North Carolina’s two largest cities — Charlotte and Raleigh — are home to the “hottest” housing markets for 2018, according to a new prediction from residential real estate site Zillow.
Both housing markets ranked among the top five on Zillow’s list of the nation’s hottest during the current year. Raleigh placed at No. 2, while Charlotte landed at No. 4.
In order to compile the rankings, Zillow measured six components for the 50 largest U.S. metro areas. That includes weighing home value and rent forecasts, income estimates, population growth, current unemployment rates and job opening data from Glassdoor to create a “hotness” score.
Western housing markets and tech hubs largely dominated the list. San Jose, Calif., had the “hottest” projected market, while Seattle ranked third and San Francisco ranked fifth. Austin, Texas; Denver; Nashville, Tenn.; Portland, Ore.; and Dallas rounded out the top 10 markets.
“This list shows that just because a market is smaller or more affordable doesn’t mean it isn’t dynamic,” said Aaron Terrazas, Zillow senior economist, in a statement. “Growing cities in the Sun Belt, places like Raleigh, Charlotte and Nashville, offer plenty of opportunities in health care and finance, while providing a less-expensive, but still-convenient, alternative to the larger and pricier markets in the Northeast.”
In Charlotte, as is the case with Raleigh and seven of the other top markets, home values are expected to increase at a higher rate than the national forecast of 3.2%. Charlotte is expected to see a 4% increase in home values in 2018, compared to a 3.7% increase for Raleigh. Meanwhile, rents should climb 1.9% in Charlotte and 1.2% in Raleigh, says Zillow.
Charlotte’s expected income growth of 9.4% — from a household estimate of $59,979 — registered as the highest of the top 10 markets ranked by Zillow. Raleigh trailed closely with a projected rise in income of 9%. Its recent household income was estimated at $71,685.
Raleigh’s population growth of 2.3% from 2015-16 slightly outpaced Charlotte’s 2% rate.
Both unemployment rates were also somewhat similar: 3.6% in Raleigh and 3.9% in Charlotte. Raleigh has 29,136 online job postings compared to Charlotte’s 49,736.
This is the second time in as many months that high expectations have been placed on the Queen City’s housing market in 2018.
In November, Realtor.com ranked Charlotte seventh for forecasted sales and price growth this year. It projected Charlotte will see a nearly 6% increase in sales and and a 3.02% uptick in prices over the year.
A seller’s market persisted across the Charlotte area in 2017, with housing inventory dropping to a 2.3-month supply — or 9,024 properties — at the end of November, prices rising and sales fluctuating throughout the year, according to the latest Carolina Multiple Listing Services figures.
Roger Parham, who served as 2017 president of the Charlotte Regional Realtor Association, said last fall that he didn’t expect a balance to return in the local market for another couple of years.
By Jenna Martin – Associate Editor/Online, Charlotte Business Journal