Low inventory, high demand lead to skyrocketing home prices

By now it’s no secret that 2020 was a booming year for Greenville’s residential real estate market.

“It was very brisk and very competitive,” said Nick Sabatine, CEO of the Greater Greenville Association of Realtors (GGAR). “Despite the pandemic, it was an exceptional year for real estate.”

By the looks of it, 2021 is on track to be even better.

Without exception, every month this year has seen higher sales of residential housing units in Greenville compared to the same month in 2020, according to data from GGAR’s multiple listing service.

Sabatine said the trend is not exclusive to Greenville.

“It’s the same here as it is all over: a strong seller’s market,” he said. “It’s just so competitive because of the low inventory.”

Low inventory and increased demand have sent prices skyrocketing in Greenville County. As of March, the average home sold for $240,042, an increase of nearly 10% compared to March of last year, according to Zillow’s home value index. 

Homebuilders are scrambling to keep up.

“They can’t build them fast enough,” said Taylor Lyles, executive vice president of the Greenville Home Builders Association. “I mean, it’s just incredible.”

The biggest challenge to building more homes is the supply chain. Material delays have led to homes sitting unfinished, while prices continue rising as lumber yards strive to meet the increased demand.

“That’s where a lot of the headaches and frustration comes from, not being able to get certain products to finish a house,” Lyles said. “Windows, lumber, whatever it might be. It’s destroying everybody. And by the time you do get it, the prices have gone up.”

It’s unlikely these trends, both good and bad, will abate any time soon, Lyles said.

The Home Builders Association is forecasting the market will continue growing through 2022, with a small dip likely in early 2023.

“But we’re not talking about a major drop,” Lyles said. “Maybe a 10- to 15% reduction in home sales, and then that’s where we think we’ll plateau.”

Sabatine agrees.

“I don’t want to try and make any strong predictions for 2022 but I can say I believe things will stay steady as they’ve been,” he said.

While the residential real estate market is surging nationwide, Greenville has seen particularly strong growth and its increasingly diverse economy will likely serve to insulate it  from any significant dips in the market ahead, Lyles said.

“Greenville is so insulated because we’ve got manufacturing, we’ve got technology, we’ve got the IT side of tech, we’ve got all this stuff right here, and as a result, the market is booming,” he said. “Growth is great, but what we’re hoping for is growth in the right way.”

Sales of housing units month-by-month

January 2020: 809

January 2021: 1,014

February 2020: 1,010

February 2021: 1,023

March 2020: 1,294

March 2021: 1,471

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