The homebuyers in the Charlotte housing market have dealt with a persistent seller’s market, which has shrunk inventory and driven up home prices. Charlotte's real estate market continues to boom without being affected by the pandemic. Homes are selling quickly, inventory is low and prices are rising fast. Last year was the eighth consecutive year of home price gains. The supply of homes for sale in the Charlotte MSA has now dropped to its lowest level in 17 years. There's just a little more than two weeks of inventory left.
Continuing the Charlotte-area housing market's hot streak, home sales and the median price paid for those homes rise in February. Low mortgage interest rates, high demand, and a shortage of homes continue to fuel the Charlotte real estate market and drive prices higher.
So, how did COVID-19 affect the Charlotte housing market? Until March 2020 the real estate sales were going steady in the entire Charlotte Metropolitan Statistical Area. 3,630 homes were sold in March, which is a year-over-year increase of 4.9%. It mainly affected the no. of new listings and closes sales which dropped in April.
In April, the year-over-year sales in the Charlotte MSA dropped by a whopping 22.2% to 2,960. However, it hasn't yet impacted the home prices in Charlotte. Once again, as inventory has dropped, prices have risen. The median sales price in the Charlotte Metropolitan Statistical Area in April 2020 was $282,995, +9.7% year-over-year change.
Inventory of homes for sale in Charlotte MSA dropped by 24.8% to 6,066 as compared to last year. The months of supply of inventory in the entire metropolitan area equated to 1.7. Due to a long shutdown, there has been pent-up demand. Charlotte is seeing an influx of new residents from expensive cities in the North and West. There's an influx of buyers from California, Chicago, New York, New Jersey, and Connecticut. Here are the latest housing indicators for this region.
Charlotte Housing Market Trends 2021
Analyzing real estate data from multiple sources gives us a much broader perspective of the direction in which a market is moving. We shall now discuss some of the most recent housing trends in the Charlotte area from multiple sources and compare them with the past couple of years.
According to Realtor.com, Charlotte is a seller's real estate market, which means there are roughly more buyers than there were active homes for sale. The demand for housing outpaces the supply. In February 2021, the median list price of homes in Charlotte, NC was $325K, trending up 6.6% year-over-year. The median listing price per square foot was $180. The median sale price was $312K.
The sale-to-List Price Ratio was almost 100%. Ideally, a buyer would prefer a sale to ask price ratio that’s closer to 90%. The sellers in Charlotte have managed to hold good leverage in these negotiations in the past month. A seller would always prefer scenarios that can yield a ratio of 100% or higher.
The following analysis of the Charlotte housing market has been prepared by the “Canopy Realtor® Association.” The figures are for the ten-county Charlotte MSA which includes Cabarrus, Gaston, Iredell, Lincoln, Mecklenburg, Rowan, and Union Counties in North Carolina and Chester, Lancaster, and York Counties in South Carolina. The report compares key housing statistics of the Charlotte MSA from Feb 2021 to Feb 2020.
On average, homes in Charlotte sell after 30 days on the market. The trend for median days on the market in Charlotte has gone down by- 37.5% since last year. In a healthy, balanced market, it would take about six months for the supply to dwindle to zero.
In terms of months of supply, the Charlotte market can tip to favor buyers if the supply increases to more than six months of inventory. However, looking at the current trends, we don't see things stopping anytime soon. The current inventory of homes equates to 0.6 months of supply – A sign of a hot seller's real estate market.
The following report compares key housing metrics of the “City of Charlotte” from Feb 2021 to Feb 2020.
These numbers can be positive or negative depending on which side of the fence you are — Buyer or Seller? The increase in the number of new listings indicates that sellers are willing to put their homes on the market. You can expect to see more homes for sale in the peak buying season. Right now the inventory is tight which will pull the prices up in the coming months. As you can see the Charlotte real estate market isn't cooling off as yet.
Charlotte is a hot market for investors whether they want to renovate and flip, buy to hold and rent or invest in multi-family properties. Charlotte's real estate appreciation rate in the latest quarter was around 0.52% which equates to an annual appreciation rate of 2.10%. You can choose to market your home to potential buyers. Any homeowner looking to cash out and sell off their property should do it in the current phase. Real estate prices are deeply cyclical and much of it is dependent on factors you can’t control.
Charlotte Real Estate Market Forecast 2021-2022
What are the Charlotte real estate market predictions for 2021 & 2022? Charlotte is a minimally walkable city in Mecklenburg County with a population of approximately 727,822 people. Charlotte was ranked fourth-hottest U.S. housing market in 2018 as prices and rent kept going up. It was ranked in the top 10 in another forecast for 2018, coming in at No. 7 in a Realtor.com prediction. Like many fast-growing cities, the housing market in Charlotte has been defined by tight inventory, rising prices, and climbing rent.
Charlotte has a mixture of owner-occupied (53.09%) and renter-occupied (46.91% ) housing units. According to Neighborhoodscout.com, a real estate data provider, three and four-bedroom single-family detached are the most common housing units in Charlotte. Other types of housing that are prevalent in Charlotte include large apartment complexes, duplexes, rowhouses, and homes converted to apartments.
Charlotte has a record of being one of the best long-term real estate investments in the U.S. High demand and low inventory in the Charlotte housing market led to a significant price rise in 2019. Let us look at the price trends recorded by Zillow over the past few years. Since 2012, the median home prices in the city of Charlotte have appreciated by nearly 91% (Zillow Home Value Index).
Charlotte home values have gone up 11.9% over the past year and the current median home value is $287,022. Charlotte is currently a seller’s real estate market. The demand is exceeding the supply, giving sellers an advantage over buyers in price negotiations. In other words, there are fewer homes for sale than there are buyers in the marketplace.
If mortgage rates remain low, it will continue to bolster the home buying activity and pull the home prices up. For sellers, now is the opportune time to put their Charlotte home up for sale. The pricing of homes is trending higher and is more attractive for sellers in the current phase.
- Charlotte-Concord-Gastonia Metro home values have gone up 11.8% over the past year and Zillow predicts they will rise 15% in the next twelve months.
- Charlotte home values have gone up 11.9% over the past year and will continue to rise in the next twelve months due to the supply-demand imbalance.
- The typical home value of homes in North Carolina is $231,166 (middle price tier of homes). Home values have gone up 10.3% over the past year and will continue to rise in the next twelve months.
The chart below, created by Zillow, shows the growth of median home values since 2011 and their forecast until February 2022.
Here is a short and crisp Charlotte housing market forecast by LittleBigHomes.com for the 3 years ending with the 3rd Quarter of 2021. It also predicts a positive trend. They estimate that the probability of rising home prices in Charlotte is 88% during this period. If this price forecast is correct, the Charlotte home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.
Charlotte Real Estate Foreclosure Trends
As per the Charlotte foreclosure data by Zillow (not updated), in Charlotte 0.5 homes are foreclosed (per 10,000). This is lower than the Charlotte-Concord-Gastonia Metro value of 0.7 and also lower than the national value of 1.2. The percent of delinquent mortgages in Charlotte is 1.2%, which is higher than the national value of 1.1%. The percent of Charlotte homeowners underwater on their mortgage is 6.3%, which is higher than Charlotte-Concord-Gastonia Metro at 6.0%.
In April 2020, there were currently 892 properties in Charlotte, NC that were in some stage of foreclosure (default, auction, or bank-owned) while the number of homes listed for sale on RealtyTrac is 2,310. The number of properties that received a foreclosure filing in Charlotte, NC was 91% lower than the previous month and 90% lower than the same time last year.
New Foreclosure Filings for Charlotte, NC (on Realtytrac.com)
Due to the pandemic, there are moratoriums on single-family foreclosures and real estate-owned (REO) evictions until March 31, 2021, to keep delinquent homeowners in their homes. Here's the current distribution of foreclosures based on the number of active foreclosure homes in Charlotte, NC. These numbers show rising foreclosures.
|Foreclosure Type||Prior Month||Prior Year|
Currently, the zip code with the highest foreclosure rate is 28217, where 1 in every 3766 housing units is foreclosed. 28203 zip code has the lowest foreclosure rate, where 1 in every 8851 housing units becomes delinquent.
Charlotte Real Estate Investment 2021
Now that you know where Charlotte is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Is Charlotte a Good Place For Real Estate Investment? Many real estate investors have asked themselves if buying a property in Charlotte is a good investment? You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers in 2021.
When someone considers investing in real estate, attention tends to drift to the hot markets like San Francisco or the places those residents are fleeing to due to the high cost of real estate. In other cases, investors focus on the “cool” places people want to be and assume that will yield a good return on the investment.
We’ve taken the time to look for better long-term opportunities, and that brought us to the Charlotte housing market. Charlotte is the largest city in North Carolina. The city proper is home to more than 800,000 people. The Charlotte Metropolitan Statistical Area is even larger – home to roughly two and a half million people. It is one of the country’s fastest-growing metro areas, and it was the second fastest-growing city in the southeastern United States. Only Jacksonville, Florida was growing faster between 2004 and 2014.
If you are looking to make a profit, you don’t want to buy the most expensive property on the Charlotte real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Charlotte that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider. Let’s take a look at the number of positive things going on in the Charlotte real estate market which can help investors who are keen to buy an investment property in this city.
The Job Growth in Charlotte
Why do people move to an area? They may relocate because they want to retire there or they think it is safer. However, the general reason people move to – or away from – an area is economic opportunity. Charlotte's unemployment rate was 3.1% in Dec 2019 as compared to 3.8% in Dec 2018. The US average is 3.9%.
The area’s historically strong economy explains why roughly 100 people a day move into the area. And that propels the demand for the Charlotte real estate market. Between 2018 and 2019, Charlotte saw a 2.3 percent increase in jobs, adding more than 27,300 jobs year over year. Future job growth over the next ten years is predicted to be 45.2%, which is higher than the US average of 33.5%.
Impact of the Pandemic: Charlotte, NC Unemployment Rate is at 6.30%, compared to 6.30% last month and 3.80% last year. This is higher than the long-term average of 5.15% (Source Bureau of Labor Statistics). We can see a steady drop in Charlotte's Unemployment Rate from its peak in May 2020 (13.9%).
Charlotte Real Estate is Relatively Affordable
Home prices in Charlotte are somewhat more expensive than the rest of North Carolina but affordable when you look at national prices. Detached homes cost around $300,000, townhomes around $200,000. You can buy duplexes for roughly $400,000. Three and four-unit structures cost around $120,000 a piece. This makes the Charlotte real estate market a particularly good value for real estate investors. The current median price of homes is around $300K in Charlotte MSA and $309K in the City of Charlotte.
Demographic Momentum & Quality of Life
Charlotte has a median age of 34, several years younger than the national average. That is because many people are moving here for work. This means the Charlotte real estate market is going to see demand from both people moving here for work and young adults who stay and raise families here; young adults who come here for school and work will eventually move up in the Charlotte housing market, whether in the city or the suburbs. The fact that the city is a top destination for Millennials guarantees long-term growth for the Charlotte real estate market.
Charlotte, North Carolina ranks rather high in the U.S. News rankings of the best places to live. They were ranked 22nd in both on the list of best places to live and the best places to retire. Other places ranked higher on the desirability, sometimes due to a “coolness” factor that brings people to Austin, Texas. Charlotte’s good score was due to the availability of jobs, overall value, amenities, and safety of the community. That will attract people who may not be moving specifically for work and lead many who were raised here to stay.
This suggests the Charlotte real estate market is going to remain strong even if the local economy isn’t so hot in the future. The huge demand for homes in Charlotte provides uncommon stability in its housing market. There are also intangibles such as quality of life and strong southern comfort that can't be measured by metrics. Residing in the south usually equates to easy living, but few southern cities offer Charlotte's stable housing market.
Charlotte's Mobile Home Market
We’re not going to spend time gushing about the upper end of the Charlotte housing market. Instead, we’re going to address a market that is generally overlooked, the affordable options in the Charlotte real estate market. Per-capita income in Charlotte is around $33,209 and the Median household income of a Charlotte resident is $53,274 a year. The US average is $53,482 a year.
This prices many out of the housing market, since the median rent is roughly $1,500 a month. If you do the math, you’ll find that with an average household income of $53,482 and a median list price of $292,000, the Charlotte area sports a price-to-income ratio of 5.45. In other words, it’s just as unaffordable here as it is for those living in New York or Denver.
The solution for many is staying in a mobile home. Mobile homes cost around $40,000 a year, still out of reach for many would-be renters. The relatively mild climate of the Carolinas eliminates the problem of keeping mobile homes warm in the winter, as well. The Carolinas contain a large number of mobile homes, so they’re considered an acceptable alternative for many renters.
Nearly 20% of homes in South Carolina are mobile homes, and 17% of homes in North Carolina are. Yet there are relatively few people building mobile home parks, though they’re still regularly installed on private rural land. Given the incredibly high ROI of mobile home parks due to their low maintenance requirements, we couldn’t neglect this unique aspect of the Charlotte real estate market.
Charlotte's Landlord Friendliness
North Carolina is considered landlord-friendly. The state doesn’t have notice of entry laws. A written agreement is recommended by not mandated for leases that last less than a year. There’s a five-day grace period before you can assess late fees on rent. You don’t have to have a rental license to be a landlord. The state doesn’t have rent control or rent regulation. If they don’t pay the rent, you can begin eviction on the 11th day. If they violate the lease, especially for criminal offenses, there’s no need to give notice and the eviction process is expedited.
A new law makes Charlotte even more landlord-friendly. A law that passed in the summer of 2018 allows landlords to recover attorney’s fees and court costs from tenants when the eviction goes to court. Therefore, one of the reasons we recommend the Charlotte housing market is the fact that you won’t own a property where the tenants aren’t paying rent for months while you rack up insane legal bills.
Low Property Taxes
South Carolina has the sixth lowest property taxes in the U.S. North Carolina did worse at 22nd out of the 50 states, but that’s certainly better than neighboring Georgia; that state was literally average at 25th place. You would pay a little more than locals if you’re an out-of-state landowner. Factor in its cheaper than average real estate, though, and you’ll pay an average of $1300 a year in property taxes on a South Carolina property. Compare that to the median $2700 bill in Texas, $3300 you’d pay in Wisconsin, $4000 you’d be billed in Illinois, and the whopping $7600 bill for a home in New Jersey.
Charlotte's Big Student Market For Rental Properties
Being the largest city in the state guarantees there’s a sizable university in town. Charlotte boasts several of them. The University of North Carolina has a campus here, of course. Queens University of Charlotte, Davidson College, Johnson C. Smith University, and two dozen others are located in and around Charlotte, North Carolina. You could buy up apartment buildings in and around massive campuses or literally next door to smaller schools like Johnson and Wales University.
The Redevelopment in Charlotte Downtown
Charlotte is seeing a wave of the redevelopment of downtown. Properties along transit corridors are eligible for grants and special privileges. The city has targeted specific corridors for redevelopments like Rozzelles Ferry Road and Beatties Ford Road. North Charlotte, too, is slated for redevelopment. If you buy up properties in the vicinity and renovate them, you could either rent them out at higher rates in the future or sell them at a sizable profit. The interesting opportunity lies in the car-free city center that could result in rundown buildings becoming upscale properties. That project is called the North Tryon Vision Plan, and it covers a sixty-acre, 50 city block area.
Charlotte & North Carolina Real Estate Investment Markets
Maybe you have done a bit of real estate investing in Charlotte, North Carolina but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. One advantage of living in a big city like Charlotte is the constant demand for homes.
Buying a home in Charlotte is a better investment, depending upon several factors. There are so many major companies and professional sporting events that people will always be interested in residing here. Therefore, interested investors aren't likely to allow the listing prices to get too low before they swoop in and take advantage.
Good cash flow from Charlotte investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt. Therefore, finding a good Charlotte real estate investment opportunity would be key to your success. If you invest wisely in Charlotte real estate, you could secure your future.
The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Charlotte investment real estate and you should be able to flip it for a lump sum profit.
The neighborhoods in Charlotte must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. Some of the best neighborhoods in or around Charlotte, North Carolina are Ballantyne West, Highland Creek, Provincetowne, Myers Park, Beverly Woods, Cherry, Eastover, Barclay Downs, Elizabeth, Dilworth, Foxcroft, NoDa, Madison Park, Cotswold, Greenville, Sedgefield, South End, and Belmont.
Charlotte real estate appreciated 64.39% over the last ten years, which is an average annual home appreciation rate of 5.10%, putting Charlotte in the top 10% nationally for real estate appreciation. If you are a home buyer or real estate investor, Charlotte definitely has a track record of being one of the best long-term real estate investments in the nation through the last decade or so. As with any real estate purchase, act wisely. Evaluate the specifics of the Charlotte housing market at the time you intend to purchase.
|Highest Appreciating Charlotte Neighborhoods Since 2000 (By Neighborhoodscout.com)|
|S Kings Dr / S Independence Blvd|
|E 3rd St / S Mcdowell St|
|East Blvd / South Blvd|
|New Life Theological Seminary / N Davidson St|
|Grace St / Parson St|
|Eastway Dr / Arnold Dr|
|Central Ave / Saint Julian St|
|Hawthorne Ln / Belvedere Ave|
|The Plz / Shamrock Dr|
|West Blvd / S Tryon St|
NORADA REAL ESTATE INVESTMENTS has extensive experience investing in turnkey real estate and cash-flow properties. We strive to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in many other growth markets in the United States. We can help you succeed by minimizing risk and maximizing the profitability of your investment property in Charlotte.
Consult with one of the investment counselors who can help build you a custom portfolio of Charlotte turnkey properties. These are “Cash-Flow Rental Properties” located in some of the best neighborhoods of Charlotte.
All you have to do is fill up this form and schedule a consultation at your convenience. We’re standing by to help you take the guesswork out of real estate investing. By researching and structuring complete Charlotte turnkey real estate investments, we help you succeed by minimizing risk and maximizing profitability.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market areas, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing, and interest rates.
Apart from Charlotte, you can also invest in the Durham real estate market. There are many reasons to buy investment properties in Durham. An unusual combination of features makes Durham attractive to real estate investors since it creates a large population of renters willing and able to pay more per month to live here because they cannot necessarily find their dream home. Durham is going to see heavy population growth over the next decade. Another seventy thousand people are expected to contribute to the demand for properties in the Durham real estate market overall.
The second real estate market in the state of North Carolina lies in the city of Wilmington. The Wilmington real estate investment is stable, slowly growing, and not going to see a change in the demand for rental properties any time soon. Several factors contribute to rents being higher than you’d expect given the average wages and property values, increasing the ROI on Wilmington rental properties. Furthermore, there are several niches you can explore to achieve even higher returns, depending on the market you’d like to serve.
Asheville is another hot real estate market in the state of North Carolina. The Asheville area is a stable, steadily growing housing market with several profitable rental markets investors would appreciate. It counterbalances this with a healthy job market and demographic momentum that will keep it going strong for years to come.
Greensboro, NC is another good real estate market. Greensboro is the third-largest city in the state. The Greensboro real estate market offers an ideal situation for investors seeking steady, predictable returns. Return on investment is relatively high and not expected to decline, while the property itself is relatively cheap. The job market is strong enough to slowly attract residents and increase pay rates, but it won’t result in a massive influx of new construction to undermine existing property values. The area is large and diverse enough to give investors a choice of property types and markets to serve.
Let us know which real estate markets you consider best for real estate investing!
Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third-party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
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