Apartment vacancy rate climbs to 6.7 percent in Charlotte

Charlotte’s apartment vacancy rate increased to 6.7 percent over the past six months as more apartments from a record building boom hit the market, according to a report Tuesday from market-tracking firm Real Data.

The pace of new apartment construction remains at a record high, with 10,463 units being built and a similar number planned, Real Data said.

That could drive the vacancy rate up to 8 percent and cause rent growth to slow, Real Data said. But that would still be well below the 13.6 percent vacancy rate in 2010, as the recession’s effects rippled through the region. Real Data’s report called the current vacancy rate “healthy.”

The average rent for an apartment in Charlotte crept up 0.5 percent, to $938. Over the past year, rent is up 3.1 percent.

Most of the new construction underway consists of upscale apartment complexes in uptown or close-in neighborhoods, such as South End, SouthPark, NoDa and Elizabeth.

In Real Data’s new report, uptown had the highest vacancy rate, at 14.1 percent. The center city also had the highest average rent, at $1,649.

The higher vacancy rate hasn’t deterred developers: In addition to the half-dozen complexes under construction, Greystar and Childress Klein are planning two uptown high rises with about 700 units, Crescent is planning 450 apartments and a Whole Foods, Levine Properties plans to build a 264-unit apartment building on 10th Street, Grubb Properties plans to build a second SkyHouse tower with more than 300 apartments, and Dominion Realty Partners said Monday it’s planning to build 300 apartments next to Gateway Village.

The city’s lowest vacancy rate is in the Northeast-1 submarket, which covers an area roughly between Interstate 77 and North Tryon Street, north of uptown to Sugar Creek Road. That area’s apartment vacancy rate is 2.9 percent, with an average rent of $639.

This story was originally published March 10, 2015 at 11:41 AM with the headline "Apartment vacancy rate climbs to 6.7 percent in Charlotte."