But the vacancy rate rose just 90 basis points during the last six months of that period, as job loss moderated. The vacancy for the metro area is expected to climb to 12% this year, a rise of 70 basis points, compared to an increase of 310 basis points in 2009.
After climbing nearly 700 basis points from the beginning of 2008 through the end of 2009, because of competition from the shadow market as well as rising job losses, vacancies in the Uptown market have begun to improve as more apartment leases are signed. The increase in rental activity has also affected vacancies and effective rental rates in the Carmel submarket in the southern part of the metropolitan area, according to M&M.
There were around 3,500 units under construction in the Charlotte metro area in first quarter 2010, an amount equal to 3.6% of existing rental units. These units are scheduled to be completed this year and next. Rental completions for this year will drop to 2,000 units. This drop in completions should help to moderate vacancy rates.
The state of the rental apartment market is a reflection of employment. Local employers are expected to add 8,000 workers to payrolls in the Charlotte area in 2010, a 1% increase in the workforce. Last year, employers laid off 47,700 workers.
In 2010, asking rents are expected to drop 1.8% to $747 per month and effective rents are expected to drop by 2.4% to $661 per month. Last year, asking and effective rents decreased by 4.6% and 5.4% respectively.
Transaction velocity declined by 60% during the 12 months ending March 31, 2010, following a decrease of 55% in the previous year. But in 2010, investment sales in the Charlotte market are expected to increase, because of the number of distressed properties on the market, among other factors.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
