As you have likely noticed, the world is changing and so are the people living in it.
What does this mean for the Charlotte rental market?
It means apartment living is where it’s at for tenants, at least lately. You may have noticed that Charlotte has a lot of new construction happening to meet a rising population and a steady demand for rentals. That new construction is predominantly apartment buildings.
We’re not ready to say RIP to the single-family rental home in Charlotte just yet, but we do want to point investors in the direction of multifamily properties, especially apartments. There’s a thriving market in Charlotte and the entire metro area, and it’s a great way to diversify and strengthen an existing portfolio of rentals.
The data we’ve collected tells us that 15,000 apartment units will be available by the end of 2024. That’s a record. Let’s take a look at some of the key factors contributing to this boom in Charlotte’s demand for apartments.
Shifting Charlotte Tenant Demand and Demographics
Home buying slowed down over the last year or two, thanks to higher interest rates and more expensive mortgages. As people began settling into the idea of renting for a longer period of time, they began to prioritize affordability and ease over the space and privacy that often comes with single-family homes.
More and more renters are living along, and that means a three-bedroom home is unnecessary. Smaller apartment units that maximize space are becoming more attractive to single renters and married tenants without children.
There’s also a rise in remote workers. These renters spend more time in their homes, and so having built-in amenities within a building can help them feel more connected to others. Many new apartment buildings come with clubhouses and fitness centers and pools. These features are attractive to all tenants, but especially those who are living and working in the same space.
We’re also seeing a lot of retirees looking for Charlotte apartments to rent. These renters typically want to stay active, but they don’t want the hassle of home maintenance or yard work. Renting an apartment where maintenance needs are taken care of and landscaping is off the table is extremely attractive to active adults.
Inflation and higher costs of living across the country have also pushed people into apartments. Many apartment communities are offering reduced move-in costs, lower security deposits, and other incentives. Tenants are taking advantage of these deals and discounts.
Increasing Population and Growing Local Economies
According to recent statistics, the current metro area population of Charlotte in 2024 is 2,321,000. This represents a 2.38% increase from 2023. That’s a pretty big jump in the number of residents who are moving into Charlotte. These newcomers need homes, and Charlotte apartments are exactly what they’re looking for, even if they plan on buying a home of their own one day. Arriving in a new city does not always mean an automatic home purchase. Many people like to rent for a year or two so they can get a feel for where they want to buy.
Why is Charlotte enjoying such tremendous population growth?
- Cost of living. The cost of living in Charlotte is rising, but it’s still a lot lower than many east coast cities. Residents here spend less on housing, utilities, insurance, groceries, and gas than they do in a number of other large metropolitan areas.
- Quality of life. While the cost of living might be low, the quality of life is high. Charlotte has so much recreation and entertainment. People come here to enjoy their lives instead of struggling against some of the challenges that come with living in larger cities. There are parks and green spaces even in the middle of the city, driving apartment living to new heights. People want to be able to walk to their favorite restaurants and shops. Apartments in Charlotte provide that.
- Strong job market. People come to Charlotte for work and for school. There are a number of established companies here as well as a surging tech market and some new start-ups and small businesses that are contributing to the local culture, the job market, and the innovative energy in this city.
There’s also the climate, which is pretty mild, and the proximity to other fantastic cities in the south and up and down the Atlantic seaboard. Charlotte has an international airport, professional sports teams, and lots of nature. People have always visited the area, and more of them are choosing to stay.
Charlotte’s Investment in Infrastructure and Transportation
Another factor boosting Charlotte’s real estate trend towards apartment buildings is its ongoing infrastructure and transportation improvements. The expansion of the Lynx Blue Line light rail, development of new bus routes, and enhancements to major highways have significantly improved connectivity in the region.
These developments make commuting easier and more attractive for residents, further strengthening demand for apartments near transit hubs.
Charlotte’s downtown area, known locally (and maybe ironically?) as Uptown, has undergone extensive revitalization. The development of mixed-use projects, which combine residential, commercial, and retail spaces, has made Uptown a desirable place to live and work. The blend of convenience, lifestyle amenities, and proximity to business districts makes these projects especially appealing to tenants as well as investors looking for profitable opportunities within a city center.
Investing in Charlotte Apartments
North Carolina, and Charlotte in particular, is known for its pro-business environment. The state’s low corporate tax rates, minimal regulatory hurdles, and incentives for new businesses encourage investment and economic growth. This favorable climate extends to real estate investment, offering opportunities for high returns. The increasing demand for rental properties ensures a steady stream of potential tenants, making apartment buildings a lucrative option for investors.
If you’re looking for your first investment opportunity in Charlotte, or thinking about ways to expand your portfolio, apartment buildings and even units within those buildings might be your next smart steps.
Looking for guidance on the Charlotte market in general or the apartment market in particular? We’re your best Charlotte property management resource. Contact our team at AM Realty.
