Charlotte, North Carolina-South Carolina Housing Market Area (HMA) Sales Market Expected for a Total of 11,600 New Rental Units (See Table 1)

Home , North Carolina

COMPREHENSIVE HOUSING MARKET ANAL YSIS Charlotte, North Carolina- South Carolina U.S. Department of Housing and Urban Development Office of Policy Development and Research As of April 1, 2007

Summary

Economy single-family homebuilding since 2000 increased the sales vacancy The Charlotte HMA is the second Housing Market Area rate slightly to 2.4 percent from largest banking center in the nation; 2.2 percent in 2000. During the area banks have $1.9 billion in forecast period, strong economic assets. Wachovia Corporation and growth and household growth are Bank of America Corporation are expected to result in demand for headquartered in Charlotte. During 54,550 new sales units (see Table 1). the 12 months ending March 2007, employment in the financial activities sector increased by 7.3 percent, Rental Market Iredell Davidson making the sector one of the fastest The rental market in the HMA is

Catawba Rowan growing employment sectors in the balanced. Strong population and HMA. During the same period, non- renter household growth during Lincoln the past 2 to 3 years, coupled with Cabarrus Stanly farm employment in the HMA was Gaston Mecklenburg strong, increasing by 3.6 percent. a decline in the construction of Employment during the forecast rental units, have allowed the market Union York Anson period is expected to increase by to recover from overbuilding that North Carolina an average of 3.2 percent annually, occurred during the late 1990s and South Carolina Chester with job growth concentrated in the early 2000s. Currently, the overall Chesterfield Lancaster financial services and professional rental vacancy rate is estimated at and business services sectors. 7 percent (see Table DP-1). During the forecast period, demand is The Charlotte, North Carolina-South Carolina Housing Market Area (HMA) Sales Market expected for a total of 11,600 new rental units (see Table 1). is conterminous with the Charlotte- The sales market in the HMA is bal- Gastonia-Concord, North Carolina-South anced but softening. Record-setting Carolina Metropolitan Statistical Area (MSA). For purposes of this report, the HMA is divided into three submarkets: the Mecklenburg County submarket; the Western Counties submarket, which includes Gaston County, North Carolina, Market Details and York County, South Carolina; and Economic Conditions...... 2 the Eastern Counties submarket, which is composed of the North Carolina counties Population and Households...... 4 of Cabarrus, Union, and Anson. Located Housing Market Trends...... 6 in Mecklenburg County, Charlotte is the largest city in North Carolina. Data Profiles...... 16 C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Summary Economic Conditions by Sector Table 2. Source: U.S.Bureau ofLaborStatistics Numbers maynot addtototalsbecauseofrounding. Notes: Basedon 12-month averagesthroughMarch 2006andMarch2007. Total NonfarmEmployment Source: Estimatesbyanalyst period. Unitsunderconstructionasof April 1,2007. Notes: Total demandrepresentsestimatedproductionnecessarytoachievea balancedmarketattheendofforecast Table 1. Under Construction Total Demand Service Providing Goods Producing Government Other Services Leisure &Hospitality Education &HealthServices Professional &Business Financial Activities Information Transportation &Utilities Trade Manufacturing Natural Resources, Mining,&

Continued Services Construction Employment Sector

12-Month Average Employment in the Charlotte HMA,

Housing DemandintheCharlotteHMA,3-Year Forecast, April1,2007to 1,2010 54,550 Sales Units 7,450 2006, employment growth acceler from 2002to2004,but,in2005and by lessthan1percenteachyear (see Table 2).Employment changed jobs, or3.6percent,to827,300jobs employment increased by28,800 the 12monthsendingMarch2007, and continues toexpand. During among manyemployment sectors N Charlotte HMA March 2006 12 Months 100,900 118,600 132,800 662,200 136,400 798,500 11,600 Ending Rental Units 36,700 74,400 68,800 72,800 21,500 35,800 82,900 53,500 3,400 Charlotte HMAisdivided employmentonfarm inthe March 2007 12 Months 26,800 Ending 102,400 124,900 136,700 686,700 140,600 827,300 Sales Units 4,250 37,600 76,700 72,300 78,100 21,600 36,300 82,700 57,900 Mecklenburg Submarket County Rental Units 3,400 8,200 Change Percent – 0.2 1.5 2.5 3.1 5.1 5.3 7.3 0.5 1.4 2.9 3.7 8.2 3.1 3.6 - 10,550 Western Counties Figure 1). from 5.0percent ayear earlier(see 4.7percent declined toanaverage of unemployment rateintheHMA 12 monthsendingMarch2007, the home healthcarebusinesses. For the increases inmedicalfacilitiesand months, primarily fromemployment by 3,500jobsduringthepast12 sectorexpanded and healthservices jobs. Employment intheeducation sectorby6,300 business services employment intheprofessionaland and consultingjobshelpedincrease companies.services New marketing hiringbyfinancialandinvestment of by 5,300jobs, primarily asaresult financial activities sectorincreased sectors.services Employment inthe tivities andprofessionalbusiness inthefinancialac growth occurred the sectors,service 40percentof inmultiplepast 12monthsoccurred 1990s. Althoughjobgainsduringthe growth, or21,000jobs, duringthe approximately 3.8percentannual rate fortheHMA,whichaveraged toamoretypical areturn represents tively. employment Current growth ated to2.9and3.6percent,respec 1,225 Sales Units Submarket 1,950 Rental Units 0 17,200 Eastern Counties Eastern 1,975 Sales Units Submarket 1,450 Rental Units 0 - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Figure 1. Source: U.S. BureauofLabor Statistics Note: Basedon12-month averagesthroughMarch 2007. Source: U.S.BureauofLaborStatistics Figure 2. Services 8.7% Education &Health Hospitality 9.3% Business Services15.1%

Other Services4.5% Labor Force & Resident Employment 500,000 600,000 700,000 800,000 900,000 Leisure & Government 12.4% Government Professional &

Economic Conditions Trends inLaborForce, ResidentEmployment,andUnemployment Rate intheCharlotteHMA,1990to2006 Current Employment in the Charlotte HMA, by Sector 1990 1992 1994 1996 1998 2000 2002 2004 2006 2004 2002 2000 1998 1996 1994 1992 1990 Labor Force Financial Activities9.4% Construction 7.0% Natural Resources, Mining,&

Information 2.6% Continued Resident Employment Manufacturing 10.0% & Utilities4.4% Transportation Trade 16.5% 34,000 jobs and account for 44 percent provide approximatelycorporations Charlotte. Together,of thetwo inthecity are headquartered largest banksintheUnitedStates, of America Corporation, two of the Wachovia andBank Corporation employment (seeFigure2). approximately 9 percentnonfarm of for 78,100jobsintheHMA,or the financial activities sector accounts between 2000and2006.Currently, 3,400 jobs, or6percent,annually HMA, increasingbyanaverage of growing employment sectorsinthe thefastest sector hasbeenoneof Since 2000,thefinancialactivities activities sector. Othermajor employment inthefinancial of UnemploymentRate Source: Charlotte ChamberofCommerce Note: Figuresfrom surveyconductedinJanuary 2007. Table 3. US Airways,Inc. Adecco S.A. Duke Energy Corporation Food Lion,LLC Wal-Mart Stores, Inc. Bank ofAmericaCorporation Wachovia Corporation Carolinas HealthCare System

Major EmployersintheCharlotteHMA Employer Name of 0.0 2.0 4.0 6.0 8.0

Unemployment Rate The NationalAssociationforStock MecklenburgCounty. of portion development inthenortheastern catalyst foreconomicandhousing serve asa and university staff additional 25,000people. Students in theUnitedStates, employs an university-affiliated researchpark Research Park, thesixthlargest 3,700 facultyandstaff.University (UNC Charlotte)employs nearly CarolinaatCharlotte North sity of than 21,500students, TheUniver more With afall2006enrollmentof HMA arelistedinTable 3. private-sector employers inthe to openin2010.Theattractionis in January 2007andisexpected Fame, whichbrokeground Hall of as thelocationforNASCAR the area.Charlottehasbeenchosen and accountedfor10,500jobsin $2.9 billionontheCharlotteregion had atotaldirectannual impactof estimates that,in2005,NASCAR 2006 study fromUNCCharlotte inthearea.A are headquartered year, andseveral NASCAR teams and otherautomotive events each Motor Speedway hostsseveral races Carolina,Lowe’sConcord, North the Charlottearea.Locatedin has amajoreconomicimpacton Car Auto Racing, Inc., (NASCAR) Transportation Business Services Utilities Retail Trade Retail Trade Financial Activities Financial Activities Health Services Employment Sector Employees Number of 12,918 13,960 20,000 26,283 4,981 5,000 7,500 8,658 - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Source: U.S.BureauofLaborStatistics Note: Currentisbasedon12-monthaveragesthroughMarch2007. Figure 3. – 402006080100 120140160 Sector Growth in the Charlotte HMA, Percent Change, 1990 to Current Economic Conditions Population andHouseholds

Continued manufacturing joblosses. In2003, all accounted for70percentof textile manufacturing employment the past12months. Lossesin HMA in1990to10percent employment nonfarm inthe of Manufacturing fellfrom23percent by 33percent(seeFigure3). manufacturing sectorhasdeclined Since 1990,employment inthe more than$60million. have anannual economicimpactof annually, create750new jobs, and expected todraw 400,000visitors two decadesfrom1millionin 1990 has grown rapidly duringthepast population intheCharlotte HMA able housing, andamildclimate, B growth, relatively afford strongemployment ecause of - business services sectors.business services andprofessional services be concentratedinthefinancial sectors. Growth isexpected to annually, withgainsinmultiple increase by an average 3.2 percent of employmentnonfarm isexpected to During the3-year forecastperiod, thestate. of in thehistory County,rus thelargest singlelayoff including 4,000workers in Cabar Carolina, 5,000 workers inNorth morethan andlaidoff bankruptcy the Pillowtex filedfor Corporation than inthe1990s. Inthelate1990s, (see Figure4), 12,600moreayear 43,200ayearated toanaverage of nual populationgrowth hasacceler (see Table DP-1).Since2000,an date thecurrent to 1.6millionasof Total NonfarmEmployment Service Providing Goods Producing Education &HealthServices Professional &BusinessServices Financial Activities Transportation &Utilities Trade Manufacturing Natural Resources, Mining, &Construction Government Other Services Leisure &Hospitality Information - - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Population andHouseholds analyst Sources: 1990and 2000—U.S.Census;currentand forecast—estimatesby Figure 5. analyst Sources: 1990 and 2000—U.S. Census; current and forecast—estimates by Figure 4. Average Annual Change Average Annual Change 10,000 20,000 30,000 40,000 10,000 20,000 30,000 40,000 50,000 60,000 ComponentsofPopulationChangeintheCharlotte PopulationandHouseholdGrowth intheCharlotte 0 HMA, 1990toForecast 0 HMA, 1990toForecast 1990 to2000 1990 to2000 Net NaturalChange Continued Population affordable housingforcommuters relativelyand theavailability of growth inthesuburbancounties DP-4) duetosteady employment been strong(seeTables DP-3and Countiessubmarketshas Eastern in boththeWestern Countiesand theHMA.Growth to otherareasof county withmoreconvenient access the providing outlying areasof 485 (I-485)hasbeencompleted, Interstate where anew sectionof thecounty of part to thenorthern during thepast3years hasshifted lenburg County;however, growth Meck of portion in thesouthern population growth was highest Western Countiessubmarket, and County, 25percentresidesinthe the HMAresidesinMecklenburg thepopulationin 52 percentof to MecklenburgCounty. Currently, 2000 toCurrent 2000 toCurrent Households Net Migration Current toForecast Current toForecast - population growth intheHMA, Since 2000,71percentof since 2000. growth levels thathave occurred is expected toexceed submarket tion growth ineachsubmarket nearly 1.8million.Average popula in theHMAisexpected toreach the forecastperiod,population 50,300ayear. Bytheendof of expected toaccelerateanaverage period, populationgrowth is to bestrongduringtheforecast As employment growth continues Counties submarket. 23 percentresidesintheEastern expected toreach 692,000. householdsis period, thenumber of burg County. Duringtheforecast with 54percentliving inMecklen households resideintheHMA, Currently, anestimated 631,600 units, or3.1percent,annually. 17,300 accelerated toanaverage of Since 2000,householdgrowth has 12,250,or2.8percent,eachyear. of households increasedbyanaverage During the1990s, thenumber of in employment andin-migration. has beenstrongduetoincreases household growth intheHMA During thepasttwo decades, warmer climateattractsretirees. professionals andfamiliesthe growth continues toattractyoung period asstrongemployment expected tocontinue intheforecast Thetrendis from netin-migration. populationgrowth hascome of submarkets, morethan75percent Counties Counties andEastern Carolina. InboththeWestern North from outlying countiesof statesand primarily fromnorthern has comefromnetin-migration, or 30,850people(seeFigure5), - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Housing Market Trends Figure 6. Source: U.S.CensusBureau,BuildingPermitsSurvey Notes: Includesonlysingle-familyunits.datathroughMarch 2007. Figure 7. Sources: 1990and 2000—U.S.Census;current—estimates byanalyst 10,000 15,000 5,000 100,000 150,000 200,000 250,000 50,000 0

0 1990

NumberofHouseholdsbyTenure intheMecklenburg County Submarket,1990toCurrent Single-Family BuildingPermitsIssuedinthe 1991 Mecklenburg CountySubmarket,1990to2007

1992

1993 1990 1994

1995

1996 highest number since1999(see 10 percentto9,300homes, the increased homespermitted, of ity, asmeasuredbythenumber activsingle-family construction vacancy ratesince2000.In2006, in aslightincreasethesales hasresulted housing construction strong since2000,record-level and householdgrowth have been Table DP-2).Althoughpopulation 2.5percent(see vacancy rateof is balanced,withanestimatedsales the MecklenburgCountysubmarket saleshousingmarketin The current Sales Market—MecklenburgCountySubmarket 1997 resulted inanincreasethehome- and favorable have lendingterms family units. Low interestrates approximately 9,075single- total of issued slowed to1percentfora single-family buildingpermits ending March2007,therateof Figure 6).For the12months Renter 1998

2000 1999

2000

Owner 2001

2002

2003 Current 2004

2005

2006 - According toCharlotteCenterCity dramatically in downtown Charlotte. hasalsoincreased construction During thepast5years, housing thecounty. of part to thenorthern salesconstruction of large portion UNCCharlottehave shifteda of I-485andthecontinued growth of lenburg County, buttheexpansion was Meck concentrated in southern late 1990s, housingconstruction households (seeFigure7).Inthe 64.5percent,or218,200 owner of 62.3 percent in 2000 to a current rate ownership rateinthecountyfrom County submarket. According in recentyears intheMecklenburg homes soldhave increasedsteadily existing The number andpriceof minium unitswere soldinthearea. in 2006 because more high-end condo- from 2005salespricesto$320,918 more than$50,000,or18percent, downtown Charlotte increasedby homesin The average salespriceof new condominiums.availability of primarily duetotheincreasing homessoldin2005, the number of 76-percent increasecomparedwith in downtown Charlottein2006, a Services, Inc., 534homeswere sold data fromCarolinaMultipleListing be condominiums. Accordingto lotte duringthenext 3years will to becompletedindowntown Char 8,000 new housingunitsscheduled the Approximately 90percentof downtown tobeclosework. single professionalswhomoved downtown residentsareyoung, the organizationfoundthatmost Charlotte. Asurvey conductedby ing unitsarelocatedindowntown Partners, approximately 6,800hous - - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Sales Market—MecklenburgCountySubmarket Housing Market Trends Source: Estimatesbyanalyst Figure 8. Sources: 1990and 2000—U.S.Census;current—estimates byanalyst Table 4. 10.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 500,000 400,000 300,000 250,000 225,000 200,000 175,000 150,000 115,000 From Price Range($)

Estimated DemandforNewMarket-RateSales April 1,2007to2010 Housing intheMecklenburg CountySubmarket,

Rental Vacancy RatesintheMecklenburg County Submarket, 1990toCurrent 1990 9.6 and higher 499,999 399,999 299,999 249,999 224,999 199,999 174,999 149,999 To 2005. Duringthesameperiod, 2,288 homes, or12percent,from the countyin2006,anincreaseof and existing homeswere soldin Listing Services, Inc., 21,413new to datafromCarolinaMultiple after thevacancy ratereacheda has tightened during the past 2 years market in Figure8.Theapartment vacancy rate 7.5 of percent, as shown balanced, withanoverall estimated Mecklenburg Countysubmarketis The rentalhousingmarketinthe Rental Market—MecklenburgCountySubmarket 2000 8.7 Continued Demand Units of 5,375 4,050 2,700 2,675 1,075 2,650 4,000 4,025 250 Current Percent of Total 7.5 20.1 15.1 10.1 10.0 14.9 15.0 0.9 4.0 9.9 homes. A portion of thatdemand homes. of Aportion demand isexpected for 26,800 During the3-year forecastperiod, from downtown Charlotte. developed neighborhoods away at$115,000innewlystarting limited amenitiescanbepurchased bathrooms, aone-cargarage, and homeswithtwo $194,009. Starter during 2006atanaverage priceof where 4,010homeswere sold MecklenburgCounty, of portion sold intherapidly growing northern homeswas The largest number of increased 4percentto$219,122. homes the average salespriceof March 2007, permits wereMarch 2007,permits issued show. Duringthe12months ending figures rentalunitsthanpermit of declineinthedevelopmentgreater condominiums, resultinginaneven since2000havepermitted been themultifamily units 20 percentof in theprevious 6years. Inaddition, productionrecorded the levels of beginning in2002comparedwith rental housingslowed dramatically of permits. Theconstruction for trendsinmultifamily building in thevacancy rate. See Figure 9 holds, accountsforthedecrease increaseinrenterhouse gradual combinedwitha units permitted, as measuredbythenumber of multifamily rentalunits, tion of 2002. Aslowdown intheconstruc morethan12percentin high of housing bypricerange. estimateddemandfornew sales of tion. SeeTable 4forabreakdown houses currently underconstruc homes, condominiums, andtown will bemetby4,250single-family - - - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Rental Market—MecklenburgCountySubmarket Housing Market Trends Figure 9. Source: Estimates byanalyst Notes: Distribution aboveisnoncumulative.Demand shownatanyrentrepresents demandatthatlevelandhigher. Table 5. Source: U.S.CensusBureau,BuildingPermitsSurvey Includes datathroughMarch2007. Notes: Includesallmultifamilyunitsinstructureswithtwoormoreunits. 1,000 2,000 3,000 4,000 5,000 6,000 Monthly Gross 0 and higher Rent ($) 1,400 1,300 1,200 1,100 1,000 1990 950 900 850 800 750 700

Estimated Demand for New Market-Rate Rental Housing in the Mecklenburg County Submarket, April 1, 2007 to April 1, 2010

Multifamily BuildingPermitsIssuedintheMecklenburg 1991 County Submarket,1990to2007 1 Bedroom

1992

1993 Demand Units of

1,000 1,100 1,300 1,475 1,650 1,775 2,025 1994 470 590 730 910 1995

1996

1997 survey in February 2007, the average According toaRealData, Inc., 12 months. duringthepast units permitted multifamily estimated 25percentof Condominiums accountedforan formultifamilyin permits units. has alsocontributedtotheincrease particularly indowntown Charlotte, inthecounty,nium construction the dramaticincreaseincondomi- creased duringthepast12months, in forapartments building permits previous 12-month period. Although units, a56-percentincreasefromthe for approximately 4,500multifamily 1998

1999

2000 Continued Monthly Gross

and higher 2001 Rent ($) 1,500 1,400 1,300 1,200 1,100 1,050 1,000

950 900 850 800 2002 2 Bedrooms

2003

2004 Demand Units of 2005 1,100 1,000 1,550 1,925 2,300 2,700 3,125 3,500 3,800 4,600 690 2006

2007 - connects I-77withI-85. I-485that sectionof southwestern nearthenew under construction wereI-485 and760apartments sectionof and thenew northern nearUNCCharlotte construction were2007, 470apartments under to RealData, Inc., inFebruary and averaged $1,133.According in anyotherRealData submarket higher indowntown Charlottethan 2006.Rentsary were significantly $687inFebruthe average rentof nearly 6percentfrom an increaseof burg Countysubmarketwas $727, intheMecklen rent forapartments forecast period. the until the2ndand3rdyears of additional unitswillnotbeneeded are currently underconstruction, an estimated3,400rentalunits bedrooms. Because and number of for rentalhousingbyrentrange estimateddemand breakdown of submarket. SeeTable 5fora units intheMecklenburgCounty demand is expected for 8,200 rental During the3-year forecastperiod, Monthly Gross and higher Rent ($) 3 orMore Bedrooms 1,600 1,500 1,400 1,300 1,200 1,150 1,100 1,050 1,000 950 900 Demand Units of 1,100 1,275 1,425 1,575 590 270 380 520 710 810 920 - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS Source: U.S.Census Bureau,BuildingPermitsSurvey Notes: Includesonly single-familyunits.Includes datathroughMarch2007. Figure 11. Figure 10. Sources: 1990and2000—U.S.Census;current—estimatesbyanalyst Housing Market Trends 1,000 2,000 3,000 4,000 5,000 100,000 120,000 140,000 0 20,000 40,000 60,000 80,000

1990 0

1991 Single-Family BuildingPermitsIssuedintheWestern Counties Submarket,1990to2007 Number ofHouseholdsbyTenure intheWestern Counties Submarket,1990toCurrent

1992

1993

1994 1990

1995 Continued

1996

1997 Renter result of a high level of new home ahighlevel of result of vacancy ratehasincreasedasa remained balanced,althoughthe Western Countiessubmarkethas the saleshousingmarketin household growth hasbeenstrong, and Table DP-3).Because owner 70.8 percentin2000(seeFigure10 increased to72.8percentfrom and thehomeownership ratehas increased toanestimated115,400 owner householdshas number of submarket hasbeenstrong. The ing unitsintheWestern Counties Since 2000,demandforsaleshous Sales Market—Western Counties Submarket 1998 3,550 single-family homes annually, permits were issued for an average of Between 2000and2006,building 2.5percent. estimateof a current increased from2percentin2000to Thesalesvacancyconstruction. rate

1999 2000 2000

2001 Owner

2002

2003

2004 Current

2005

2006

2007 - According todatafromCarolina for new subdivisions. land theavailability of because of inthesubmarket construction single-family home 60 percentof York Countyhave accountedfor areasof 2000, theunincorporated in 2000(seeFigure11).Since the nearly 2,800homespermitted 55percentmorethan permitted, 4,300 single-family homeswere during theperiod.In2006,arecord owner annually householdsformed 2,750new outpacing theaverage of relative affordability of homesin relative affordabilityof the for employment. Becauseof muted toMecklenburg County workers inGastonCountycom the approximately 26percentof According tothe2000Census, employed inMecklenburgCounty. commuters whoare number of primarily byanincreaseinthe Gaston County have been fueled 2006. Increasesinhomesales nearly 9percentto2,691homesin Gaston County, sales increasedby particularly nearLakeWylie. In housing demandinthecounty, sales of also makeupaportion County. Second-homepurchases commuted tojobsinMecklenburg York23,900 residentsof County housing inYork County. In2000, have increaseddemandforsales ing towork inMecklenburgCounty residentscommut large number of job growth inYork Countyandthe 17 percentto3,043units. Moderate County, homesalesin2006were up 2006, a13-percentincrease. InYork 5,070 unitsin2005to5,734 in thesubmarketincreasedfrom existing homessold number of Multiple ListingServices, Inc., the - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 10 Sales Market—Western CountiesSubmarket Housing Market Trends Table 6. Source: Estimatesbyanalyst 500,000 400,000 300,000 250,000 225,000 200,000 175,000 150,000 125,000 100,000 From

Price Range($) Estimated Demand for New Market-Rate Sales Housing April 1,2010 in theWestern CountiesSubmarket,April1,2007to and higher 499,999 399,999 299,999 249,999 224,999 199,999 174,999 149,999 124,999 To 2005. Pricesincreasedfasterin nearly 10percentfrom increase of averaged $190,450in2006,an Western Countiessubmarket ahomeinthe The salespriceof increased since2000. burg Countyisestimatedtohave commuters toMecklen number of those inMecklenburgCounty, the Gaston Countycomparedwith upward trend inthevacancy rate 2000 at1,400 units, resultinginan activity peakedin Construction the submarketwere apartments. all multifamily units producedin mid-1990s (seeFigure13).Nearly cantly inthesubmarketduring increasedsignifi unitspermitted, of units, asmeasuredbythenumber multifamily of The construction 7.0percent(seeFigure12). mate of esti from 7.8percenttoacurrent the submarkethasdeclinedslightly the overall rentalvacancy ratein currently balanced.Since2000, Western Countiessubmarketis The rentalhousingmarketinthe Rental Market—Western CountiesSubmarket Continued Demand Units of 1,050 1,900 2,125 1,575 1,250 530 420 530 640 530 Percent of Total 10.0 18.0 20.1 14.9 11.8 5.0 4.0 5.0 6.1 5.0 - - - $133,451. County increasedby6percentto sales priceforahomeinGaston 4 percentto$196,216.Theaverage home inYork Countyincreasedby properties, theaverage pricefora submarket. Excluding LakeWylie average homesalespriceforthe had asignificantimpactonthe 20 percentto$417,444in2006and and secondhomes, increasedby in York County, includingseasonal price forahomenearLakeWylie was $240,855.Theaverage sales County, ahome theaverage priceof submarket intheHMA.InYork this submarketthaninanyother in GastonCounty from2001to than 5,600manufacturing jobs more thelossof County becauseof soft longer thanithasinYork market inthecountyhasremained County since2000,theapartment inGaston construction apartment cutbacksin balanced. Despitesharp 2007,andconditionsarenow ary gradually to6.3percentinFebru same timebuttheratedeclined units thatbecameavailable atthe new due tothelarge number of 16.8percentinAugust 2002 of rate inYork Countyreachedahigh RealData, Inc., the apartment vacancy beginning in2001.Accordingto price range. Western Countiessubmarket by for new saleshousing in the estimateddemand breakdown of in thesubmarket.SeeTable 6for a are currently underconstruction sales units. An estimated 1,225 homes demand is expected for 10,550 new During the3-year forecastperiod, - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 11 Rental Market—Western CountiesSubmarket Housing Market Trends Figure 13. Figure 12. Sources: 1990and2000—U.S.Census;current—estimatesbyanalyst Source: U.S.CensusBureau,BuildingPermitsSurvey Includes datathroughMarch2007. Notes: Includesallmultifamilyunitsinstructureswithtwoormore units. 1,000 1,500 500 0 10.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 1990

1991

Multifamily BuildingPermitsIssuedintheWestern Counties Submarket,1990to2007 Rental Vacancy RatesintheWestern Counties Submarket, 1990toCurrent 1992

1993

1994 1990 7.8

1995

1996

1997 occupancy or rental information. occupancy orrentalinformation. Gaston Countywould notdisclose managers surveyedapartment in all of thatmorethanhalf reports 2007;however,ary RealData, Inc., but declinedto8percentinFebru 2003 11.6percentinFebruary of in GastonCountyreachedahigh vacancy2006. Theapartment rate 1998

1999 2000 Continued 7.8 2000

2001

2002

2003 Current

2004 7.0

2005

2006

2007 - that average rentsinthecountyare disclose rentalrates, we estimate in GastonCountythatwould not properties apartment the number of recorded ayear earlier. Becauseof nearly 6percentfromtheaverageof 2007,anincrease $615 inFebruary In GastonCounty, rentsaveraged age 2006. recordedinFebruary nearly 6percentfromtheaver of 2007,anincrease $662 inFebruary average rentinYork Countywas According toRealData, Inc., the 8percent. the reported vacancy rateinthecountyexceeded For thisreason,we estimatethatthe absorbed. excess vacant unitsbe supply of the forecastperiodtoletcurrent needed untilthe2ndor3rdyear of in GastonCountywould notbe York County. Anyunitsproduced units willbeneededprimarily in conditions inGastonCounty, new theslightly softrentalmarket of bedrooms. Because and number of for rentalhousingbyrentrange submarket. SeeTable 7fordemand rental unitsintheWestern Counties demand isexpected for 1,950new During the3-year forecastperiod, lower rates. thanthereported - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 12 Rental Market—Western CountiesSubmarket Housing Market Trends Figure 15. Source: U.S.CensusBureau,BuildingPermitsSurvey Notes: Includesonlysingle-familyunits.datathroughMarch2007. Sources: 1990and2000—U.S.Census; current—estimatesbyanalyst Figure 14. 2,000 4,000 6,000 8,000 Source: Estimatesbyanalyst Notes: Distributionaboveisnoncumulative.Demandshownatanyrentrepresentsdemandthatlevelandhigher. Table 7. 100,000 120,000 0 20,000 40,000 60,000 80,000 Monthly Gross and higher

0 1990 Rent ($) 1,300 1,200 1,100 1,000

900 850 800 750 700 650 600 Estimated Demand for New Market-Rate Rental Housing in the Western Counties Submarket, April 1, 2007 to April 1, 2010 Single-Family Building Permits Issued in the Eastern Single-Family BuildingPermitsIssuedintheEastern Counties Submarket,1990to2007 Number ofHouseholdsbyTenure intheEastern Counties Submarket,1990toCurrent 1991

1992 1 Bedroom

1993

1990 1994 Demand Units of

1995 240 110 140 180 220 270 320 360 400 440 500

1996

1997 Renter 1998 Sales Market—EasternCountiesSubmarket

1999 2000 Continued 2000

2001 Monthly Gross Owner and higher Rent ($) 2002 1,400 1,300 1,200 1,100 1,000 950 900 850 800 750 700

2003 2 Bedrooms

Current 2004

2005 Demand Units of 2006 1,050 260 160 240 370 460 540 640 740 830 900

2007 submarket since1990. in housingandvacancies inthe See Table DP-4 for additional trends submarket, asshown inFigure15. 108,400 owner households are in the in MecklenburgCounty. Currently, housing andaccesstoemployment relativelyavailability affordable of submarket intheHMA,dueto any increaseof the highestrateof 80.4percent, estimateof a current creased from 77.3 percent in 2000 to ly, thehomeownership ratehasin 1.9percent.Corresponding rate of 1.8 percentin2000toacurrent rate has increased only slightly, from to remainbalanced;thevacancy Countiessubmarket in theEastern enough forthesaleshousingmarket household growth hasbeenstrong year beginning in 2001 (see Figure 14), family issuedeach buildingpermits single- Despite arecordnumber of Monthly Gross and higher Rent ($) 3 orMore Bedrooms 1,500 1,400 1,300 1,200 1,100 1,050 1,000 800 950 900 850 Demand Units of 150 100 130 180 200 230 280 320 360 400 70 - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 13 Sales Market—EasternCountiesSubmarket Housing Market Trends Mecklenburg County. Since2000, homes andlarger lotsthanthosein owners seekingrelatively affordable become analternative forhome two decades, UnionCountyhas County in2005.Duringthepast homessoldinUnion number of 9percentfromthe an increaseof were locatedinUnionCounty, in thesubmarket,or4,312homes, allhomessold of More thanhalf number soldintheprevious year. 14percentfromthe increase of Counties submarketin2006,an homes were soldintheEastern Listing Services, Inc., 8,026existing According toCarolinaMultiple in the Eastern Countiessubmarket in theEastern 2006, theoverall homesalesprice Multiple ListingServices, Inc., in According todatafromCarolina than subdivisions inUnionCounty. in subdivisions withhigherdensity units since2000hasprimarily been new housingsales development of a smallergeographicalarea,the Countycoversbecause Cabarrus it hasbeeninUnionCountyand ment hasbeenmoreextensive than stable. Becauseresidentialdevelop Countyhasbeen more in Cabarrus population andhouseholdgrowth new residentssince2000, of influx County, whichhashadarapid County.Cabarrus UnlikeUnion demand fornew owner housingin to MecklenburgCountyhasfueled primarily fromresidentscommuting in 2005.Stronghouseholdgrowth 20 percentfromthenumber sold homes were soldin2006,upby County,In Cabarrus 3,554existing has acceleratedhouseholdgrowth. forUnionCountyresidents services moreretailand the development of Continued - - than 1percentfromthenumber less the submarket,anincreaseof family homeswere in permitted In 2006,arecord6,700single- recorded in2005. 6percentfromprices increase of County averaged $181,663,an county. HomepricesinCabarrus landincludedwithhomes inthe of market, partiallyduetotheamount the othertwo countiesinthesub significantly higherthanpricesin Union Countyaveraged $277,086, recorded in2005.Homeprices increase fromtheaverage price averaged $230,968,a5-percent price range. demand fornew saleshousingby homes. SeeTable 8forestimated single-family of by theconstruction demand isexpected tobesatisfied has beenvery limited.Nearly all condominiums of construction single-family communities, the of submarket isprimarily madeup in thesubmarket.Because are currently underconstruction submarket. An estimated 1,975 homes Counties units intheEastern demand isexpected for17,200sales During the3-year forecastperiod, previous 12months. high number issuedduringthe 8-percent decline from the unusually family unitsinthesubmarket,an werepermits issuedfor6,400single- period endingMarch2007,building County. Duringthe12-month and lessthan1percentforAnson with 40 percent for Cabarrus County in thesubmarket2006,compared single-family building permits issued all accounted for59percentof in2005.UnionCounty permitted - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 14 Sales Market—EasternCountiesSubmarket Housing Market Trends Source: U.S.Census Bureau,BuildingPermitsSurvey Includes datathrough March2007. Notes: Includesall multifamilyunitsinstructures withtwoormoreunits. Figure 17. Sources: 1990and2000—U.S.Census;current—estimatesbyanalyst Figure 16. 1,000 1,500 500 0 10.0 1990 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0

1991 Multifamily Building Permits Issued in the Eastern Multifamily BuildingPermitsIssuedintheEastern Counties Submarket,1990to2007 Rental Vacancy Counties RatesintheEastern Submarket, 1990toCurrent

1992

1993

1994 1990 6.6

1995

1996

1997 Rental Market—EasternCountiesSubmarket Source: Estimatesbyanalyst ments, have andbuildingpermits in thesubmarkethave beenapart all multifamily unitsconstructed 5percent(seeFigure16).Nearly of rently balanced,withavacancy rate Countiessubmarketis cur Eastern The rentalhousingmarketinthe Table 8. 1998

1999 Continued 2000 6.9 2000

Estimated DemandforNewMarket-RateSalesHousinginthe Eastern CountiesSubmarket,April1,2007to2010 Eastern 2001 500,000 400,000 300,000 250,000 200,000 175,000 150,000 125,000 100,000 From 2002 Price Range($) 2003

2004 Current 5.0

2005 and higher 499,999 399,999 299,999 249,999 199,999 174,999 149,999 124,999 2006 To 2007 - - February 2002. WithFebruary the cutbackin 1999 tomorethan14percent in creased from7.1percentin August vacancythe apartment ratein result, RealData, that Inc., reports County. inCabarrus occurred Asa multifamily activity buildingpermit therecord-setting 90 percentof submarket total.In1999,morethan the accounting for55percentof County,mained highestinCabarrus multifamily hasre construction are themostaccessible. Since2000, routesintoCharlotte transportation County,located inCabarrus where Countiessubmarketare Eastern multifamily rentalunitsinthe all Approximately 65percentof was 6.9percent(seeTable DP-4). since 2000,whenthevacancy rate sult, therentalmarkethastightened renter householdgrowth. Asare andstable construction apartment absorbed duetoaslowdown in in thesubmarket,rentalunitswere strong shifttoward homeownership 1999 (seeFigure17).Despitethe morethan1,200unitsin a highof declined eachyear since2000from Demand Units of 1,025 2,750 3,450 3,100 2,750 1,725 680 860 860 Percent of Total 16.0 20.1 18.0 16.0 10.0 6.0 4.0 5.0 5.0 - - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 15 Rental Market—EasternCountiesSubmarket Housing Market Trends Source: Estimates byanalyst Notes: Distribution aboveisnoncumulative.Demand shownatanyrentrepresents demandatthatlevelandhigher. Table 9. Monthly Gross and higher Rent ($) 1,400 1,300 1,200 1,100 1,000 950 900 850 800 750 700

Estimated Demand for New Market-Rate Rental Housing in the Eastern Counties Submarket, April 1, 2007 to April 1, 2010 1 Bedroom Demand Units of 250 120 150 180 230 270 330 370 410 450 510 constructed forpeopleemployedconstructed in ments inUnionCountyaremainly County. For that reason,apart than commuting fromCabarrus County ismoretimeconsuming Commuting to Charlotte from Union 2006. in February increase from average rents recorded county averaged $615,a4-percent was 5.8percentandrentsinthe the vacancy rate in Cabarrus County 2007, balanced again.InFebruary excess vacant unitsandhasbecome growth, the market has absorbed the 2000 andstrongrenterhousehold since production thathasoccurred has resultedinlarger swings in properties. Thesmallerrentalstock new rental the development of growth inthecountyhave spurred tion growth and rapidemployment in UnionCounty. Strongpopula since2000islocated has occurred multifamily that construction of County, approximately 45percent County asithasbeeninCabarrus cally hasnotbeenaslarge inUnion multifamily rentalhousinghistori the county. Althoughthestockof Continued Monthly Gross and higher Rent ($) 1,500 1,400 1,300 1,200 1,100 1,050 1,000 950 900 850 800 2 Bedrooms Demand Units of 170 110 160 250 300 360 430 500 550 600 730 - - - During theforecastperiod,demand 3 percentto$623. morethan average rentincreaseof 2007andan 4.3 percentinFebruary vacancywith anapartment rateof market, whichhasbecometight, the past2years the hasinfluenced during construction apartment in August 2003.Thedeclinein vacancy rate to more than 18 percent sulted inadramaticincreasethe than 200 apartments each year re fewer August 1999.Theadditionof rate inthecountywas 7.9percentin Data, Inc., vacancy theapartment vacancy rates. AccordingtoReal bedrooms. ket byrentrange andnumber of for rentalhousinginthesubmar See Table 9forestimateddemand matic increasesinthevacancy rate. Union Countywithoutcausingdra rentalunits each year in number of alimited allow fordevelopment of and alarger rentalstockshould however, anincreasingpopulation County; to beneededinCabarrus units. Mostnew unitsareexpected is expected for1,450new rental Monthly Gross and higher Rent ($) 3 orMore Bedrooms 1,600 1,500 1,400 1,300 1,200 1,150 1,100 1,050 1,000 950 900 Demand Units of 100 110 130 150 180 200 210 80 40 50 70 - - - - C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 16 Data Profiles Sources: Estimatesbyanalyst;U.S.CensusBureau;Department ofHousingandUrbanDevelopment Notes: Medianfamilyincomesarefor1989,1999,and2007.NA =dataarenotavailable. Table DP–2. Sources: Estimatesbyanalyst;U.S.CensusBureau;DepartmentofHousingandUrbanDevelopment Notes: Medianfamilyincomesarefor1989,1999,and2007.NA =dataarenotavailable. Table DP–1. Median FamilyIncome Rental Vacancy Rate(%) Owner Vacancy Rate(%) Total HousingUnits Percent Renter(%) Rental Households Percent Owner(%) Owner Households Total Households Total Population Median FamilyIncome Rental Vacancy Rate(%) Owner Vacancy Rate(%) Total HousingUnits Percent Renter(%) Renter Households Percent Owner(%) Owner Households Total Households Total Population Nonfarm Employment Unemployment Rate(%) Total ResidentEmployment Mecklenburg CountySubmarketDataProfile, 1990toCurrent CharlotteHMADataProfile, 1990toCurrent

1,024,643 415,715 132,993 254,932 387,925 550,200 562,394 1990 216,416 119,563 200,219 511,433 34.3 65.7 80,656 1990 8.8 1.9 3.2 NA 40.3 59.7 9.6 2.5 NA 1,330,448 546,447 165,668 344,848 510,516 766,800 709,332 292,780 103,023 170,393 273,416 695,454 2000 2000 32.5 67.5 37.7 62.3 8.2 2.2 3.4 NA 8.7 2.4 NA 1,633,000 366,900 119,900 218,200 338,100 856,700 Current 685,900 189,600 442,000 631,600 827,300 794,309 $60,200 Current 35.5 64.5 30.0 70.0 7.5 2.5 NA 7.0 2.4 4.7

1990 to2000 1990 to2000 Average AnnualChange(%) Average AnnualChange(%) 2.8 2.2 3.1 2.8 2.6 3.4 2.3 NA 3.1 2.5 3.6 3.2 3.1 NA 2000 toCurrent 2000 toCurrent 3.3 1.9 3.6 3.1 3.0 1.1 1.6 NA 3.3 2.2 3.6 3.1 3.0 NA C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 17 Data Profiles Table DP–3. Sources: Estimatesbyanalyst;U.S.CensusBureau;DepartmentofHousingandUrbanDevelopment Note: Medianfamilyincomesarefor1989,1999,and2007.NA =dataarenotavailable. Table DP–4. Sources: Estimatesbyanalyst;U.S.CensusBureau;Department ofHousingandUrbanDevelopment Notes: Medianfamilyincomesarefor1989,1999,and2007.NA =dataarenotavailable. Total Households Total Population Rental Households Percent Owner(%) Owner Households Percent Renter(%) Owner Vacancy Rate(%) Total HousingUnits Median FamilyIncome Rental Vacancy Rate(%) Median FamilyIncome Rental Vacancy Rate(%) Owner Vacancy Rate(%) Total HousingUnits Percent Renter(%) Rental Households Percent Owner(%) Owner Households Total Households Total Population

Continued Western CountiesSubmarketDataProfile, 1990toCurrent Eastern CountiesSubmarketDataProfile, Eastern 1990toCurrent

306,590 112,353 119,571 206,620 79,059 33,294 79,728 19,043 56,310 75,353 1990 1990 29.6 70.4 25.3 74.7 7.8 1.3 NA 6.5 1.5 NA 134,987 354,979 144,903 108,764 102,113 280,015 39,457 95,530 23,188 78,925 2000 2000 70.8 29.2 22.7 77.3 2.0 7.8 NA 6.9 1.8 NA 144,900 108,400 134,900 368,000 158,600 408,300 115,400 174,100 Current Current 26,500 43,200 19.6 80.4 72.8 27.2 5.0 1.9 NA 2.5 7.0 NA

1990 to2000 1990 to2000 Average AnnualChange(%) Average AnnualChange(%) 3.2 2.0 3.4 3.1 3.1 NA 1.5 1.9 1.7 1.9 1.9 NA 2000 toCurrent 2000 toCurrent 4.2 1.9 4.6 4.1 4.0 NA 2.0 2.3 1.3 2.7 2.7 NA C h a r l o t t e , N C - S C • COMPREHENSIVE HOUSING MARKET ANALYSIS 18 pdf publications/pdf/CMARtables_CharlotteNC. market forthisHMA,goto For tothehousing additionaldatapertaining the development pipeline. orunitsin for unitscurrently underconstruction excess vacancies. Theestimatesdonotaccount theanalysis, growth, losses, and dateof the as-of the3-year forecastperiodgiven conditionson of needed toachieve abalancedmarketattheend thetotalhousing production the estimatesof buildingactivity.are notaforecastof Theyare Demand: Thedemandestimatesintheanalysis estimates Forecast period:4/1/2007–4/1/2010—Analyst’s date:4/1/2007—Analyst’sCurrent estimates 2000: 4/1/2000—U.S. DecennialCensus 1990: 4/1/1990—U.S. DecennialCensus Data DefinitionsandSources . www.huduser.org/publications/econdev/mkt_analysis.html For on othermarketareas, additionalreports pleasego to www.huduser.org/ mortgage insuranceproposalsthatmaymortgage beunder any of regardingtheacceptability determinations trends. tomake Theanalysis doesnotpurport with localhousingmarketconditionsand to builders, mortgagees, andothersconcerned findings, andconclusionsmay alsobe useful in itsoperations. Thefactualinformation, HousingandUrbanDevelopment (HUD) of theU.S.assistance andguidanceof Department This analysis forthe hasbeenprepared [email protected] 404–331–5001, ext. 2475 Atlanta HUDRegional Office Tammy Fayed, FieldEconomist Contact Information and housingmarketconditions. provided onlocaleconomic dataandinformation and statelocalgovernment officials who sources express itsappreciation tothoseindustry by subsequentdevelopments. HUDwishesto such, findingsorconclusionsmay bemodified datefromlocalandnational sources. As as-of availableas possiblebasedoninformation onthe analysis andfindingsareasthoroughcurrent Economic andMarketAnalysis Division. The the guidelinesandmethodsdeveloped byHUD’s The factualframework forthisanalysis follows consideration bytheDepartment. .