What is the real estate world supposed to do looking forward to 2019 in the Charlotte region? (The Charlotte region includes 12 counties in NC and 4 counties in SC which can be seen below here.) What are we supposed to do in this real estate market? Do we buy, sell, or wait? If you’re looking for a good place to put your money or if you are just looking to buy a home, you should consider that Charlotte is a solid real estate market. North Carolina has seen healthy growth in 2018 which should set a great tone for 2019.
Charlotte Region Counties
- Alexander
- Anson
- Cabarrus
- Catawba
- Cleveland
- Gaston
More NC Counties
- Iredell
- Lincoln
- Mecklenburg
- Rowan
- Stanly
- Union
South Carolina Counties
- Chester
- Chesterfield
- Lancaster
- York counties
2018 Charlotte Region Market Recap
In 2018 most of the real estate market was dominated by the sellers. Even though the prices have appreciated steadily year after year from the results of the 2008 crisis, the demand for housing remained strong which has kept sellers in control. Buyers felt this in 2018, often competing against several other offers to attempt to get a home. However, as we saw 2018 draw to a close we also saw interest rates heighten. These climbing interest rates began to shake the confidence of sellers and we saw a strong seller dominated market lose just a bit of its power.
2018 Overview
- New Listings Dropped 4.4%
- Closed Sales Dropped 14%
- Listing Days On Market Dropped 3.3%
- Average List Price Increased 4.9%
- Average Sales Price Increased 1.1%
- Average Lease Price Increased 2.8%
- Distressed Properties Made 1.2% Of The Market
- Fed Started Increasing Interest Rates
What Will Happen In 2019
My expectation is that the Charlotte Region will see a very healthy and more balanced market in 2019 in three ways. Between the healthy growth in the 2018 market, the projection of balance of power within the market, and the appealing price range Charlotte boasts, 2019 should be a strong year for Charlotte real estate.
First, regarding the healthy growth, in 2018 the Charlotte region saw a 5.8% growth. This is a healthy amount of growth between 5% and 10% which market analyst like our friends over at the Local Market Monitor like to see. The Charlotte region is just inside that.
Second, the balance of power withing the market is starting to shift. Real estate agents saw this toward the end of 2018 when the fed started playing with the interest rates, causing seller confidence to decrease. This has been helpful for Charlotte home buyers because they are starting to be able to demand more than before. Even though multiple offers will likely continue, we will see more true margins which will result in better options for home buyers.
Third, Charlotte offers big city living at an appealing price range. Considering other cities in the US, the Charlotte region is still one of the cheapest areas to live in in the US. Many of the larger cities in the US are able to sell in their current market and obtain similar sized housing in Charlotte at more than half of the cost. As if that isn’t great enough, let’s talk appealing prices within the Charlotte region for a minute. If the average sales price of $282,894 for the Charlotte region is not a statement validating the cost, look at what the averages include. Run your finger or cursor over these live charts to check out the averages here. (If you do not see the charts, you may need to allow your browser to run additional scripts which come from the NAR)
So these charts show the average prices of all 16 counties in the Charlotte region. It is pretty clear that you can find a house in surrounding counties for much cheaper than the average price for the region. In fact, most all of the counties in this region connect with Mecklenburg (the anchor county) in under an hour. Mostly less though. This is significantly less than many cities that require more time than that sitting in traffic.
So considering these three factors, even if there is a decrease in market growth for some reason this year, it should cause a relatively small impact for the Charlotte region. 2019 is looking good for the Charlotte market.
Is It Safe To Buy And Invest In The Charlotte Region In 2019?
Pending some catastrophe (specifically in the banking industry), it seems the market will be safe for the next year. I would proceed with attaining real estate in two different ways for home buyers and home investors.
First, for Charlotte home buyers, I would compare what you would pay in rent over a five year term. For 2018 the average monthly lease price is $1511, which is a 2.8% higher than $1470 in 2017. If you may be planning on staying in the area for the next 4-5 years then consider what you would get in a mortgage for even less. At 5% interest you can see relatively similar numbers on a $200,000 house.
This changes with many variables but, as a defensive strategy, imagine you bought a house which you lived in for 4-5 years and you sold at a total loss of $15,000. After one year of renting, you would still be at a greater loss. Not to mention a $72,528 loss from renting after four years alone.
Offensively, after one year, you should have a house that is worth more based on market appreciation alone. If it turns out to be a better year than expected, your bet for the housing market should reward you. Regardless, keep your price under the average sales price to insulate you from any potential downturn.
Second, for investors, I would focus on houses with a lower average than Mecklenburg county. Right now that is a fairly easy thing to do if you are buying on market homes with the intention of renting. Unless you are an investor that can find great off market prospects, I would defensively hold for the high rents. Focus on the properties that are close to colleges, hospitals, retail centers, and any other magnets that would attract renters.
Offensively, If you can find those homes that are off market, fix them up, and sell them on market (or the MLS) to see your best return. I would focus on lower than average priced homes close to your magnets or within about 20 minutes to Mecklenburg County.
Wrap Up
Lastly, consider this again, compared to many other cities, Charlotte is still one of the cheapest places to live especially when you compare it to the most expensive cities to live in around the US. I believe we will start to see a larger exodus from these more expensive places to Charlotte in 2019 because, as of last year, the Charlotte Area ranked 19th out of the fastest growing cities in America. This leads me to believe that unless the banking world completely falls apart, we should see a relatively stable market in 2019. Even in spite of what the fed is doing with interest rates.
I’m the owner of Stalwart & Wise Real Estate Group- Charlotte’s Best 😉 Residential Real Estate Agency- our small team has expertise in Buying (First time+ Repeat), Selling, REO (Foreclosures), Probate, and Divorce Situations. Our boutique real estate firm is committed to transparency throughout the whole real estate process as we give the best customer service. Local real estate expertise comes with a concierge style service that meets you where you are. Contact us for your real estate needs.