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Sep 11, 2020
C O M P R E H E N S I V E H O U S I N G M A R K E T A N A L Y S I S
Charleston-North Charleston, South Carolina
U.S. Department of Housing and Urban Development Office of Policy Development and Research As of January 1, 2015
rle s t
on B erkeley
Beaufort Atlantic Ocean
Housing Market Area The Charleston-North Charleston Housing Market Area (here- after, the Charleston HMA), coterminous with the Charleston- North Charleston, SC Metropolitan Statistical Area, consists of Berkeley, Charleston, and Dorchester Counties. Along the Atlantic Coast in South Carolina, the central city of Charles- ton, the oldest city in the state, has a strong military presence and is a popular domestic tourist destination.
Summary Economy Nonfarm payroll growth in the Charleston HMA is strong, and growth has increased every year since 2010. During 2014, nonfarm payrolls totaled 321,600 jobs, increasing by 9,500 jobs, or 3.0 per- cent, from 2013. During the 3-year forecast period, nonfarm jobs are expected to increase an average of 2.4 percent annually. Joint Base Charleston (JBC) employs 22,000 military and civilian personnel. The two largest private employers in the HMA are Medical Univer- sity of South Carolina (MUSC) and Cummins Engine Co. Inc., with a combined 23,000 employees.
Table DP-1 at the end of this report provides additional employment data.
Sales Market The sales housing market in the HMA is balanced as of January 1, 2015, with a sales vacancy rate estimated at 1.7 percent, down from 3.0 percent in April 2010. During the 3-year forecast period, demand is estimated for 13,950 new homes (Table 1). The 1,500 homes currently under construc- tion and a portion of the approxi- mately 17,400 other vacant units that may return to the sales market will satisfy some of the demand.
Rental Market Rental housing market conditions in the HMA are currently soft but have improved since 2010. The overall rental vacancy rate is estimated at 9.0 percent, down
from 13.9 percent in 2010. Condi- tions in the apartment market are currently balanced. During the forecast period, demand is expected for 3,575 new rental units (Table 1). The 2,300 units cur- rently under construction will meet a portion of the demand.
Table 1. Housing Demand in the Charleston-North Charleston HMA During the Forecast Period
Charleston-North Charleston HMA
Total demand 13,950 3,575
Under construction 1,500 2,300
Notes: Total demand represents estimated production necessary to achieve a balanced market at the end of the forecast period. Units under construction as of January 1, 2015. A portion of the estimated 17,400 other vacant units in the HMA will likely satisfy some of the forecast demand. The forecast period is January 1, 2015, to Janu- ary 1, 2018. Source: Estimates by analyst
Market Details Economic Conditions ............... 2
Population and Households ..... 5
Housing Market Trends ............ 6
Data Profile ............................. 10
2 Economic Conditions
Economic conditions in the Charleston HMA were strong during most of the 2000s because of the growing healthcare and high- technology industries and the sup- port that a large number of smaller companies in the professional and business services sector provide to these expanding industries, includ- ing call centers and administrative support jobs. From the end of 2001 through 2008, nonfarm payrolls in- creased by an average of 6,200 jobs, or 2.2 percent. During this period, the professional and business services and the education and health services sectors led growth, increasing an- nually by 1,400 jobs, or 3.9 percent, and 1,200 jobs, or 4.2 percent, respectively. Combined, both sectors accounted for more than 40 percent of the total annual job growth in the HMA during this period. Ap- proximately 55 percent of the gains in the professional and business services sector occurred partially as a result of nearly 20 administrative and support companies opening or ex- panding, adding nearly 1,700 jobs in the HMA. These jobs are associated with the expanding healthcare and high-technology industries, including MUSC; Google, Inc.; and BAE Systems. The expansion of these industries is the result of a growing population and the relatively low cost of doing business in the HMA. In 2007, Google, Inc., opened a $600 million state-of-the-art data center and employed 200 workers. GenPhar, Inc., a biopharmaceutical company, also added 133 new jobs to the HMA the same year. In 2009, BAE Systems, a technology profes- sional services company, added 175 additional jobs to the HMA.
After nonfarm payrolls peaked at 301,900 jobs in 2008, the number
of jobs declined by 15,700, or 5.2 percent, to 286,200 jobs in 2009 as a result of the national recession. The largest decline occurred in the mining, logging, and construction sector, where 3,600 jobs were lost, a decrease of 18.9 percent; ap- proximately 98 percent of the losses occurred in the construction subsec- tor when homebuilding slowed with the declining economy. In 2010, the economy began to recover, gain- ing an average of 6,500 jobs, or 2.2 percent, annually through 2013. During this time, the professional and business services and the leisure and hospitality sectors led growth, increasing annually by 1,500 and 1,000 jobs, or 3.6 and 2.6 percent, respectively, coinciding with the growing economy and a strengthen- ing in domestic tourism in the HMA after the recession. In 2012, SPARC, an information technology services and software development company, expanded into the HMA, hiring 310 workers.
After strong job gains from 2010 through 2013, the rate of job growth accelerated in 2014. During 2014, nonfarm payrolls averaged 321,600 jobs, an increase of 9,500, or 3.0 per- cent, compared with 2013 (Table 2), the highest number of jobs recorded in the HMA. During this time, the leisure and hospitality sector led growth, followed by the professional and business services sector, increas- ing by 2,100 and 2,000 jobs, or 5.3 and 4.3 percent, respectively. In 2014, the HMA received approximately 4.9 million visitors, leading to ap- proximately $3.3 billion in economic impact on the metropolitan area compared with approximately 4.8 million visitors and an estimated economic impact of $3.2 billion in 2013 (Office of Tourism; College
of Charleston). APAC Customer Services, Inc., a customer care and outsourcing services company with clients in the healthcare and high- technology industries, added 200 new jobs to the HMA in 2014. The education and health services sec- tor, another top performing sector in 2014, has had the largest sec- tor growth since 2000 (Figure 1).
MUSC, the largest private employer in the HMA (Table 3), has 13,000 employees and had an annual eco- nomic impact on the HMA of $2.3 billion in 2010 (2010 MUSC report; latest data available). In 2014, MUSC completed construction of a $43.7 million, 78,000-square-foot, medical office building and a 2,800-square- foot medical research building, adding approximately 40 new jobs to the HMA. Roper St. Francis Health- care, the only not-for-profit health- care system in the HMA, currently employs 5,300 workers. In mid-2014, Roper announced plans to expand in the HMA with a 60,000-square-foot medical office building in the North Charleston area, with job gains ex- pected to be minimal. During 2014, the mining, logging, and construc- tion sector had the greatest rate of growth, at 7.3 percent, an increase of 1,100 jobs, as residential construction reached the highest level since 2007. The manufacturing sector has ac- counted for approximately 12 percent of net job growth since 2010, when
Table 2. 12-Month Average Nonfarm Payroll Jobs in the Charleston- North Charleston HMA, by Sector
12 Months Ending Absolute Change
Total nonfarm payroll jobs 312,100 321,600 9,500 3.0 Goods-producing sectors 39,000 40,800 1,800 4.6
Mining, logging, & construction 15,000 16,100 1,100 7.3 Manufacturing 24,000 24,700 700 2.9
Service-providing sectors 273,200 280,800 7,600 2.8 Wholesale & retail trade 44,800 46,300 1,500 3.3 Transportation & utilities 13,600 13,800 200 1.5 Information 5,000 5,200 200 4.0 Financial activities 12,900 13,400 500 3.9 Professional & business services 46,400 48,400 2,000 4.3 Education & health services 35,300 36,500 1,200 3.4 Leisure & hospitality 39,500 41,600 2,100 5.3 Other services 13,000 13,300 300 2.3 Government 62,600 62,300 – 300 – 0.5
Notes: Numbers may not add to totals because of rounding. Based on 12-