In the Charlotte, NC region, housing remains relatively strong, although it has slowly started to cool somewhat from its peak in the middle of 2022. The pandemic drove up prices and demand all over the country, but Charlotte was identified early on in 2023 as still being one of the hottest housing markets of the year. It has remained a strong market, but that is beginning to change.
While some areas of the country are starting to see more homes on the market and a modest dip in prices, the Charlotte area is still seeing lower inventory, higher demand, and modest gains in the price of housing. Predictions indicate that this will continue to cool off in Q4, though, citing problems with mortgage rates and the cost of inflation. Here's what to consider for Q4.
Mortgage Rates Haven't Cooled Off Yet
The most significant consideration regarding Q4 housing market predictions in the Charlotte, NC, region is mortgage rates. They're still high, and there doesn't seem to be much of a chance of them coming down anytime soon. Not only is that keeping some people from buying because they don't want to pay high rates, but it's also pricing some people right out of the market entirely.
With the substantial increase in home prices that the Charlotte area experienced, homes cost more than they used to. When mortgage rates were low, it was possible to still buy these homes, but the combination of higher prices and higher mortgage interest rates has led to a decline in people willing and able to make a purchase.
While mortgage rates are predicted to drop eventually, it doesn't look like they'll come down in time to cause a Q4 rebound in the Charlotte area market. Instead, homes will continue to hold their price ranges, and the lower inventory level will keep prices higher for those who can buy homes during this time.
Until mortgage rates drop appreciably, it's not likely that Charlotte and the surrounding area will see an increase in homebuyers. Of course, once rates go down, the landscape of home buying in the area will change, but that will not significantly affect Q4, which is expected to remain very similar to Q3.
Growth Will Slow as 2024 Approaches
As the end of 2023 approaches, the growth of the housing market in the Charlotte, NC, region will continue to slow. Building permits for new housing developments, single-family homes, and multifamily options remain lower than they were toward the end of 2022 due to the rising costs of building materials.
Inflation is causing the market's growth to slow in several ways, and even once inflation levels out and stabilizes, prices for building materials are expected to remain higher. That's reducing the chances of building and remodeling, along with lowering the opportunities to buy homes.
The bottom line is that the Charlotte, NC, area is still an excellent place to purchase a home, with fair prices and reasonable inventory. But like many other places in the country, high mortgage interest rates and problems with ongoing inflation point to a cooling market in Q4 and beyond.