Spooked by the volatile stock market and a fourth interest rate hike for 2018, home sales plunged across the Charleston region in December and ended the year slightly down, though prices kept rising.
Residential transactions plummeted 17 percent last month with 1,287 homes changing hands. The median sales price of $275,000 was up 2.3 percent from a year earlier.
For all of 2018, total sales came in at 18,159, off about 1.4 percent from the all-time high of 18,410 sold the previous year, according to data released Wednesday by the Charleston Trident Association of Realtors.
The median price climbed 6 percent to $266,500 over the 12-month period, or $15,000.
"It wasn't a bad year, considering 2017 was a record," said Wil Riley, CEO of the North Charleston-based trade organization.
The group said in its monthly report that "evidence is mounting that inventory will finally improve in 2019. This may apply some downward pressure on prices for beleaguered home buyers."
Supply has steadily declined since 2010, when nearly 9,100 homes were for sale as the region's real estate market was still recovering from the last recession. For December, that figure fell to about 5,100, or 5 percent fewer compared to the last month of 2017, according to the Charleston Trident Multiple Listing Service.
A more sustainable inventory level to keep prices in check locally is about 6,500, according to housing officials.
Some of the housing industry's main headwinds in 2018 included the rising costs of labor, lumber and credit. Joey Von Nessen, a research economist at the University of South Carolina, sees some relief coming in 2019.
He said lumber costs have fallen. And the Federal Reserve announced Wednesday that it would be "patient" about future interest rate hikes, which could influence the cost of buying a home.
"That's very good news for housing," Von Nessen said.
On the flip side, labor expenses are expected to continue to go up.
"We now have more jobs available than people to fill them," Von Nessen said. "That will put upward pressure on wages."
South Carolina ended the year with a 3.3 percent unemployment rate, better than the nation's 3.9 percent, and Von Nessen believes the state will see that drop to 3.1 percent by the end of 2019.
The Charleston region has led the state in recent years in job growth as the automotive and aerospace industries expanded. Average hourly earnings jumped 3.1 percent last year in Charleston.
More people working and making more money will continue to drive the state's economy.
"This signals positive growth for housing," Von Nessen said.
After reaching a seven-year high last fall, long-term interest rates have been slipping in recent weeks.
The rate on a 30-year mortgage held steady, averaging 4.45 percent in the latest report released last Thursday from financier Freddie Mac. The rate on a 15-year loan stood at an average of 3.88 percent.
"Housing markets remain on solid footing," Von Nessen said.