Why is the Charlotte housing market so high right now?
While the tar heel state is home to the hustle and bustle of the south with its booming banking industry and the steadiness of its many metropolitan areas, Charlotte, like most major cities, has recently seen an explosion of growth.
Last month we wrote an article about the Charlotte, NC, housing market trends; today, we will talk about the rising cost of living in the Charlotte housing market.
Why is the Charlotte housing market so high right now?
Charlotte real estate is actually slightly higher in 2023 compared to 2022, with the median home price in Charlotte just over $369,000. You might wonder why this is the case even with soaring interest rates.
The simple answer is supply and demand.
There is a low housing inventory with high demand for the incredible Charlotte, NC, housing market. Home prices have steadily increased to mitigate this trend, leading to overvaluation, making Charlotte neighborhoods more exclusive. While popularity and development continue to create more housing options for the future, competition is at an all-time high among potential homeowners.
For more historical context, despite the rapid urbanization of Charlotte’s metro area, its housing market never fully recovered since the housing market crash in 2008 due to developers going out of business, leaving many with fewer and fewer options to live. Since the pandemic, demand has steadily increased, causing a supply shortage of homes. Recent trends have reversed that in the concise term, but not to the point of taking precedence.
Understanding Charlotte’s real estate market
In early 2023, a news article ranked the Charlotte housing market as one of the Top 5 most overvalued in the country, up from number 11 the year prior. This should not be surprising as several metro areas in NC, including but not limited to Durham, etc., that exhibit overvalued markets. Mecklenburg County, home to the “Queen City” itself, had an average home price of $439K in July 2023, increasing by 5.8% compared to July 2022.
While major cities like San Francisco, D.C., among others, have a substantially higher home price average, we can see that homes are being sold nearly congruent to their value. However, home prices in Charlotte have exceeded property value for many reasons, like supply and demand and competition, among other factors.
New to Charlotte, NC? Here are some fun things to do:
- Visit the Whitewater Center for adventures!
- Go to a Carolina Panthers football game
- Check out the local wineries!
Is the Charlotte housing market still a good market to invest in?
All investments assume risk, but Charlotte’s housing market is still a wise investment!
As Charlotte is the banking capital of the south and growing in popularity, new businesses and residents have been flocking there to set up shop and live. As this trend continues to persist, the demand for rental properties will rise, which serve as an incentive for investors. Incentives are the main drivers of any real estate transaction!
What does Charlotte’s housing market forecast look like in the future?
Charlotte’s housing market forecast looks pretty darn good! We can determine that this city’s real estate market is stable the is conducive to growth and is expected to grow 8.2% year over year in 2024, according to Norada real estate investments, without major fluctuations.
>> See more about Charlotte’s Real Estate Market trends.
When will housing prices in the Charlotte real estate market go down?
Yes, we can see a slow, negligible trend downward of property values in the Charlotte area for the foreseeable future. According to the Canopy Realtor Association, the average home price was $388K per the National Association of Realtors in May 2023, dropping 2% from May 2022 and are likely to continue. Furthermore, as of this year, home listings have decreased in the Charlotte area because homes are taking a lot longer to sell, creating buyer demand (higher supply of homes, fewer buyers) with fewer closed sales.
However, generally low-interest rates on mortgages (by federal reserve), competitive bidding, and Charlotte developers creating opportunities for potential home buyers have made the Charlotte housing market as a whole a balanced market for all despite current short-term conditions.
What’s the verdict?
Charlotte is one of the fastest-growing cities in the US, and demand has been through the roof (despite a recent lull), but home prices haven’t been that friendly.
Supply and demand of local real estate have new listings flying off the charts due to heavy competition for new homeowners. It helps that the area is a lovely place to be, and it indeed is; you might have to navigate home prices strategically.
Whether you’re moving to the Charlotte region for family or a job, ensure you have a high income! Rest assured; you’ll find the right home for you through making informed decisions and counseling with a local realtor!
Are you a buyer or seller in the Charlotte area? Perhaps you are looking to relocate to city or the surrounding communities. When it comes to buying homes in Charlotte, you will need an expert real estate agent to help. See how Robin Hickman of Robin Hickman Realty has been helping buyers and sellers in Charlotte!
