fall's seven-year highs.
Financier Freddie Mac reported Thursday the rate on a 30-year mortgage edged up to an average 4.12 percent, while the rate on a 15-year loan rose slightly to 3.6 percent.
Lower rates than this time last year are good news for house hunters, but the decline in mortgage applications last week after rates ticked up reflects borrowers' sensitivity to changing loan rates, according to Sam Khater, Freddie Mac's chief economist.
“Despite the recent rise, we expect mortgage rates to remain low, ... boosting homebuyer demand in the next few months,” Khater said.
Property information service CoreLogic expects home prices to rise 4.7 percent through February 2020.
“During the first two months of the year, home-price growth continued to decelerate," said CoreLogic chief economist Frank Nothaft. "This is the opposite of what we saw the last two years when price growth accelerated early. With the Federal Reserve’s announcement to keep short-term interest rates where they are for the rest of the year, we expect mortgage rates to remain low and be a boost for the spring buying season.
He cautioned that a strong buying season could lead to a pickup in home-price growth later this year.
With about 40 percent of the top 50 metropolitan areas in the U.S. now categorized as overvalued, the strain on homebuyers will persist, especially for younger home seekers. The Charleston region is among those considered overvalued by CoreLogic.
"Our research tells us that about 74 percent of millennials, the single largest cohort of homebuyers, now report having to cut back on other categories of spending to afford their housing costs," said Frank Martell, CEO of CoreLogic.
Nationally, home prices climbed 4 percent over the past 12 months through February, according to the property information provider.
The Realtors group adjusted February's sales figures slightly higher to show 1,246 homes sold at the slightly higher median price of $266,158.
Editors note: Portions of this article were omitted from Friday's print edition of The Post and Courier. It is being republished in its entirety.