Thursday, July 6, 2017 / by Marketing Team
Why Charlotte Isn't in a Housing Bubble
Across the U.S., the demand for more housing options has been prevalent in the most sought-after cities, with Charlotte, NC being one of them because of its location in the Southeast being such an affordable region in which to live. Despite the speculation in the real market with low inventory and high demand for homes, Charlotte is not experiencing a housing bubble.
Here are 3 reasons why potential homebuyers can remain confident in what Charlotte real estate has to offer:
1. Standards for obtaining a mortgage have since changed from what they were in 2007.
Back when the nation-wide housing bubble existed, lenders’ standards were much too lenient in who they allowed to obtain mortgages. There were people who were not qualified to purchase a home but were given the ability to anyway.
As a result, prices soared, as did the demand, and markets tended to overproduce so that two problems quickly escalated: foreclosures and stagnant home sales. It was only a matter of time before the bubble burst.
2. New construction remains in-balance.
The supply for existing home sales in Charlotte as well as new home construction remains at roughly a 2 month inventory, with high occupancy rates that are expected to hold steady.
Additionally, new construction totals in the U.S. are not only significantly lower than what they were during the years leading up to the recession (which were 350,000 from 2003-2006), but at 142,800 now, they are also even lower than what they were in the early 1980’s, which was at 174,000.
3. Home prices haven’t spiked.
While it’s true that many housing markets in high-cost cities are less affordable for homebuyers, it also means that prices haven’t been as high as what they were back in 2007. As Trulia reports, housing recovery remains a work in progress.
Property values haven’t reached a peak, and are only considered to have recovered if they surpass what they were before the recession hit. Only 34.2% of homes in the country have recovered so far at a 5-6% growth rate per year since 2012. Of those that have recovered, Denver, CO is at the top of the list at 98.7%, while Worcester, MA is only at 8.1%.
Charlotte, NC remains at 71%, with other major North Carolina cities of Greensboro-High Point at 44.1%, Raleigh at 87.6%, and Winston-Salem at 44.6%. The nation is only expected to catch up by 2025, which makes buying a home in Charlotte and in any other hot market a lucrative investment right now.
Charlotte Real Estate
If you are looking for an investment property, now is truly the time to buy a Charlotte home!
To get started today, contact the Showcase Realty team at 704-997-3794 or send us a message here to see the latest homes for sale in the area. We look forward to serving you!