Thinking about Charlotte Rentals

15 Replies

Hi BP Community!

I'm a new investor based out of NY, looking for my first property. I've done some extensive top-down research on attractive cities for single-family or small multi-family (duplex, triplex) buy & hold rentals and Charlotte has come up consistently.

I'm looking to understand what would be a reasonable gross cap-rate to expect when investing in Charlotte given a budget of $150K - $250K. Using online data bases (such as Zillow, Trulia and Redfin) come across as unreliable or inconsistent in terms of evaluating comps.

Any areas I should be focusing on in particular? Charlotte seems very spread out in terms of neighborhoods and it's difficult to gauge rentals demand in this city as compared to some other metropolitan areas where public transportation is more prevalent.

Additionally, what are some good sources to find reliable input assumptions (rental rates, tax rates, vacancy rates, growth rates for rents and house prices) for modeling a deal?

Am I missing something in how I am thinking about my approach? If someone has a few minutes for a phone call, I would love to find some time to chat about your experience in the Charlotte market.

Thanks,

Alex

Hi Alex,

Honestly,

Charlotte's housing market is booming. If you're looking at properties on the MLS, the properties in decent neighborhoods will get snatched up in a few days. There aren't many multi_family housing opportunities available on the market that aren't in D neighborhoods and don't need a lot of work. Duplexes and Triplexes are low in inventory here. I know investors that buy in Gastonia, Kannapolis and single_family homes in Charlotte. If you don't like using Zillow and other sites for comps, contact a realtor and they can pull rental and sales comps for you. Good luck and I hope you're able to buy your first property soon!

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@Kenya Teague - Thanks for the perspective Kenya! Coming from NYC, I find the concept of renting a single-family home vs buying to own as a bit of a foreign concept, so I'm just trying to understand the psychology of the renter as to what they are looking for in Charlotte. I understand that the real estate market is booming in Charlotte given job opportunities and population growth, but are people actively renting (where) and is it easy to find tenants that stick around?

I don't have the capacity or experience to renovate a property so looking to buy something that will be in move-in ready condition/turnkey. Given your experience is that something that is doable on my budget?

Thank you for the insight!

Alex a great resource is Kevin Stringari with Bottom Line realty and management. He can help with all aspects in Charlotte 

@Jason Smith - Thanks for the referral Jason. I'll reach out to Kevin shortly. Have you worked with him before?

he's my current property manager for a duplex I have in Charlotte. He's a realtor, investor and property manager. So he can help with all aspects about investing. Best of luck!

The way Charlotte is growing is out similar to Atlanta.  The Center City is growing as well however, space is limited.  Larger companies are building and developing all over the Uptown Area.  Finding a multi unit close to the city is going to cost, the cape rate can still be very lucrative but it will cost.  

Investing in towns like Belmont, Harrisburg, Wax-haw, Concord, and other surrounding areas is where you are going to find a better cape rate.  Repairs may be needed to make any investment property rent ready.    Once again everything depends on the situation and the negotiated price and the numbers in the deal.   Charlotte has a lot to offer as far as real estate.  If you have any questions feel free to use me as a source I love talking about my City. 

@Nathan Fesnak - Thanks for the reply! I'm finding the surrounding towns like Harrisburg to be more appealing as well. College Downs also looks quite interesting. As I'm an out of state investor, I don't particularly have the capacity or experience to renovate properties. 

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@Alex Schukin let's connect to discuss what type of properties you're looking for. 

@Alex Schukin Hey Alex, I'm a REALTOR ®, Investor (buy and hold) and also own my own property management company.  You may also want to check into Cabarrus County which is NE of Charlotte.  Thats where I practice and reside and it is one of the 100 Fast Growing counties in the nation.  My hometown Kannapolis, is projected to double in population (from 47,000 to 95,000) by the year 2040.  Rental rates in this county are outstanding.  Would be glad to talk if you have interest.  

@Chris Puckett Just curious. Where did you get the stat on population growth in Kannapolis?

Hey @Scott Ryne , I'm on the Kannapolis Planning & Zoning board and it was a number a consultant has presented to us. We are currently updating our long range UDO so we are working with outside consultants on needs. It is based on number of homes being built, new down town development and several other factors.  

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