Year-End 2022 Performance Snapshot
Island-wide home sales: -34.3% YoY
Island-wide home median: $924,000, +15.6% YoY
Island-wide villa sales: -25.0% YoY
Island-wide villa median: $430,000, +20.1% YoY
Sea Pines home sales: -32.3% YoY
Sea Pines home median: $1,275,000, +10.9% YoY
Sea Pines villa sales: -24.2% YoY
Sea Pines villa median: $710,000, +25.0% YoY
Sea Pines home inventory: 41 homes listed (~1% of existing stock)
Sea Pines villa inventory: 13 villas listed out of ~2,000
National context: Island list-to-sale ratio averaged 99.4% in 2022; historical average 95%
We’re delighted to report the real estate market on Hilton Head Island enjoyed another successful year in 2022 with the median sales price for homes and villas reaching new highs, but severe inventory constraints and troubling economic headwinds tripped up buyers throughout the year causing sales transactions to tumble.
Never has so much been accomplished, with so little, as was done last year on Hilton Head Island. As 2022 began, the inventory for homes and villas around the Island were down to record lows of less than 1/2 of 1%. In Sea Pines for example, only 9 homes and 9 villas were listed for sale out of approximately 5,881 units.
When the market’s momentum ran out of steam in the second quarter, inventories slowly rose until they peaked in September at roughly 1%, consisting of 173 homes and 191 villas listed for sale across the Island. During the fourth quarter, through a combination of sales and fewer listings coming to the market, inventories began a steady retreat, and by year’s-end, only 127 homes and 151 villas were listed for sale.
Determination was the operative word for buyers in the real estate market last year as inflation climbed to 40 year highs to create a wall of worry. Nevertheless, facing record low inventories and an uncertain economic future, over 2000 families sank their toes into our sandy beaches and began living their Hilton Head Island dream.
A Look at the Numbers
2022 Hilton Head Island Home Market Performance
Homes sold Island-wide fell a steep 34.3% year over year but the median sales price increased 15.6% to $924,000.
2022 Hilton Head Island Villa Market Performance
Villas sold Island-wide decreased 25% year over year while the median sales price gained 20.1% to $430,000.
2022 Sea Pines Home Market Performance
Homes sold in Sea Pines dropped 32.3% year over year but the median sales price appreciated 10.9% to $1,275,000.
2022 Sea Pines Villa Market Performance
Villas sold in Sea Pines sank 24.2% year over year while the median sales price climbed 25% to $710,000.
For a comprehensive review of the Hilton Head Island MLS sales data for 2022, including both on and off-island, please click the links below:
The Question on Top of Mind for 2023
Will the economy cause the real estate market to roll over on Hilton Head Island, or can the gains of the last three years be consolidated into a new pricing floor?
Consumer confidence is the key indicator to watch for which direction the Island’s real estate market will go this year.
If a hard recession takes hold, and consumer confidence is given time to stew in a pot of pessimism, buyers are likely to see favorable changes coming their way.
It’ll show up first as a general malaise settling over the market with turnkey properties languishing in search of a buyer. Weaker offers and seller concessions are sure to follow. This should cause the list-to-sales price ratio to return to its historical average of 95% on the Island. Inventories were so tight last year that homes and villas sold at an average of 99.4% of their asking price.
If these cascading events unfold over the course of the year, it’s likely to lead to an accumulation of inventory, and if inventories can approach 3% on the Island, we’ll be well on our way to restoring a balance between sellers and buyers.
It’s worth noting that over the years Hilton Head Island has shown a pattern of being the last to feel the pains of a recession and the first to bounce out of them.
There’s an equally good chance for a solid pricing floor to develop this year. Even in the darkest days of the Great Real Estate Recession, properties were still being purchased by folks eager to start living the good life on Hilton Head Island.
Demand remains ever-present with buyers patiently waiting for the right property to come along or for better conditions to materialize.
But with so little inventory for sale, and a history of buyers willing to purchase under any and all economic conditions, it’s likely that enough demand comes through to keep inventories persistently low and pricing elevated this year.
As a prelude, during the last four months of 2022, the median sales price for homes on the Island increased slightly by .54% while villas slipped 2.1%. During this same period, homes in Sea Pines gained 1.59% and villas rose 2.6%.
The Most Important Takeaway
Timing the market is more luck than skill but finding the right property, for all the right reasons, can be a priceless return on the experiences you’ll share with your family and friends.
As facilitators to dreams coming true, we welcome the opportunity to help you realize yours on Hilton Head Island.
Please call us today and let’s get started!
Thank you and Happy New Year,
