Learning about real estate will help you in any situation, but investors particularly need to know what the Charlotte real estate market is likely to do before they invest.
Roughly 70 percent of people are focusing on homeownership, meaning properties change hands all the time. The Charlotte housing market is an interesting case study. It's growing quickly, is close to various hotspots on the east coast, and the residents are highly educated because of the many universities and colleges.
There are also various career options, and people vote it as being the best place to raise families. Likewise, there's plenty of recreation and nature. We'll dive deep and help you determine if the Charlotte region is the best place for you.
Charlotte Housing Market Trends
Charlotte, NC, is currently one of the hottest markets right now. In fact, Queen City is growing quickly, which attracts families and young professionals because of the vibrant culture, excellent schools, and diverse neighborhoods.
Overall, the Charlotte real estate market is highly competitive. Home prices are on the rise, there's less inventory, and everyone wants to be here.
The Canopy Realtor Association has analyzed the housing market in Charlotte, and the figures focus on Lincoln, Iredell, Gaston, Cabarrus, Union, Rowan, and Mecklenburg. Likewise, South Carolina counties, such as York, Lancaster, and Chester, were included in the report.
Factors Affecting the Charlotte Housing Market
Based on the data provided, here are the metrics you should know that might affect the housing market in Charlotte.
The real estate inventory saw an increase of about 27.7 percent in April of 2023. This rise suggests there are more houses available compared to last year. That's encouraging for buyers and investors because it gives them more options. Still, the trend might not continue.
Charlotte is a beautiful area, but industries and businesses started setting up shop. Clearly, it saw potential, and people saw opportunities. In fact, many residents now feel it's a small Atlanta. Everyone knows about it, so they're searching for options to invest, and real estate is the prime goal.
However, the housing inventory, while increasing so far, is still low compared to the rest of the United States. Because the hot housing market has cooled, it shouldn't slow much in the near future.
Investors must have their financial ducks in a row before they enter the market. If they don't, they won't have the funds when opportunities arise. Likewise, they must research on their own or with a Realtor to get the best results.
Average Listing Prices
April 2023 saw an average list price of $523,738, which is an 8.3 percent increase from 2022. Year-to-date numbers were also increasing, and the average list price was $490,003 in 2023.
Days on Market
When sellers do sell, they sit on the market for about 39 days, which is a huge rise from 2022 (16 days). This 143.8 percent jump could benefit investors because they will likely have more purchasing power. Overall, they could get lower home prices if they know how to negotiate or use a real estate agent.
Charlotte is in the midst of a strong job market. There are many top employers, including Lowe's, Wells Fargo, and Bank of America. Overall, people relocate here all the time and need a Charlotte home they can rent.
Duke Energy and Bank of America hold headquarters in the city, so there's a large population and low unemployment rates. This should drive housing demands for the city.
Lucrative Rental Market
If you're investing in real estate, now is likely the time, and Charlotte is the best place to be. Many young professionals are flocking to the area, and families are coming here because of the beauty and low crime rates. Therefore, rental properties are on the rise. People aren't as interested in high mortgage rates and want to lower their risk; renting can help.
Therefore, rental rates have increased, as well. The main factor that contributes to rental market growth in the city is the demand for housing. Everyone wants to be in the urban core. In fact, families and professionals wish to live near enough to the vibrant downtown area to experience whenever they prefer without the aggravation of the busy lifestyle.
These people are willing to pay a high premium for the amenities and conveniences on offer. Therefore, new apartment buildings and mixed-use properties can be found. If you have the cash flow available, it's possible to jump on the bandwagon.
The Charlotte area is becoming the hottest trend in the US, and that's a good thing for landlords. People understand the promising options available to them, and they want to be part of it. Therefore, they're willing to pay higher prices to rent; renters don't have high mortgage rates, and they're taking full advantage of that.
Though rent is pricey now, it's rising steadily, as well. January 2023 saw the cost of rent go $50 higher than last year. With more job opportunities, renters are coming in droves. Landlords don't feel the need to lower the amounts for tenants. That's good news for investors who have the cash up front (or the ability to get a loan).
Housing problems are a huge concern in Charlotte, but there are new ideas popping up that will counteract those issues. Developers are focusing on sprawling rental properties in top areas.
The Queens Bridge Collective will cost about $800 million to complete, and the development has 45 stories and 400 residential units. There will also be 12,000 square feet for amenities and restaurants.
Though that's not the only one, you can see where this is going. If you can become a backer in one of these developments, it can be quite lucrative. However, these projects will take many years to complete, so you'll have to wait to recoup your money.
Will the Housing Market Crash in Charlotte?
The housing market isn't likely to crash anytime soon in Charlotte. In fact, the real estate market is booming. Everyone seems to want to move here, and that can be good for landlords and investors.
In fact, rent prices went up about 12 percent from last year, and the median rent for a one-bedroom apartment in North Carolina stood at $1,254 in March 2023. Charlotte is the most expensive city, so one-bedroom apartments are sitting at $1,570, though Hickory is an affordable option with rents being about $750.
If you choose the right neighborhood, you should gain a substantial rental income or be able to cover the mortgage payments with ease if you have decent tenants.
Charlotte Housing Market Statistics
According to Norada Real Estate Investments and other experts, here are the housing market statistics you should know:
- Charlotte has seen home values increase over 120 percent from 2014, and there's also been a stronger equity growth.
- Home sales are down slightly, and most buyers have a wide range of options. That could be good for investors!
- Charlotte home prices are sitting at $369,109. Overall, people are looking for more affordable housing, and rental properties could be the way to go.
- The thriving economy is doing great things, and the median household income is right at $65,000. Unemployment rates are low, and the monthly rent is generally around $1,751 for the Charlotte metro area.
- Charlotte, NC, is neck-and-neck with the national average for inventory, sitting at 2.6 months.
- There's a low cost of living in Charlotte, which is much less than the national average.
Housing Market Predictions
Though it's May, we haven't seen a rush for homebuying in the nation. In fact, it might be a dud altogether. Mortgage rates continue to increase, and existing and pending home sales took a dive in March. Likewise, median sale prices were lower for another month, so that could be a good sign for investors, though it's unlikely this will happen on a nationwide level.
Inventory continues to be a problem, and that puts prices higher. Affordability is a huge concern for first-time buyers, whether they want to live in the homes or rent them out. This is true in the nation and Charlotte and should continue that way for the near future.
Overall, those who already bought homes before 2023 saw lower interest rates than ever before. Now, things are changing, and prices are rising for mortgages and interest rates.
Charlotte Housing Market Predictions
There are almost one million people living in Charlotte, so there should be a decent mix of renters and buyers. Most experts feel that it's balanced right now, though there's a high demand for housing, and people are flocking to the city because of the job market.
Real estate developers are accommodating that high demand with rental properties. They're building options that cater to various industries and professionals, and most of them are mixed-use. Therefore, you have retail and office space along with upscale living.
Overall, there are positive signs for real estate investors. Zillow shows that average home values in the area of Gastonia, Concord, and Charlotte are $365,067, which is a 2.7 percent increase from last year. The upward trend should continue.
Charlotte's real estate market is also highly competitive, and the sale-to-list ratio is at 0.988. Therefore, homes sell close to the listing price. That could be a slight bummer for investors, as they want to get houses cheap to start earning a passive income quickly.
Still, 59.4 percent of all sales in the Charlotte real estate market happen under the list price, so there's room for negotiation.
There's plenty of activity, and this should continue for the foreseeable future. Since Charlotte is one of the fastest-growing cities, it's possible to get under contract quickly.
The real estate market is very promising right now, and it should remain balanced and see price appreciation for sellers. Therefore, investors should monitor the market conditions closely to adapt their strategies.
Charlotte is growing in popularity, and the economy is doing wonders for the real estate market. Overall, the city should continue attracting new residents and businesses, so the demand for rentals will increase, which is creating opportunities for most investors.
Overall, the housing supply for Charlotte sat at about 2.5 months in February 2023. The increase might not help much, but it's a good sign. Generally, experts feel that a six-month supply is crucial to balance the market and meet the buyer's demands.
Though there's been a lack of housing options in Mecklenburg County and Charlotte especially, developers are coming up with new ideas to correct the problem. This is great news for investors who don't mind putting in illiquid cash for the promise of high returns later.
If your goal is to buy homes and rent them to others, it's worth noting that this might be the right time to do it. Will you get into the best neighborhoods? That depends; however, home construction numbers are rising, and there are deals to be found if you know where to look.
Is the Housing Market in Charlotte Hot?
Homes tend to stay on the market for longer periods now than they did in 2022, and inventory is a huge concern. Still, people are buying homes, which could be good news for investors.
Should I Buy a Rental Property in Charlotte?
Home values are down from last summer because of affordability concerns and high mortgage and interest rates. Therefore, it could be a great time to invest in properties.