Report finds Charleston area new-home conditions upbeat; U.S. real estate market consensus appears strong

Carolina Park ranks as one of the most active communities in the Charleston area in terms of new-home sales, according to a real estate “snapshot” released in January (Photo by Laura Olsen/Olsen Imagery).

In 2008, the housing industry was in survival mode edging toward a steep decline.

Things had improved enough by 2012 that the market was starting to turn a corner, but forecasters still were looking at a break-even figure at best.

Now with low mortgage rates, a surging financial picture and rising home sales and prices, prognosticators are finally ready to predict a stirring season this year.

“For the first time in over eight years, there are many national real estate forecasts projecting a solid 2015, and I expect it to be even stronger here in our local market,” says Will Jenkinson, broker-in-charge of Carolina One New Homes, a unit of Carolina One Real Estate.

The BIC made his comments as part of the Charleston New Homes Snapshot, a quarterly update on the local economy and the outlook for just-built houses. Jenkinson and Brian J. Foster, sales and research consultant with Real Estate Information Service, prepared the report.

“Even with new home inventories down in 2014, (new houses) made up 23 percent of all the closed homes in the tri-county area,” he says. The total was just more than 3,100 closings.

At the same time, single-family permits rose to more than 4,000 last year. And many big neighborhoods are set to open in Berkeley, Charleston and Dorchester counties including two large master planned communities – Nexton and Summer’s Corner, both by MeadWestvaco – in the first half of 2015.

“With job growth projected to continue to increase and the increase of household formations and baby boomers retiring to our area, I project 2015 to see continued growth in our local new home market,” Jenkinson says.

Examining the housing figures in more detail, Jenkinson and Foster found positive numbers in terms of building permits, sale closings by county and the relationship of home starts and sales.

First off, Real Estate Information Service took a look at permits from fourth quarter 2011 through third quarter 2014.

The researcher discovered that each quarter showed year-over-year improvement in permits issued during the 33-month time frame, Jenkinson says.

“Typically, strong permit activity is a good sign that builder confidence is increasing in the market. This is always a strong indicator of the future,” he says.

Another chart from REIS studied new home closings among the three local counties year-to-date, which in the case of the survey was through the first nine months of 2014.

Charleston County leads the way with 810 closings and 44 percent of all new-home closings for the Charleston Metropolitan Statistical Area, according to the graphic. Jenkinson says the top two Charleston County communities are Carolina Bay west of the Ashley and Carolina Park in Mount Pleasant. Combined, they account for more than 25 percent of the new home closings in the county.

By territory, Berkeley County ranked second at 677 closings and 36 percent of the total tri-county count. Dorchester County trailed at 374 closings and 20 percent of the total.

Jenkinson says new communities are opening up in all three counties in 2015, so the figures by county should balance out this year.

Lastly, Real Estate Information Service mapped new-home starts and closings from January 2013 through September 2014. The peak figure was 400 combined starts and closings in summer 2014, while the low point was about 250 in late 2013. Closings hit its high mark last summer at just more than 300, and starts topped out at about 150 early last year.

“There has been steady growth in both of these areas during this time frame and with the builder confidence continuing to improve along with other market indicators, I project that both of these will see strong growth into 2015,” Jenkinson says.

Reach Jim Parker at 937-5542 or jparker@postandcourier.com.