GROWTH DRIVES DEMAND; AFFORDABLE HOUSING IS SCARCE
Roughly 134 people moved to the Charlotte metro each day from 2022 to 2023. This growth inevitably creates a need for homes, and people with low to moderate incomes are struggling to find and buy homes.
Growth: 2014 to 2023
• Overall Charlotte metro growth: 471,750+ people
• Growth in households: 243,650+
House prices have increased very quickly in Charlotte in recent years. While the market has cooled since COVID-19, there are no signs for significant price declines in the near future. The slowdown in construction during the last two years, and a recent easing in the federal monetary policy, could place significant upward pressure on house prices.
The State of Housing in Charlotte 2024 Report, published by the UNC Charlotte Childress Klein Center for Real Estate in the Belk College of Business, takes a research-informed look at these and other issues related to housing. In its sixth year, the report and the State of Housing in Charlotte Summit offer trusted data-driven insights for anyone concerned about housing and its influence on the economic vitality of the Charlotte region.
Dr. Yongqiang Chu, lead researcher and author of the State of Housing in Charlotte Report, conducts research in real estate, corporate finance and banking. His research is published in top finance, real estate and economics journals. He also provides insights for Charlotte area leaders and community members through news media interviews, community talks and customized briefings.
CHILDRESS KLEIN CENTER FOR REAL ESTATE FACULTY
Dr. Yongqiang Chu
Director, the Childress Klein Center for Real Estate, Childress Klein Distinguished Professor of Real Estate and Urban Economics
Dr. Chandler Lutz
Associate Professor, Steven Ott Distinguished Scholar in Real Estate
Dr. Patrick Smith
Associate Professor, John Crosland, Sr. Distinguished Scholar in Real Estate and Development
Dr. Kiplan Womack
Associate Professor of Real Estate
Daniel Wright
M.S. in Real Estate Program Director, Senior Lecturer, Center Assistant Director
SUMMARY OF FINDINGS
Before 2011, it was reasonable for a household transitioning to first-time homeownership to assume it would be possible to find a home priced under $150,000 — the typical starter home price.
Now in 2024, just over a decade later, starter homes are those priced at $375,000 or higher. A dramatic decrease in the supply of less expensive houses raises serious concerns about the affordability of housing and the ability of people to move to owner-occupied housing.
The commonly used criteria for affordable housing says the total of costs related to housing, including utilities, should be less than 30% of a household’s total gross income. Considering current income distribution in the Charlotte region, about half of households could not afford a house priced at the lowest 10th percentile. About three out of four households could not afford a median-priced house.
Between 2020 and 2023, the minimum income needed to afford a home in the 10th percentile increased 84%. The income to buy a home in the 25th percentile increased 88%, and to buy a median priced home increased 93%. These trends were slightly reversed by the recent decline in mortgage interest rates, but could change again with lower mortgage rates.
Rates and Rents
Interest rates have come down in recent months, while the supply of housing has improved and even led to a small surplus. Yet, challenges persist. High interest rates from the past two years may drag down future supply, complicating the outlook for homebuyers. This is particularly possible in the years 2025 to 2027.
With condos and townhouses, the news is more upbeat. In September 2024, the median price of these other types of owner-occupied houses was $350,000, while the median price of single-family houses was $429,945.
Meanwhile, the situation for apartment dwellers has improved, with the supply catching up and rent going down slightly. From a longer view, between 2000 and 2024, supply has shown an increase of 147.4%. About 73% of all apartment units in the region are in Mecklenburg County.
Approximately 35% of the total rent growth from 2010 to 2024 occurred during the past 5 years alone. The rapid increases seem to have abated a bit, as effective rents have decreased since the peak of 2022. However, in the Charlotte metro, nearly half of all renters are cost-burdened, meaning they are spending more than 30% of their gross income on housing costs.
Finding 1
House price growth has stablized at a lower rate than during the COVID-19 pandemic, yet house prices are still growing.
Median Single-Family House Prices
$429,945 (September 2024)
$414,360 (September 2023)
$376,000 (January 2022)
Finding 2
The supply side is catching up. The Charlotte MSA had a surplus of 5,000 housing units in 2023 — yet shortages could still occur.
Finding 3
The housing market remains tight. Houses sit on the market for fewer than 20 days.
Finding 4
Affordable housing is extremely difficult to find.
Finding 5
Housing affordability is slightly better than last year because of lowered interest rates. A family income of just over $138,000 is needed to buy a median-priced house in 2024.
Finding 6
Apartment rents have decreased in 2023 and 2024, in large part because of the significant increase in multifamily apartments. +14.3% increase
THE CHILDRESS KLEIN CENTER FOR REAL ESTATE
The Childress Klein Center for Real Estate at UNC Charlotte was established two decades ago in 2005 with support from the real estate industry and program alumni. The center’s mission is to advance knowledge in real estate, public policy and urban economics, particularly through graduate education, innovative applied research, and industry and community collaboration. It ranks among the most active research institutions in real estate.
State of Housing in Charlotte Report Starts the Conversation
The annual State of Housing in Charlotte report, first released in 2019, is part of a multi-year project led by Belk College of Business faculty that serves as a critical piece of research and starting point for discussion regarding housing policy in the Charlotte region. The report considers owner-occupied, rental and subsidized housing in an eight-county area of Mecklenburg, Cabarrus, Gaston, Iredell, Lincoln and Union counties in North Carolina and Lancaster and York counties in South Carolina.
The Belk College of Business and the Childress Klein Center for Real Estate gratefully acknowledge our resource and data partners. The project would not have been possible without the substantial donation of data from the Canopy Realtor® Association Multiple Listing Service.
PLATINUM SPONSORS
SILVER SPONSOR
FRIENDS
Hopper Communities
Marcie Williams
DATA SOURCES
The Canopy Realtor® Association Multiple Listing Service
U.S. Department of Housing and Urban Development
U.S. Census Bureau
U.S. Federal Reserve Zonda CoStar