2022 Predictions for Charlotte Real Estate
What factors are experts keeping an eye on in 2022?
2021 saw real estate inventory in Charlotte struggling to keep up with demand. Location flexibility due to remote work, supply shortages, and low interest rates each played a role in the large gap between supply and demand in the area. Charlotte real estate professionals Peter Lazzopina and Andy Griesinger share their thoughts on what to expect in 2022.
Ongoing Supply Shortages
“I don’t think inventory is catching up anytime soon,” begins Griesinger. “Materials are still expensive for builders, and will be for a while. Even as supply shortages begin to get better, builders are still catching up on delayed projects from 2021.”
Lazzopina adds, “Just like in many industries right now, real estate is seeing a supply chain issue. This will be a continued issue for new construction in 2022.”
Interest Rates
Lazzopina and Griesinger agree that one major factor to keep an eye on is interest rates. “I don’t think there will be much of a change,” says Griesinger, “but we do have to keep an eye on it. If they keep going up, people may get worried that that upward trend will continue, and they might hurry to get into the housing market before that happens.”
Lazzopina’s outlook is similar. “Interest rates probably won’t rise enough to cause a major impact to the housing market,” he says. “However, they might make more of an impact on some price ranges than others. For example, if I can afford a mortgage payment of $2K per month, that amount is going to buy me more of a house now, with lower interest rates, than it will in a few months as those rates rise. Homes priced a bit higher will likely be more affected than lower-priced homes.”
Budgets
While the discrepancy between supply and demand continues to drive home prices up in Charlotte, the outlook of the market will come down to buyer budgets. “The cost of housing will always be capped by how much people really make in a month,” explains Lazzopina. There’s an upper limit.
However, Griesinger adds the caveat that some financial trends indicate a higher ceiling than we may have previously imagined. “With investments like crypto, some people are cashing out with enough to buy a home,” he says. “If people keep getting access to more money, we will continue to see more and more people flooding the market at every price point.”
New Additions in Charlotte
With new employers constantly moving into Charlotte, the demand for homes only continues to rise. “Amazon has brought quite a few people to the city,” says Lazzopina, “and we’re the second largest banking center in the country, with tens of thousands of employees. Some banking employees left the city during the lockdown, but are being asked to come back. We expect to see a wave from that in 2022.”
Griesinger adds, “LendingTree and Lowes are both bringing more people to the South End. There are plenty of employers creating or expanding headquarters here.” But it’s not all about work. “2022 will be our first year with a new major league soccer team, making us a city with three professional sports teams. Plus, we’ll be holding the President’s Cup, a large golf tournament. These events and teams bring a lot of attention to the city and they bring in a steady stream of visitors. For a lot of people, once Charlotte is on their radar, they want to move here.”
Additions like these are yet another reason why Griesinger and Lazzopina don’t foresee a large drop in the Charlotte market anytime soon.
New Communities
In response to the strong demand and competitive market, many buyers have expanded their search outside of the city. “There’s a large project underway about 40 minutes outside the city,” Lazzopina explains. “They’re building homes, a golf course, an amphitheater, and many other amenities in a community called Ballantyne. It’ll be a one-stop shop, a place where you can work, play, and live.”
This is part of an overarching trend, Lazzopina says, of builders constructing lower-priced homes on the outskirts of the city itself. He expects this to continue, since it gives people a chance to purchase larger or newer homes more affordably than they could have within the city.
The experts agree: this is no 2008, and the Charlotte real estate market will continue to see strong demand.
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