The Undersupply Story

Charlotte’s inventory woes didn’t happen overnight. Pre-2020, we averaged 10k+ active listings. Then came the pandemic housing craze, and active listings plummeted to ~2,800 by 2022 – an absurdly low number for a metro of this size . New construction couldn’t keep up (thanks to supply chain snags and labor shortages), and homes were selling faster than David Tepper sells first round draft picks. Fast forward to 2024: inventory climbed back to about 3,200 listings . Better, yes, but still way below what a traditionally healthy market requires. For context, many housing experts consider ~6 months of supply balanced; Charlotte sits around 1.6 months today.

That’s an extreme seller’s market by definition.

Why Tight Supply = Opportunity

It sounds counterintuitive, but low inventory can be good for investors. Fewer listings mean less competition when you put a property up for rent or sale – demand is basically built in. With so many buyers chasing so few homes, prices have been resilient. Even as the market “cools,” undersupply props up values. For a buy-and-hold investor, that steady or rising equity is gold. Plus, renters who are facing limited home purchase options will end up staying in the rental pool longer, boosting rental demand for your units. The key is finding deals in this tight market.

How?

Look OFF-MARKET for the motivated seller, the “ugliest house on the block” needing TLC; or, expand your search radius to outlying counties where inventory is improving faster (think Gaston and Cabarrus). Those who think outside Mecklenburg County can still find reasonably priced properties amid the crunch, especially if they’re willing to engage directly with a potential seller.

Overhyped Areas vs. Hidden Opportunities

In an inventory squeeze, everyone flocks to the same hotspots – South End condos, Ballantyne townhomes, you name it. The result? Those areas get picked clean and bid up. As a contrarian play, consider less obvious locales. Is that McMansion out in Monroe sitting longer than usual? Perhaps an opportunity to snag it below market pricing. Or maybe a fixer-upper in West Charlotte that scared off retail buyers could be your diamond in the rough. Maybe you drive around a neighborhood you’re interested in and talk to neighbors who may have insight on potential opportunities. In a market where everything seems in short supply, the real strategy is to target segments that are a little less picked over. We’ve noticed luxury-tier homes ($1M+) actually have more inventory nowadays (owners in this bracket aren’t as desperate to sell fast). If you have the capital, negotiating on a high-end property could yield a discount and a big long-term upside once supply normalizes.

Silver Linings and New Construction

Homebuilders know there’s money on the table and have been ramping up projects, especially in the suburbs. Drive through Union County or York County, and you’ll see new subdivisions popping up. This new construction is a welcome relief, gradually expanding supply. It’s still not enough to erase the deficit, but it’s a start. Also, keep an eye on built-to-rent communities sprouting around University City and elsewhere – they add rental supply, but not for-sale inventory, which keeps resale home supply tight. For investors, these new homes might present turnkey rental options with lower maintenance, albeit at a price premium. The inventory game in Charlotte is all about patience and creativity. The stock may be low, but the upside is high if you can secure a foothold now before the builders catch up in a few years.

Struggling with Charlotte’s low inventory? We’re here to help you find the hidden deals. Visit our website for off-market opportunities, follow us for weekly deal spotlights, or send us a message to get personalized tips on navigating this inventory crunch. Let’s turn this challenge into your competitive edge!