Home prices are up 1.5%, and rates at 6%—see how this affects you.
As we enter the crisp embrace of fall 2024, many of you might wonder: What’s happening in the Midlands and Upstate South Carolina real estate market?
Whether you’re considering buying, selling, or simply curious, here are the crucial details that you need to know about our local market:
Steady home prices amidst changing times. Over the past two years, median home prices have remained relatively flat in the Midlands and the Upstate. The median home price in the Midlands is currently $274,000, up about 1.5% from last year. Similarly, the Upstate has seen a 1.5% increase, bringing the median home price to $325,000.
Rising days on the market. The number of days homes spend on the market has climbed this year, mainly due to rising interest rates that started about a year and a half ago. In the Midlands, the average number of days on the market has increased to 45, a 15% rise over last year. The Upstate isn’t far behind, with an average of 40 days on the market, marking a 5.5% increase.
Inventory levels and market balance. Economists often consider a six-month supply of homes to be a balanced market. The Midlands has a 2.7-month supply, up 35% from last year. The Upstate has a 3.8-month supply, a significant 52% increase over last year. Despite these increases, we still face a shortage compared to the ideal six-month supply.
The housing affordability challenge. We’re in a unique situation where home prices continue to rise slowly, but interest rates fluctuate. We started the year with mortgage rates around 6%, saw a dip to about 5%, and now they’re hovering around 6% again. Even after the Federal Reserve lowered interest rates by half a point in late September, mortgage rates have not followed suit because they typically track the ten-year Treasury yield.
What this means for buyers and sellers. Many economists believe that as the Fed continues to lower interest rates, mortgage rates will eventually decrease, making home buying more affordable. When that happens, homeowners looking to sell and buy anew may find the prospect more appealing, potentially locking in a 4.5% or 5% mortgage rate instead of the current 6%.
While it’s tempting to wait for interest rates to drop, consider this: median home prices are expected to rise by 2% to 5% annually. If you’re renting, remember that “the interest rate on renting is 100%”—every dollar spent on rent is a dollar not invested in your property.
As we manage this evolving market, staying informed and considering all factors affecting your real estate decisions is crucial. Just as the leaves change, so does the market, and being prepared can make all the difference.
If you have questions or need guidance on your real estate transactions and aspirations, I’m here to help. Contact me at (803) 924-0564 or brentd@thedowningteam.com, and let’s work together to find the best path forward for you.
