2024 Residential Market Update slide deck from Dr. Joey Von Nessen showing data from the residential real estate market in Charleston, South Carolina. Provided by the Charleston Regional Multiple Listing Service and the Charleston Trident Association of Realtors.

1. THE 2024 SOUTH CAROLINA
ECONOMIC OUTLOOK
Joseph Von Nessen, Ph.D.
Research Economist
January 17, 2024
joey.vonnessen@moore.sc.edu

2. THE MOST PREDICTED RECESSION IN HISTORY?
2021
2022
2023
2024…

3. WHY?
THE U.S. ECONOMY HAS BEEN
OVERHEATED AND IS SLOWLY
COOLING DOWN

4. THE GOOD, THE BAD, & THE UGLY!
• THE SOUTH CAROLINA ECONOMY CONTINUES TO BE RESILIENT
IN THE FACE OF A MAJOR POST-COVID READJUSTMENT
• THERE ARE HEADWINDS STILL FIGHTING THE FEDERAL RESERVE
ON INFLATION THAT COULD PERSIST THROUGHOUT 2024
• THE LIKELIHOOD OF RECESSION HAS DECREASED, BUT WE’RE
NOT OUT OF THE WOODS YET

5. THE THEME OF 2024
READJUSTMENT!

6. SOUTH CAROLINA EMPLOYMENT TRENDS
Source: U.S. Bureau of Labor Statistics, CES-SA
1,700.0
1,800.0
1,900.0
2,000.0
2,100.0
2,200.0
2,300.0
2,400.0
South Carolina employment levels currently
5.9% above pre-pandemic peak…
Nov.’21 – Nov.’23: +3.0%
Nov.’10 – Nov.’19: +2.1%

7. TOTAL ASSETS OF U.S. HOUSEHOLDS
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
Owner-Occupied Real Estate Consumer Durable Goods Total Financial Assets
Source: Board of Governors, U.S. Bureau of Economic Analysis; Asset Value/Nominal GDP
Financial Assets
Real Estate Assets
Durable Goods Assets

8. REAL U.S. CONSUMER SPENDING
Source: U.S. Bureau of Economic Analysis, in billions
$11,000
$11,500
$12,000
$12,500
$13,000
$13,500
$14,000
$14,500
$15,000
$15,500
$16,000

9. REAL U.S. CONSUMER SPENDING
Source: U.S. Bureau of Economic Analysis, in billions
Goods Services
$3,500
$4,000
$4,500
$5,000
$5,500
$6,000
$6,500
$7,000
$7,500
$8,000
$8,500
$9,000
$9,500
$10,000
$10,500
We are still readjusting from
the “goods bubble” that
drove the surge in
manufacturing and housing

10. Source: U.S. Bureau of Labor Statistics, CES-SA
PCT. EMPLOYMENT GAINS SINCE FEBRUARY 2020
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
5.9%
12.7%
4.9% 5.3%
6.6%
4.4%
8.8%
3.8%
2.0%

11. 0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
2022/2021 2023/2022
Source: U.S. Bureau of Labor Statistics, CES-SA
S.C. ANNUAL EMPLOYMENT GROWTH: 2023 VS. 2022
The biggest year/year pullback has
been in regions that are driven by the
goods market

12. THE GOOD NEWS
• STEADY CONSUMER SPENDING
• A HEALTHY LABOR MARKET
• HOUSEHOLD FINANCIAL RESOURCES ARE
STABILIZING

13. THE BAD NEWS
INFLATION AND RISING INTEREST RATES HAVE
TAKEN THEIR TOLL ON PURCHASING POWER

14. WAGE GROWTH AND INFLATION RATES
Source: U.S. Bureau of Labor Statistics
Dec. 2023 vs. Dec. 2020
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%
U.S. Avg. Hourly Earnings
U.S. Inflation Rate
U.S. Inflation Rate (Food)
U.S. Inflation Rate (Energy)
14.5%
17.9%
20.6%
36.5%

15. -2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Jan.'11
Jul.'11
Jan.'12
Jul.'12
Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16
Jan.'17
Jul.'17
Jan.'18
Jul.'18
Jan.'19
Jul.'19
Jan.'20
Jul.'20
Jan.'21
Jul.'21
Jan.'22
Jul.'22
Jan.'23
Jul.'23
INFLATION VS. CONSUMER SENTIMENT
Source: U.S. Bureau of Labor Statistics & University of Michigan
U.S. Inflation Rate U.S. Consumer Sentiment
40
50
60
70
80
90
100
110
Jan.'11
Jul.'11
Jan.'12
Jul.'12
Jan.'13
Jul.'13
Jan.'14
Jul.'14
Jan.'15
Jul.'15
Jan.'16
Jul.'16
Jan.'17
Jul.'17
Jan.'18
Jul.'18
Jan.'19
Jul.'19
Jan.'20
Jul.'20
Jan.'21
Jul.'21
Jan.'22
Jul.'22
Jan.'23
Jul.'23

16. HOUSING MARKETS REPRESENT THE FRONT
LINES IN THE BATTLE AGAINST INFLATION

17. -2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Jan.'11
Apr.'11
Jul.'11
Oct.'11
Jan.'12
Apr.'12
Jul.'12
Oct.'12
Jan.'13
Apr.'13
Jul.'13
Oct.'13
Jan.'14
Apr.'14
Jul.'14
Oct.'14
Jan.'15
Apr.'15
Jul.'15
Oct.'15
Jan.'16
Apr.'16
Jul.'16
Oct.'16
Jan.'17
Apr.'17
Jul.'17
Oct.'17
Jan.'18
Apr.'18
Jul.'18
Oct.'18
Jan.'19
Apr.'19
Jul.'19
Oct.'19
Jan.'20
Apr.'20
Jul.'20
Oct.'20
Jan.'21
Apr.'21
Jul.'21
Oct.'21
Jan.'22
Apr.'22
Jul.'22
Oct.'22
Jan.'23
Apr.'23
Jul.'23
Oct.'23
U.S. INFLATION RATE (YEAR/YEAR)
Source: U.S. BLS, Consumer Price Index, December 2023
+3.4%
Federal Reserve target of 2.0%
+9.1%

18. GROWTH IN U.S. HOUSING COSTS: 2014-2023
Source: Zillow and U.S. Bureau of Labor Statistics
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Zillow Home Value Index CPI: Shelter Costs
Note that housing costs have been
rising at a slower rate in 2023, but
they are not decreasing.

19. 0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
U.S. MORTGAGE INTEREST RATES
Source: 30-Year Fixed Rate Monthly Average, Freddie Mac
6.8%

20. 300
400
500
600
700
800
900
1,000
1,100
TOTAL U.S. SINGLE-FAMILY HOUSING SALES
Source: U.S. Census Bureau, US HUD
in thousands

21. CHARLESTON HOUSING SALES
Source: CTAR Multiple Listing Service, 12-month rolling average
-
500
1,000
1,500
2,000
2,500
Dec.’19 vs. Dec.’23

22. THE BULK OF THE HOUSING
MARKET’S SALES READJUSTMENT
PERIOD IS LIKELY BEHIND US!

23. ANNUAL GROWTH IN CHARLESTON HOUSING SALES
Source: CTAR Multiple Listing Service
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%

24. CHARLESTON HOUSING SALES VS. MEDIAN PRICE
Source: CTAR Multiple Listing Service, 12-month rolling average
400
600
800
1,000
1,200
1,400
1,600
1,800
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
Jan.'10
May.'10
Sept.'10
Jan.'11
May.'11
Sept.'11
Jan.'12
May.'12
Sept.'12
Jan.'13
May.'13
Sept.'13
Jan.'14
May.'14
Sept.'14
Jan.'15
May.'15
Sept.'15
Jan.'16
May.'16
Sept.'16
Jan.'17
May.'17
Sept.'17
Jan.'18
May.'18
Sept.'18
Jan.'19
May.'19
Sept.'19
Jan.'20
May.'20
Sept.'20
Jan.'21
May.'21
Sept.'21
Jan.'22
May.'22
Sept.'22
Jan.'23
May.'23
Sept.'23
Median Sales Price Total Sales

25. U.S. TOTAL INVENTORY OF EXISTING HOMES
Source: National Association of REALTORS
in millions
0
0.5
1
1.5
2
2.5
3
3.5
4

26. DAYS-ON-MARKET: CHARLESTON, SC
Source: CTAR Multiple Listing Service
0
20
40
60
80
100
120
140
160
DOM is down about 45% in
2023 compared to 2019

27. WHAT PERCENTAGE OF PENDING SALES REPRESENTS
NEW CONSTRUCTION IN CHARLESTON?
2019: 28%
2023: 50%
Source: Carolina One New Homes

28. WHAT DOES THIS IMPLY FOR HOUSING
MARKETS IN 2024?

29. PRIMARY FACTORS INFLUENCING
HOUSING DEMAND IN 2024
• MORTGAGE INTEREST RATES
• STRENGTH OF THE LABOR MARKET
• POPULATION GROWTH

30. PRIMARY FACTORS INFLUENCING
HOUSING DEMAND IN 2024
• MORTGAGE INTEREST RATES
• STRENGTH OF THE LABOR MARKET
• POPULATION GROWTH

31. Source: U.S. Census Bureau
POPULATION GROWTH TRENDS IN THE U.S.

32. FED IS CONTINUING TO WALK A
TIGHTROPE!
SO FAR, A SOFT LANDING IS ON TRACK…

33. U.S. INFLATION VS. WAGE GROWTH
Source: U.S. Bureau of Economic Analysis
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Annual Wage Growth CPI: All Items
April 2021
May 2023

34. REAL U.S. PERSONAL DISPOSABLE INCOME
Source: U.S. Bureau of Economic Analysis, in billions
$12,000
$13,000
$14,000
$15,000
$16,000
$17,000
$18,000
$19,000
$20,000
$21,000

35. Source: U.S. Bureau of Labor Statistics, in billions
REAL TOTAL U.S. CONSUMER SPENDING
$13,000
$13,500
$14,000
$14,500
$15,000
$15,500
$16,000
Jan.'21 Apr.'21 Jul.'21 Oct.'21 Jan.'22 Apr.'22 Jul.'22 Oct.'22 Jan.'23 Apr.'23 Jul.'23 Oct.'23

36. U.S. JOB OPENINGS RATE
Source: U.S. Bureau of Labor Statistics
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%

37. TOTAL SOUTH CAROLINA EMPLOYMENT
Source: U.S. Bureau of Labor Statistics
in thousands
2,000.0
2,050.0
2,100.0
2,150.0
2,200.0
2,250.0
2,300.0
2,350.0
Jan.'21
Feb.'21
Mar.'21
Apr.'21
May.'21
Jun.'21
Jul.'21
Aug.'21
Sept.'21
Oct.'21
Nov.'21
Dec.'21
Jan.'22
Feb.'22
Mar.'22
Apr.'22
May.'22
Jun.'22
Jul.'22
Aug.'22
Sept.'22
Oct.'22
Nov.'22
Dec.'22
Jan.'23
Feb.'23
Mar.'23
Apr.'23
May.'23
Jun.'23
Jul.'23
Aug.'23
Sept.'23
Oct.'23
Nov.'23

38. S.C. INITIAL UNEMPLOYMENT INSURANCE CLAIMS
Source: S.C. Dept. of Emp. & Workforce
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000 1/2/21
2/2/21
3/2/21
4/2/21
5/2/21
6/2/21
7/2/21
8/2/21
9/2/21
10/2/21
11/2/21
12/2/21
1/2/22
2/2/22
3/2/22
4/2/22
5/2/22
6/2/22
7/2/22
8/2/22
9/2/22
10/2/22
11/2/22
12/2/22
1/2/23
2/2/23
3/2/23
4/2/23
5/2/23
6/2/23
7/2/23
8/2/23
9/2/23
10/2/23
11/2/23
12/2/23
Weekly average initial
claims level: 2017-2019

39. WHAT ABOUT MORTGAGE
INTEREST RATES?

40. WHAT ABOUT MORTGAGE
INTEREST RATES?
THE KEY DRIVER WILL BE
INFLATION’S “STICKINESS”

41. AN INFLATION TUG-OF-WAR
LABOR SHORTAGE
U.S. MOVEMENT AWAY
FROM GLOBALIZATION
HOUSING COSTS

42. THE BOTTOM LINE
• The South Carolina economy cooled in 2023 as the effects of rising interest rates
and high inflation have taken their toll.
• Slower growth is expected for the state in 2024, but South Carolina’s economy
remains relatively healthy and continues to benefit from steady consumer spending,
wage growth, and a strong labor market.
• The bulk of the housing market’s readjustment period is likely behind us. Sales
activity will likely stabilize in 2024 with relatively flat or small, positive growth.
• High inflation remains the single biggest short-run economic threat. If inflation does
not continue its downward trajectory, the Fed may leave interest rates higher for
longer, which could further slow the U.S. economy and housing markets.
• The odds of a recession have gone down, but the outcome of this period of
economic readjustment is still far from certain.

43. THANK YOU!