Rent in Charlotte is still on the rise. A real estate broker explains why
The Charlotte market has been on a steady incline for years now. However, more recently, Charlotte natives and newcomers alike have noticed that their rent has reflected the rapid development of the city.
According to a report by Apartment List, an online marketplace for rental listings, Charlotte’s year-over-year rent increase of 17.2% exceeds the national average of 15.3%.
The average rent for a studio in Charlotte last month was priced at $1,607, while a one-bedroom stood at $1,617. The average for two bedrooms was $1,963 and the average 3-bedroom apartment was priced at $2,201, Apartment List reported.
Although the Charlotte rental market has softened recently, there’s no denying that the average rent is still comparatively high.
The driving force behind Charlotte’s rent rise
Matt Stone, a broker and managing partner at Matt Stone Real Estate in Charlotte, explains that the dramatic increase in rent over the past year is nothing out of the ordinary when compared to other cities.
“Rent in Charlotte has tracked similar percentage increases to other metros our size,” Stone told The Charlotte Observer.
However, despite the similarities, Charlotte’s housing stock has not been able to meet the demand brought on by the rapid growth the city has experienced over the last decade, Stone said.
“Available housing stock has not kept up with population growth since the 2008 crash,” Stone explained. “We believe that is the primary driver of the supply-demand imbalance.”
A product of rapid growth
According to most recent projections by the United States Census Bureau, Charlotte currently averages more than 2,400 people per square mile. Since 2010, the population in Charlotte has increased by more than 148,000 people.
Last year, the UNC Charlotte Urban Institute published a report that revealed low-cost rental options in the area were steadily decreasing. In 2011, 45% of the market was made up of rentals that were less than $800 per month. In 2019, that percentage had dropped to 22%.
“Meanwhile, the demand for affordable housing has not decreased,” the report states. “The population of Mecklenburg County increased by 20% between 2010 and 2019. As a result, households are forced to ‘rent up,’ spending more on housing costs than is considered affordable.”
According to the report, if a household’s monthly housing costs exceed 30% of its monthly gross income, the renter is considered “cost-burdened.” Most recent data shows that in 2019, more than 83,000 renters in Mecklenburg County, or approximately 44%, were in that category.
