If you are looking at buying an investment property in the Charlotte real estate market, you’ll find all the housing statistics on this page to help you make a sound decision. 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 the 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.
The homebuyers in the Charlotte area have dealt with a persistent seller’s market, which has shrunk inventory and driven up home prices. Last year was the fifth consecutive year of home price gains in the Charlotte real estate market. However, record-low unemployment and low-interest rates have led the buyers to still find a home in this region. 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%.
So, how did COVID-19 affect the Charlotte housing market? It mainly affected the no. of new listings and closes sales which dropped in the month of 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.
Note: The Charlotte Metropolitan Statistical Area includes Cabarrus, Gaston, Iredell, Lincoln Mecklenburg, Rowan and Union Counties in North Carolina and Chester, Lancaster and York Counties in South Carolina.
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. It is better to avoid the price decline phase that will accompany the coming correction. Real estate prices are deeply cyclical and much of it is dependent on factors you can’t control.
Please note that many variables can potentially impact the value of a home in Charlotte (or any other market) and some of these variables are impossible to predict in advance. In this article, our focus will be on the current state of the Charlotte real estate market and how it can affect the investors and home buyers.
More details of the latest housing market trends within the limits of the city of Charlotte are given below.
Charlotte Housing Market Trends & Statistics 2020
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. We shall mainly discuss median home prices, inventory, economy, growth, and neighborhoods, which will help you understand the way the local real estate market moves in this region.
Charlotte is a minimally walkable city in Mecklenburg County with a population of approximately 727,822 people. High demand and low inventory in the Charlotte housing market led to a significant price rise in 2019. In the past ten years, the annual real estate appreciation rate has amounted to 3.95% in Charlotte, according to NeighborhoodScout.com. This puts Charlotte in the top 20% nationally for real estate appreciation.
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.
On average, homes in Charlotte sell after 35 days on the market. The trend for median days on the market in Charlotte has gone slightly down 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 1.5 months of supply – Signs of a seller’s real estate market.
The following analysis of the Charlotte housing market has been prepared by the “CANOPY REALTOR® ASSOCIATION.” The report compares key housing metrics of the “city of Charlotte” from April 2020 with April 2019.
The median sales price in April 2020 was $290,380, +11.7% year-over-year change.
The average asking price in April 2020 was $364,491, – 5.0% year-over-year change.
1,087 homes were sold in Charlotte in April 2020 as compared to 1,520 in April 2019, which is a decrease of 28.5%.
The year to date (Jan 2020 – April 2020) sales recorded were 4,664, +1.6% year-over-year change.
Inventory of homes for sale in Charlotte in April 2020 was 2,027, -24.7% year-over-year change.
Months Supply of Inventory in April equated to 1.5.
Asking to the Sales Price ratio was 85.
New listings in April 2020 were 1,293, – 33.4% year-over-year change.
Here is the chart to give you a visual of how the Charlotte housing market was trending for April 2020.
Snapshot Courtesy of CANOPY REALTOR® ASSOCIATION
These numbers can be positive or negative depending on which side of the fence you are — Buyer or Seller? As you can see, the Charlotte housing market isn’t yet showing the effects of the slowdown. Next month’s report will more clearly reflect COVID-19’s impact. While many have lost jobs, making them ineligible for a home mortgage, some sellers have taken their homes off the market. The decrease of 33.4% in the number of new listings indicates that new sellers are not willing to put their homes on the market until the pandemic is over or at least until the restriction orders imposed by the local government are revoked. Although the inventory is tight, the pandemic may favor the buyers in the bidding wars, which means prices won’t rise as is expected in a seller’s real estate market.
Charlotte Real Estate Market Forecast 2020 – 2021
What are the Charlotte real estate market predictions for 2020? Let us look at the price trends recorded by Zillow over the past few years. Charlotte has a record of being one of the best long term real estate investments in the U.S. Since 2015, the median home prices in Charlotte have appreciated by roughly 45.2% from $172,000 to $249,707, according to Zillow’s index.
The latest real estate data from Zillow shows that the current median home value in Charlotte is $252,438. Charlotte is currently a warm 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.
In the past year, Charlotte’s real estate has appreciated by 5.3%. The latest Charlotte real estate market forecast is that the home prices may remain flat or decrease by 1.2% – in the next twelve months. This is due to the short term impact of the ongoing pandemic which has impeded the real estate sales activity in the entire nation. In the long term, the Charlotte real estate market remains strong to favor sellers, due to persistent imbalance in the supply and demand.
Here is the visual representation of historical Charlotte home prices and the latest forecast until March 2021.
Snapshot Courtesy of Zillow.com
Here is a short and crisp Charlotte housing market forecast for the 3 years ending with the 3rd Quarter of 2021. The accuracy of this forecast for Charlotte is 88% and it is predicting a positive trend. LittleBigHomes.com estimates 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 – Charlotte, NC Homes For Sale
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. The median house price in Charlotte is $233,118, which indicates that home prices in Charlotte are near the national average for all cities and towns in the United States.
Charlotte’s single-family homes account for more than 50% of the city’s housing units. At the national level, the single-family rental homes have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single-family rental units. With 2020 being, theoretically, in the middle of a boom, there are still 4 years for residential construction to surge. Most likely, a housing shortage will remain in 2020, keeping home prices high.
Currently, there are 1662 homes for sale in Charlotte on Zillow, an online real estate database company. Additionally, there are 642 homes for rent. Under potential listings, there are about 7 Foreclosed and 202 Pre-Foreclosure homes. These are the delinquent properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
The median list price per square foot in Charlotte is $153, which is higher than the Charlotte-Concord-Gastonia Metro average of $136. The median price of current listings in Charlotte is $292,000 and the median price of homes that have been sold is $261,900. The median rent price in Charlotte is $1,500, which is higher than the Charlotte-Concord-Gastonia Metro median of $1,495.
There are currently 4028 homes for sale and 2094 homes for rent in Charlotte on Realtor.com, a real estate listings website. According to their statistics, in April 2020, the Charlotte housing market was a seller’s real estate market, which means there were roughly more buyers than there were active homes for sale. The demand for housing outpaced the supply. The median list price of homes in Charlotte, NC was $310K in April 2020, trending down -4.6% year-over-year. The median listing price per square foot was $157. The median sale price was $287.2K.
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. On average, they could sell homes for 100% of the asking price. A seller would always prefer scenarios that can yield a ratio of 100% or higher.
Graph Courtesy of Realtor.com®
Charlotte Real Estate Foreclosure Statistics 2020
As per the Charlotte foreclosure data by Zillow, 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%.
There are currently 892 properties in Charlotte, NC that are in some stage of foreclosure (default, auction, or bank-owned) while the number of homes listed for sale on RealtyTrac is 2,310. In April 2020, 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.
Potential Foreclosures in Charlotte
892 (RealtyTrac)
Homes for Sale in Charlotte
2310
Recently Sold
8692
Median List Price
$280,000 (6% drop vs Mar 2019)
In Charlotte, the zip code with the highest foreclosure rate is 28216, where 1 in every 3546 housing units is foreclosed. 28217 zip code has the lowest foreclosure rate, where 1 in every 11298 housing units becomes delinquent.
Here is the graph showing the number of new foreclosure filings in Charlotte by foreclosure type.
Charlotte Real Estate Market: Is It A Good Place For Investment?
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 the real estate investors and buyers in 2020.
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.
1. 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%.
2. Charlotte Real Estate is Relatively Affordable for Investors
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 apiece. This makes the Charlotte real estate market a particularly good value for real estate investors.
3. Charlotte’s Demographic Momentum
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 in the suburbs. The fact that the city is a top destination for Millennials guarantees long-term growth for the Charlotte real estate market.
4. Charlotte’s Quality of Life
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 than 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.
5. 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.
6. 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.
7. Low Property Taxes in Charlotte
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.
8. 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.
9. 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 Investment Properties: Real Estate Investment
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 the Charlotte real estate, you could secure your future.
The three most important factors when buying a 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.
The asking price of single-family homes in Charlotte (on Realtor.com) can start from $68,000 and can go up to $7M for a luxury property located in Eastside neighborhood. Eastside is an expensive neighborhood in Charlotte with a median price of $235,000. Myers Park has a median listing price of $1.2M, making it the most expensive neighborhood in Charlotte. Coulwood West is the most affordable neighborhood, with a median listing price of $222,500.
Here is a snapshot that shows the median home values in some of the popular neighborhoods in or around Charlotte.
Courtesy: Zillow
As with any real estate purchase, act wisely. Evaluate the specifics of the Charlotte housing market at the time you intend to purchase. Hiring a local property management company can help in finding tenants for your investment property in Charlotte. If it is your first time to invest in Charlotte real estate, then you would have to be aware of common beginner’s mistakes. Beginners would usually follow the media, buy a property, and wait for its value to increase. This could be risky. Real estate investing requires research. We recommend doing your own research or hiring a real estate investment specialist for guidance.
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.
Charlotte & North Carolina Real Estate Investments
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, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
References:
Latest Market Trends and Statistics
https://www.zillow.com/Charlotte-nc/home-values
https://www.carolinahome.com/market-data/monthly-reports
http://marketstatsreports.showingtime.com/CRRA_kcohd/sst/202004/Charlotte-MSA.pdf
https://www.neighborhoodscout.com/nc/charlotte/real-estate
https://www.littlebighomes.com/real-estate-charlotte.html
https://www.realtor.com/realestateandhomes-search/Charlotte_NC/overview
Foreclosures
https://www.realtytrac.com/statsandtrends/foreclosuretrends/nc/mecklenburg-county/charlotte/
Demographics
https://en.wikipedia.org/wiki/Charlotte,_North_Carolina
http://www.city-data.com/city/Charlotte-North-Carolina.html
Mobile homes
http://www.statemaster.com/graph/hou_per_of_hou_uni_tha_are_mob_hom-housing-percent-units-mobile-homes
https://www.reonomy.com/blog/post/how-to-invest-in-mobile-home-parks
Quality of life
https://realestate.usnews.com/places/north-carolina/charlotte
Landlord friendliness
https://www.avail.co/education/laws/north-carolina-landlord-tenant-law
Here’s how North Carolina’s new eviction-fee law changes things for landlords and tenants
Property taxes
https://wallethub.com/edu/states-with-the-highest-and-lowest-property-taxes/11585/
University
https://www.collegesimply.com/colleges-near/north-carolina/charlotte/
Redevelopment
http://charlottenc.gov/ED/Development/Pages/Corridor.aspx
https://www.bizjournals.com/charlotte/news/2017/02/17/developments-planned-for-north-end-neighborhoods.html
https://nextcity.org/features/view/charlotte-moves-toward-a-car-free-city-center
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