A recently published forecast for the Charlotte, North Carolina housing market indicates that home prices could rise more slowly over the coming months than they did over the past year. But competition among buyers remains high due to limited inventory.
Updated Forecast for the Charlotte Real Estate Market
In July 2018 the real estate research team at Zillow predicted that the median home value for Charlotte, North Carolina would rise by 3.2% over the next 12 months. This followed an actual recorded gain of 12.5% over the previous 12 months.
So clearly they expect price growth to slow down through the end of 2018 and into 2019. In this way, Charlotte mirrors many other cities across the country. The general consensus appears to be that price growth will slow down through the second half of 2018 and into 2019, in most cities across the U.S.
As of June 2018, the median sales price for Charlotte was $243,250, based on data provided by Trulia. The local Realtor association reported similar numbers for June 2018, which also indicated a rising trend. According to the Charlotte Regional Realtor® Association, the median sales price rose 2.8% in June compared to the same month a year earlier, landing at $248,045. This is based on data from the Carolina Multiple Listing Service.
Zillow’s economists also labeled the Charlotte housing market as “very hot,” which means there is a lot of competition among buyers. The current supply-and-demand situation within the local real estate scene makes it more of a seller’s market.
Limited Inventory Driving Competition Among Buyers
So the forecast for Charlotte’s housing market calls for continued home-price gains for the foreseeable future. And inventory has a lot to do with these predictions.
Among the major cities in North Carolina, Charlotte is one of the tightest real estate markets in terms of for-sale inventory. In May 2018, the city had about a 2.2-month supply of homes for sale. In theory, this means it would take 2.2 months to sell off all homes currently for sale if no new inventory came onto the market.
A balanced real estate market has somewhere between 4 to 6 months of supply. So the real estate scene in Charlotte still favors sellers or buyers.
In these constrained inventory conditions, sellers tend to have more market leverage. Buyers, on the other hand, often have to compete fiercely for limited inventory. And all of this puts upward pressure on home prices, which is why the median home value has climbed so much over the last year.
Strong Job Market Boosting Demand for Homes
According to the U.S. Department of Labor, the unemployment rate in Charlotte sank to 3.4% in May 2018. That indicates a strong local job market and a robust economy. The city’s unemployment rate is slightly lower than the statewide average for North Carolina.
A strong job market affects the housing market in Charlotte in a couple of ways:
- First of all, it attracts new residents who are seeking employment. This contributes to population growth, which in turn can boost demand for housing in both the rental and purchase side.
- A good job market also puts more people into a position where they can afford to buy a home. After all, employment is one of the first things mortgage lenders look at when reviewing loan applications.
Given the current supply and demand situation in the area, it’s not surprising to see a housing market forecast that calls for additional price gains. But homeowners probably shouldn’t expect to see double-digit gains in 2019, as they did over the last year or so. Price growth in this real estate market is predicted to slow down over the coming months.
Disclaimer: This report includes predictions and forecasts relating to the Charlotte, North Carolina real estate market in 2018 and 2019. These forward-looking statements were offered by third parties not associated with our company. The Home Buying Institute makes no claims or assertions regarding future economic and housing trends.