Disrupting the Charlotte Real Estate Market
Millennials (those between the ages of 18 and 34) are the next big Charlotte real estate market disruptors. This isn’t because they’re living in their parents’ basements but that they’re buying properties.
According to a report from the National Association of Realtors, Americans under the age of 37 already represent the largest share of home buyers, at 36%. Not only are millennials buying homes, they’re also more likely to invest in properties. How much more likely? A BiggerPockets.com report shows these millennials are 52% more likely than Generation Xers or Baby Boomers to buy multi-family properties.
These properties generate passive income and provide tangible assets. With an entrepreneur mindset linked with a sense of stability gives millennials alternatives to more traditional investments like the stock market or Social Security that have uncertain futures.
“Over the past two decades, the real estate market has outperformed the stock market by a factor of nearly 2 to 1,” states BiggerPockets.com.
However, a barrier to real estate investment may be the traditional market structure when it comes to lending. Low credit scores result in debt, which impacts their power to borrow. Debt — not being able to pay the minimum payment due may take away the power to save money. Without proper down payment, buying power is decreased.
Technology may be the answer. With increases in online banking as well as digital real estate tools like Zillow and Trulia, real estate investing is less a local matter. Millennials are entering hot markets from afar. Their doing so may, in turn, create job opportunities for property managers who can provide on-site support for tenants.
According to the U.S. Census Bureau, Charlotte saw a 53.1% owner-occupant unit rate from 2013-2017. The median value of owner-occupied housing units was $187,300. The median gross rent was $1,018. From 2010 to 2017, Charlotte grew by 16.8% from 731,424 to 859,035. Over the 2013-2017 period, almost 80% of people age 1+ reported living in the same house as they were one year ago.
By Sarah Kucharski with Reference Credit to Luke Babich, Bigger Pockets