MARKET SNAPSHOT
$1,592 3Q 2024
91.6% 3Q 2024
3,883 [YTD: 9,456]
-1.5% 3Q 2024
-80 BASIS POINTS
3,637 [YTD: 11,673]
Charlotte’s average occupancy rate has contracted slightly due to supply pressures, but the market is showing signs of stabilization, with six submarkets recording annual occupancy increases.
Over the past 12 months, over 15,000 units were delivered, more than one-third higher than the previous record and 30% above the pre-pandemic average of 7,400 annual deliveries.
Looking ahead, rent performance is expected to stabilize by mid-2025 as supply pressures ease, especially in the luxury segment.
While absorption rebounded strongly in 2024, it has yet to keep pace with the record level of new supply year-to-date. However, a positive sign emerged in the third quarter as net absorption slightly outpaced new deliveries. Of the 19 submarkets, all but Rowan County posted positive net absorption, with the University and South End submarkets leading the way, recording 710 and 677 net new units occupied, respectively, showcasing the market’s improving performance.
Charlotte’s supply pipeline is reaching record highs in 2024, both historically and compared to peer markets. Over the past 12 months, more than 15,000 units were delivered—over one-third higher than the previous record and about 30% above the market’s pre-pandemic average of 7,400 annual deliveries from 2015 to 2019. Although construction has peaked, an additional 26,000 units are currently underway, representing an 11.4% expansion of inventory.
Inventory increased by 6.5% over the past year, leading to an 80-basis-point drop in the average occupancy rate, now at 91.6%. However, signs of stabilization are emerging, with a smaller decline of just 20 basis points between Q2 and Q3 2024. Eleven of the 19 submarkets reported occupancy rates at or above the market average, with Lincoln County leading at over 96%. Even the South End submarket, despite a large influx of new deliveries, maintained a strong 93.7% occupancy rate. Economic momentum is expected to support the multifamily market, with construction starts returning to pre-pandemic levels, signaling a tapering of new deliveries by 2025.
A historic expansion of apartment inventory has cooled rent growth in Charlotte, with competition particularly strong among the market’s newest properties. As a result, the average rental rate has declined year-over-year for six consecutive quarters, including a 1.5% drop in Q3 2024. On a submarket level, the Lower South End, where average rents exceed $2,000 per month, was hit hardest, with an 8.1% year-over-year decline. In contrast, high-demand areas like Lancaster County saw an average rent increase of over 3.0% during the same period. Looking ahead, rent performance is expected to stabilize by mid-2025 as supply pressures ease, especially in the luxury segment.
In August 2024, the Charlotte, NC metro added 24,400 jobs, marking a 1.8% increase in employment compared to the previous year. This growth occurred despite the unemployment rate rising by 90 basis points to 4.3%, aligning closely with the national average of 4.2%. The Government sector led job creation, adding 8,000 new positions, reflecting a robust 4.9% growth, driven by increased public sector initiatives and expansions. The Leisure and Hospitality sector also showed significant gains, expanding by 4.5% with 7,000 additional jobs, bolstered by strong tourism and entertainment activity in the region.
August 2024 ANNUAL JOBS CREATED
AUGUST 2024 EMPLOYMENT GROWTH
AUGUST 2024 Unemployment rate
4.2% us August rate
Nominal Change
from August 2023
to August 2024: 8,000
Percent Change: 4.9%
Nominal Change
from August 2023
to August 2024: 7,000
Percent Change: 4.5%
Nominal Change
from August 2023
to August 2024: 5,300
Percent Change: 3.8%
Nominal Change
from August 2023
to August 2024: 2,700
Percent Change: 3.4%
Nominal Change
from August 2023
to August 2024: 1,800
Percent Change: 1.5%
| Sector | Nominal Change from August 2023 to August 2024 | Percent Change |
|---|---|---|
| Government | 8,000 | 4.9% |
| Leisure and Hospitality | 7,000 | 4.5% |
| Education and Health Services | 5,300 | 3.8% |
| Mining, Logging, and Construction | 2,700 | 3.4% |
| Financial Activities | 1,800 | 1.5% |
| Professional and Business Services | 1,400 | 0.6% |
| Other Services | 1,000 | 1.8% |
| Manufacturing | -100 | -0.1% |
| Information | -300 | -1.2% |
| Trade, Transportation, and Utilities | -2,500 | -0.9% |
The Innovation District will feature a medical school tower and a 330,000 SF research building.
Siemens Energy, one of the world’s leading energy technology companies, has selected Charlotte, NC for its first transformer manufacturing facility in the U.S.
German electrical engineering company, DEHN Inc., plans to invest $40 million to build its headquarters and a manufacturing facility in Iredell County, bringing 200 jobs in the process.
Charlotte’s market outlook remains highly optimistic, fueled by strong economic growth and significant investments across key sectors. The region is poised to benefit from major developments, including the $1.5 billion Pearl Innovation District and substantial investments in manufacturing, such as Siemens Energy’s upcoming expansion. These projects are expected to create thousands of high-wage jobs, further bolstering the local economy. As businesses and talent continue to flow into Charlotte, housing demand is anticipated to remain robust. The Metro’s standing as a financial and innovation hub, coupled with its diverse employment opportunities, continues to drive its growth. With new unit completions slowing, forecasts predict a rebound in rent performance by mid 2025, signaling a more balanced and sustainable market ahead.
Sources: Costar; ESRI; U.S. Census Bureau; Yardi Matrix; U.S. Bureau of Labor Statistics
