2016 Year in Review | CTAR Residential Market Update | Dr. Von Nessen

Joseph
Von
Nessen,
Ph.D.

Research
Economist

January
18,
2017

joey.vonnessen@moore.sc.edu

Economic growth leveling off
A tighter labor market
Strong housing demand
1
2
3

South Carolina Employment Growth
Source: Bureau of Labor Statistics, Current Employment Statistics, NSA
0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

Jan.'11
Jul.'11
Jan.'12
Jul.'12
Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16

South Carolina Employment Growth
0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

Jan.'11
Jul.'11
Jan.'12
Jul.'12
Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16

+2.2%

Slower

Global

Growth/
App.

Dollar

Declines
in

Demand
for

Exports

Declines
in

Manufacturing

(Trans.
Equipment)

Declines
in

TransportaBon/
Trucking

Ripple Effects

China/U.S. Foreign Exchange Rate
Source:
Board
of
Governors
of
the
Federal
Reserve
System

5.6

5.8

6.0

6.2

6.4

6.6

6.8

7.0

Jan.'12
Jul.'12
Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16

S.C. Export Volume (TEUs)
Source:
South
Carolina
Ports
Authority

-‐15.0%

-‐10.0%

-‐5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

Trans.
&
U9l
Manufacturing

5.3%

2.5%

2.0%
1.9%

2015/2014
2016/2015

S.C. Employment Growth: By Industry

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

Jan.'15
Jul.'15
Jan.'16
Jul.'16

S.C. Employment Growth: Trans. Equip. Manuf.
2016 South Carolina Employment Growth Rate

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

Jan.'15
Jul.'15
Jan.'16
Jul.'16

Construc9on
Prof.
&
Bus.
Services
Health
Care
&
Soc.
Assist.

S.C. Employment Growth: By Industry
2016 South Carolina Employment Growth Rate

S.C. Avg. Employment Growth: 2015-2016
Fairﬁeld

12.2
%

Avg. Growth: +2.2%
Source: BLS, Current Employment Statistics, NSA
3.2%
1.5%
1.2%
0.5%
1.4%
1.7%
1.4%

Outlook for 2017: Employment Growth
Source: Division of Research, Moore School of Business
0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

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2.9%

2.4%

3.0%

2.5%
2.6%
2.5%
2.4%
2.3%

2.5%
2.6%

2.4%
2.5%

Historical
Forecast

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

11.0%

12.0%

13.0%

U.S.
S.C.

Unemployment Rates
Source: Bureau of Labor Statistics; SA LAUS, CES
SC: 4.4%
US: 4.7%

4.4%

-‐6.0%

-‐4.0%

-‐2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Jan-‐09

Jun-‐09

Nov-‐09

Apr-‐10

Sep-‐10

Feb-‐11

Jul-‐11

Dec-‐11

May-‐12

Oct-‐12

Mar-‐13

Aug-‐13

Jan-‐14

Jun-‐14

Nov-‐14

Apr-‐15

Sep-‐15

Feb-‐16

Jul-‐16

S.C. Average Hourly Earnings (Total: Private)

S.C. Average Hourly Earnings (Total: Private)
Region
Oct.
2015
Oct.
2016
%
Change

Charleston
$23.01
$24.39
+6.0%

Columbia
$22.58
$22.41
-‐0.8%

Greenville
$21.09
$21.80
+3.4%

Myrtle
Beach
$18.86
$19.89
+5.5%

Spartanburg
$20.60
$21.22
+3.0%

State
Total
$21.53
$22.47
+4.4%


Outlook for 2017: Total Personal Income Growth
0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

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5.2%
5.1%

5.6%

4.9%
4.9%

4.3%

3.7%

5.1%

4.8%
4.8%
4.7%
4.7%

Historical
Forecast

U.S. Skills Gap Misery Index
0

50

100

150

200

Dec-‐00

Sep-‐01

Jun-‐02

Mar-‐03

Dec-‐03

Sep-‐04

Jun-‐05

Mar-‐06

Dec-‐06

Sep-‐07

Jun-‐08

Mar-‐09

Dec-‐09

Sep-‐10

Jun-‐11

Mar-‐12

Dec-‐12

Sep-‐13

Jun-‐14

Mar-‐15

Dec-‐15

Source: Bureau of Labor Statistics; SA LAUS, JOLTS

1.5

2

2.5

3

3.5

4

4.5

5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
11.0%
12.0%

2007-‐2010
2011-‐2016

S.C.
Unemployment
Rate

The Beveridge Curve
Source: Bureau of Labor Statistics; SA LAUS, JOLTS
U.S.
Job
Openings
Rate

South Carolina Demographic Profile
Source: American Community Survey, PUMS, 2010-2014 (Ages 25-65)
54.5%

45.5%

<Associate's
Associate's
or
Higher

Movers LTM Non-Movers
64.8%

35.2%

<Associate's
Associate's
or
Higher

Mover
LTM
Non-‐Mover

Management
8.1%
7.7%

Engineering
2.1%
1.5%

Military
8.9%
0.4%

Oﬃce
11.6%
13.2%

ConstrucBon
4.0%
5.3%

ProducBon
4.2%
8.5%

TransportaBon
5.3%
6.4%

S.C. Pct. Employed by Selected Occupations
Source: American Community Survey, PUMS, 2010-2014

South Carolina Initial Unemployment Insurance Claims
Source: U.S. Department of Labor, Initial UI Claims, 12-week moving average
0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

3/18/00

3/18/01

3/18/02

3/18/03

3/18/04

3/18/05

3/18/06

3/18/07

3/18/08

3/18/09

3/18/10

3/18/11

3/18/12

3/18/13

3/18/14

3/18/15

3/18/16

Outlook for 2017: Unemployment Rate
0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

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6.5%

6.1%

5.6%
5.5%
5.6%
5.6%

5.1%

4.6%
4.6%
4.5%
4.7%
4.5%

Historical
Forecast

Construction Emp. Growth vs. S.C. Average
Source:
Bureau
of
Labor
StaMsMcs,
CES
NSA

-‐6.0%

-‐4.0%

-‐2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

Jan.'11
Jan.'12
Jan.'13
Jan.'14
Jan.'15
Jan.'16

S.C.
Construc9on

S.C. Regional Competitiveness by Industry
Pct. Point Difference Between National Industry Growth and S.C. Industry Growth
-‐2.0%
-‐1.5%
-‐1.0%
-‐0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%

Construc9on

Manufacturing

Durable
Goods

NonDurable
Goods

Wholesale
Trade

Retail
Trade

Trans.
&
U9l

Informa9on

Financial
Ac9v.

Prof.&Bus.

Health
&
Soc.Assist.

Leisure&Hosp.

Ongoing Stimulus Effects
(1) 2015 Flood
(2) Hurricane Matthew

What About the Charleston
Housing Market?

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16
Jan.'17
Jul.'17

Historical
Forecast

Outlook for 2017: MLS Sales Activity
+11.9%
+17.1%
+9.1%+30.9%
+8.1%

Charleston Quintile Analysis
$0

$100,000

$200,000

$300,000

$400,000

$500,000

2007
2008
2009
2010
2011
2012
2013
2014
2015
2016

Q1
Q2
Q3
Q4
Q5

Charleston Price Point Breakdown
<$100K

$100K-‐
$150K

$150K-‐
$200K

$200K-‐
$250K

$250K-‐
$300K

$300K-‐
$350K

$350K-‐
$400K

$400K+

2013
12.3%
14.3%
18.3%
14.7%
10.9%
6.8%
4.6%
18.1%

2014
10.7%
12.8%
18.2%
14.4%
11.8%
7.8%
5.3%
18.9%

2015
7.8%
10.1%
18.2%
16.3%
11.8%
8.8%
5.5%
21.5%

2016
5.6%
8.1%
16.9%
18.4%
12.5%
9.3%
6.7%
22.3%

-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐-‐

2016/2013
-‐6.7%
-‐6.1%
-‐1.3%
3.7%
1.6%
2.6%
2.1%
4.2%

2016/2015
-‐2.2%
-‐2.0%
-‐1.3%
2.1%
0.7%
0.5%
1.3%
0.9%

Charleston MLS: Median Price by Year
0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

2013
2014
2015
2016

6.0%
5.7%

6.2%

4.6%

S.C. Employment Growth: Construction
Source:
Bureau
of
Labor
StaMsMcs,
Current
Employment
StaMsMcs,
NSA

-‐25.0%

-‐20.0%

-‐15.0%

-‐10.0%

-‐5.0%

0.0%

5.0%

10.0%

15.0%

Construc9on
of
Buildings
Specialty
Trade
Contractors

FHFA House Price Index
Source: U.S. Federal Housing Finance Agency
-‐15.0%

-‐10.0%

-‐5.0%

0.0%

5.0%

10.0%

15.0%

q110

q210

q310

q410

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q211

q311

q411

q112

q212

q312

q412

q113

q213

q313

q413

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q214

q314

q414

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q215

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q116

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q316

Charleston

Columbia

Greenville

Hilton
Head

Spartanburg

S.C. Builders Reporting at Least One Sale
Source: U.S. Bureau of Labor Statistics
(Residential & Non-Residential)
2,500

2,600

2,700

2,800

2,900

3,000

3,100

2011
2012
2013
2014
2015
2016

Will the U.S. Dollar
Continue to Strengthen?

Gas Prices Low!
Consumer
Confidence High!

South Carolina’s Economy on Solid Footing for 2017
November
2016
State
Leading
Indices

Source:
Federal
Reserve
Bank
of
Philadelphia

2016 Year in Review | CTAR Residential Market Update | Dr. Von Nessen

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