The number of homes for sale in Charlotte's red-hot real estate market keeps falling, but the inventory crunch isn't evenly distributed.
According to the Carolina Multiple Listing Services, the number of single-family houses for sale in the Charlotte region dropped 22.4 percent in April, compared with the same month in 2017. That helps explain why the real estate market can feel like a mad scramble, with multiple offers common and houses selling fast.
But the picture isn't so simple when you break down the numbers a bit.
If you're looking for million-dollar homes, there are almost as many on the market now as there were a year ago. Starter homes? They're practically an endangered species, with numbers plunging faster the farther down in price you go.
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The number of houses for sale that cost less than $120,000 in the Charlotte region fell by more than half, from 1,408 in April 2017 to just 673 in April this year. The next price levels, $120,001 to $150,000 and $150,001 to $190,000, fell almost as much, each dropping by nearly half.
That means the number of houses costing less than $190,0000 fell by about half in a year, placing intense pressure on buyers looking for starter homes. The number of homes from that price up to $350,000 dropped by about 20 percent.
"$350,000 and below, that's where we're seeing the multiple offer situations," said Jason Gentry, managing broker of Sotheby’s Lake Norman office and president of the Charlotte Regional Realtor Association. "It's supply and demand."
At the same time, the number of houses priced at more than $1 million fell just 3.2 percent, from 559 last year to 541 this April. The number of homes costing $500,001 to $999,999 hasn't fallen much more, declining by 7.3 percent to 1,603 properties.
Those pricier homes take longer to sell for a number of reasons, Gentry said. There are fewer buyers who want 6,000-square-foot houses in the suburbs than there were, and many of those on the market are older and need renovations.
What accounts for the decline in starter homes? A few factors could be at work.
Wall Street-backed institutional investors who buy homes and turn them into rentals, such as American Homes 4 Rent and Tricon, have focused their firepower on low-priced homes they can snap up quickly.
With land and labor costs rising, developers are also building more high-priced homes, replenishing those much faster than the supply of starter homes. Also, as market pressures push prices up, more houses are likely being lifted from lower-priced to higher-priced brackets.
All of that adds up to ongoing struggles for people seeking lower-priced homes in Charlotte, such as first-time and lower-income buyers. And until more houses hit the market, those trends are likely to continue.