Charlotte, North Carolina, is one of the hottest spots in the United States. From 1990 to 2000, its population grew by 36.6%: From 395,934 people to 540,828. From 2000 to 2010, it surged by another 35.2%: From 540,828 to 731,424 people. And though less but still impressive, from 2010 to 2020, Charlotte’s population grew by almost one-fifth, from 731,424 people to 874,579.
All this growth has not coincidentally led to a major surge in housing market activity in Charlotte. The city was already bubbling before the pandemic-induced frenzy of homebuying activity in 2021 and 2022. Read on to find out key trends developing in the Charlotte housing market in 2023 and how likely a housing market crash could be.
Charlotte Housing Market 2023: Overview
Through our analysis of housing data sourced from Redfin
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The median sale price for a home in the Charlotte metro area reached a peak of $410,000 in June 2022. As recently as July 2023, the median sale price was $400,000. As of September 2023 (the most updated data available), the median sale price in the Charlotte metro area is $390,000 — unchanged from September 2022.
For the city of Charlotte proper, home prices peaked just back in June 2023, with a median sale price of $425,000. That’s up by 5.1% from $385.500 in September 2022. More importantly, the new, higher price levels in the Charlotte housing market established in the wake of the pandemic are here to stay. Comparing 12-months average home prices make this clearer. For the 12-month period October 2022 to September 2023, the average median sale price in Charlotte was $399,573. Compare that to $319,083 for the period October 2020 to September 2021 and $271,873 for the period October 2019 to September 2020.
Below is a table of the 24 housing markets in the Charlotte metro area we examined, ranked in order of greatest year-over-year growth in home prices:
The city of Waxhaw, which is between 25-30 miles south of Charlotte, experienced the largest year-over-year growth in home prices. It’s also one of the fastest growing cities in the state. From a median sale price of $600,000 in September 2022, prices rose by 30%, reaching a median sale price of $780,000 in September 2023. The city of Matthews is closer to Charlotte and to the southeast. Its median sale price rose by more than a quarter (27.2%), from $458,000 in September 2022 to $582,500 in September 2023.
Meanwhile, Weddington, which is between Waxhaw and Matthews, experienced the largest year-over-year decline in home prices. But they came down from lofty heights. In September 2020, the median sale price in Weddington was $730,277. It then surged to $1,224,997 by September 2022. A year later and the median sale price has fallen by 20.4%, to $975,000 as of September 2023.
Inventory in the Charlotte Housing Market Continues to Drop
In contrast to many other major housing markets, like the Las Vegas housing market, which have seen their housing inventory buildup, in Charlotte this is not the case at all. Only five out of the 24 housing markets we analyzed in the greater Charlotte area witnessed increases in available inventory year-over-year. For the Charlotte metro area overall, available inventory dropped by 16.2%, from 8,720 homes for sale in September 2022, down to 7,305 homes in September 2023. In Charlotte proper, the decline was steeper, with a drop of 22.1%, from 2,476 available homes in September 2022, down to 1,929 available homes in September 2023.
In Indian Trail, a suburb southeast of Charlotte, next to Matthews, available inventory was cut in half. It declined by 51.7%, from 172 available homes in September 2022 to 83 available homes in September 2023. This diminishing inventory is most likely putting downward pressure on the number of active listings, which declined by 45% year-over-year. On the flip side is Harrisburg, a suburb to the northeast. It’s seen its inventory expand by 23.1%, from 65 homes for sale in September 2022 to 80 homes for sale in September 2023. Accordingly, prices have dropped there, with the median sale price in Harrisburg falling by 7%, from $505,500 last September to $470,000 this September.
The Percentage of Active Listings With Price Drops Has Decreased
One of the more useful metrics for analyzing housing market activity is the percentage of monthly active listings that have had their listed price reduced. In times when sellers are trying to move homes, typically there is an uptick in the percentage of active listings with price drops. On the other hand, in times when demand is high and inventory is low, it is more likely that price drops will decrease.
That’s essentially what happened with most of the Charlotte area. In the city of Charlotte, one third of active listings in September 2022 had price drops. That figure fell to only 27.1% by September 2023. For the Charlotte metro area overall, almost 35% of active listings had price drops in September 2022, before falling to 27% in September 2023.
Below is a table detailing the trends in the percentage of active listings with price drops in the 24 areas we analyzed in the greater Charlotte housing market:
The Bottom Line on a Charlotte Housing Market Crash
Based on the data and our analysis, it does not seem like the Charlotte housing market will crash. One of the biggest indicators of a looming housing crash is a significant stockpiling of housing inventory. That definitely has not occurred in the Charlotte housing market. While it’s true homes for sale are sitting on the market longer than last year in the Charlotte metro area, but in the city of Charlotte proper houses are spending fewer days on the market compared to last year.
Another important thing to look at when trying to anticipate a crash is the sales-to-list ratios of housing markets in a certain area. For example, when you have a sale-to-list price ratio of 99%, that means a home was sold for 1% under its list price. A sale-to-list price ratio of 101% means a home sold for 1% over its list price. During housing bubbles, sales-to-list ratios tend to soar passed 100% as homebuying drives up the final sale price. In housing crashes, the opposite is true, as the original listed price sits on the market without being sold and thus has a lower final sale price when it’s finally bought.
In the Charlotte housing market, sales-to-list ratios have been very stable over the last three and even five years. There have been fluctuations, with some cities surpassing 100%, but the highest sales-to-list ratio reached in the Charlotte housing market was 101.1%, in Matthews in September 2023.