Charleston offers opportunity, affordability that is waning elsewhere
While some housing markets in the United States struggle with affordability or even availability, others are flourishing and should continue to do so through at least 2024, if not longer.
Take the Charleston market for example. A jewel of the southeast, Charleston is poised to have the renaissance that Charlotte has had in the previous decades. Charlotte spent the better part of the last 20 years growing to become one of the 20 biggest cities in the country (No.16 as of May 2019), however, while it’s still one of only a handful of top 20 cities showing growth, it has started to taper off a little bit.
That’s because just three hours to the south in Charleston, there is opportunity and affordability aplenty.
It, along with several other markets that are doing well, should all outperform initial projections for that market over the next three to five years, according to a study released in December by the National Association of REALTORS® (NAR).
“Some markets are clearly positioned for exceptional longer-term performance due to their relative housing affordability combined with solid local economic expansion,” said NAR’s Chief Economist Lawrence Yun. “Drawing new residents from other states will also further stimulate housing demand in these markets, but this will create upward price pressures as well, especially if demand is not met by increasing supply.”
The 10 most notable markets expected to outperform projections also included Charlotte, Colorado Springs, Colo., Columbus, Ohio, Dallas-Fort Worth in Texas, Fort Collins, Colo., Las Vegas. Ogden, Utah, Raleigh-Durham-Chapel Hill in North Carolina and Tampa-St. Petersburg in Florida.
There were a number of factors that made these markets project to be the hottest as far as real estate over the next half-decade, including job growth compared to the national average, housing affordability, the structure of the age population, their attractiveness to retirees, how likely they are to attract new residents from out of the area and also the appreciation of home prices over time.
“Potential buyers in these markets will find conditions especially favorable to purchase a home going into the next decade,” said NAR President Vince Malta, a broker at Malta & Co., Inc., in San Francisco. “The dream of owning a home appears even more attainable for those who move to or are currently living in these markets.”
About 16 percent of the total population in the Charleston market (approximately 121,500 people) moved into the area recently, and 64 percent of those are renters.
However, nearly half (45 percent) of those recently moved renters can afford to buy a home at the median price of $281,400 assuming a 20 percent down payment. The median income of individuals who have recently moved to Charleston is $55,900, which would also indicate those looking for workforce housing (middle-income earners) are finding what they need in this market.
The median age of these folks moving to the area is 29 years old, which is on the younger side for most markets. Considering 55 percent of them are married couples or families, it’s a sure bet that these individuals are looking for a place to set down roots for their families while finding a place that is affordable to live and work. The remaining 45 percent are single individuals, and considering the median age, they are likely looking to begin their careers in a place they can afford to live. The average length of time for people to own a home in Charleston is nine years.
While a majority of recent movers have come from other parts of South Carolina, a significant number of people are moving from the New York, Atlanta, Baltimore and Washington D.C. metro markets and the aforementioned migration from Charlotte.
Charleston has always been a must-stop on the vacationer’s tour of the South East. With its history and colorful architecture and its convenience to the Atlantic Ocean as a port city, it’s always been an attractive pit stop for travelers. However, now, it’s on the verge of becoming a place people want to call home, not just visit.