Columbia is seeing construction for some new housing on Forest Drive, but the demand is rising daily. (Photos by Shamariah Vanderhorst/ Carolina News and Reporter)
South Carolina’s ongoing population growth is creating more jobs for Columbia residents but continues to make home affordability a challenge.
“With growth comes growing pains, right?” said Carl Blackstone, Columbia Chamber of Commerce CEO. “The growing pains you’re seeing in Charleston, the growing pains you’re seeing in Greenville are what we’re going to see in Columbia. We’ve got to find housing.”
Population increases in the South lead to more job opportunities. Numerous companies are investing in Columbia because of the need for workers.
Companies move to growing areas where it is easier to find more people to work, Blackstone said.
“There is a direct linkage to states that are growing their economy and growing population-wise,” Blackstone said. “They’re mutually dependent on each other.”
But population increases paired with the lack of affordable, newly built homes has led South Carolina to witness an overall housing shortage over the years, said Dr. Joseph Von Nessen, a research economist at the University of South Carolina.
“When you put those pieces together, a decade-long period of underbuilding, coupled with rising interest rates, that’s led to a shortage of supply for existing homes,” Von Nessen said. “That’s led to an overall lack of supply in the housing market.”
Von Nessen and USC’s Darla Moore School of Business helped conduct the Palmetto State Housing Study with the S.C. Housing Authority in 2023. The report highlighted the state’s growing needs.
“There is a major supply and demand imbalance that has put upward pressure on prices, and that’s created affordability challenges for many housing markets in South Carolina,” Von Nessen said.
South Carolina was the state with the fastest rate of population growth in America in 2023, according to the U.S. Census Bureau.
With a 1.7% growth rate that exceeded that of all other states, South Carolina saw a population increase of almost 90,000 people from July 2022 to July 2023.
“Housing costs do go up due to supply and demand, traffic gets worse,” said Ryan Coleman, the city of Columbia’s economic development director.
State lawmakers in 2023 set aside $25 million from the state’s Housing Trust Fund to create a tax credit to address the rising costs of construction, land and materials that are affecting the financial stability of numerous housing projects.
As for residents, many find it difficult to buy a home without support from programs such as Habitat for Humanity. But those programs also see challenges.
“We have approximately 22 families, they’re waiting for their forever home right now, and because the construction costs are at an all time high, it’s taking us a little bit longer to build a home,” said Brittani Richards, development director of Central South Carolina Habitat for Humanity. “A few years ago, … we used to build a home for like $72,000. Now, the cost to build a home with Habitat for Humanity here in the Midlands is $160,000.”
People who have the greatest need are often the people who fight the hardest to get a home, Richards said.
“Those are the ones that mean the most to me – to see the drive,” she said. “And it makes me want to work harder. … The one that I know that has really touched me would be Rickysha’s story and how homeownership was always her plan.”
Habitat doesn’t use full names for those who receive houses.
But Richards said Rickysha was able to make her purchase through the organization after months of actively working toward a new home by saving and by helping with construction, according to the organization’s 2023 Impact Report.
Affordability in South Carolina is a struggle for most, as the total cost of living can change according to the number of dependents in a household and other living expenses.
The median household income was $54,095 from 2018-2022 in Columbia, according to the census. Columbia’s average rent was $1,105, and a monthly mortgage was $1,492.
Columbia’s average hourly pay rate was $22.87 in January 2024, according to the Zip Recruiter website.
Households across all income levels will be affected by affordable housing as prices continue to rise.
“What we find in the study is about 90% of South Carolina’s lower-income households are estimated to be housing-cost burdened,” Von Nessen said. “But in South Carolina, there’s also a significant population base of middle-income households that also face affordability challenges.”
Columbia must address the rising supply and demand for housing as well as the locations, price points and markets where the supply is constrained in order to start looking for a solution, Von Nessen said.
That’s especially because prices rise when there’s more demand.
“Anyone who’s looking to buy a home, regardless of who they are, is likely seeing housing prices going up in their market in South Carolina,” Von Nessen said.