Charlotte apartment rents fall as new housing surges

Demand for apartments is rising, but supply is increasing even faster

The following article appeared in the November 27, 2023, edition of The Charlotte Ledger, an email newsletter with smart and original information for Charlotte. Sign up for free:

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Charlotte’s apartment construction boom is leading to lower rents, data shows; -4.6% in South End

The recent surge of apartment construction in Charlotte is pushing rents down, even in some of the hottest areas of town.

New data from real estate information company CoStar Group shows that average rents are down 4.6% in South End, 3% in uptown and 2.2% in SouthPark, compared with a year ago. Apartment vacancies in the Charlotte region have hit a record high of 10.7%.

It’s simple supply and demand at work: The number of people moving into apartments in the Charlotte region is increasing (+6,500 this year), but the number of apartments available is increasing even faster (+11,000), resulting in higher vacancy levels that are forcing apartment owners to drop rents.

“We have started to see supply catch up with and now exceed demand, which is leading new and existing properties to compete for renters by lowering asking rents and offering concessions,” says Chuck McShane, CoStar’s director of market analytics in the Carolinas.

In early November, the average rent for market-rate units was $1,559/month, down from $1,589 a year earlier. But it’s still above the $1,271/month in November of 2019.

And don’t expect spikes in rents anytime soon, McShane says, because there are 31,000 apartments under construction in the Charlotte region. But fewer groundbreakings this year could translate to tighter supplies and higher rents in late 2025 and 2026, he says.

Here’s the breakdown of average rent changes in the last year by submarket:

• Union County, +1.3%

• Gaston County, +0.8%

• East Charlotte, -0.4%

• Iredell County, -1.1%

• Cabarrus County, -1.2%

• University, -1.2%

• South Charlotte, -1.7%

• North Charlotte, -1.8%

• SouthPark, -2.2%

• Huntersville/Cornelius, -2.3%

• Uptown Charlotte, -3%

• West Charlotte, -3.3%

• South End, -4.6%

• York County, -4.8%

—TM

Related Ledger article:

• “Charlotte’s rising rents take a break” (🔒, Oct. 5, 2022)

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