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U.S Department of Housing and Urban Development

Spotlight on the Housing Market

in the Charlotte-Concord-Gastonia,
NC-SC MSA
U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015

The Charlotte-Concord-Gastonia, NC-SC Metropolitan Statistical Area (Charlotte MSA) includes 7 counties located in south-central North
Carolina and 3 counties in north-central South Carolina. The initial downturn from the foreclosure crisis in the Charlotte MSA was less severe
than in some areas of the country but the subsequent recession had a larger impact than for the nation overall. Home prices appreciated
60 percentage points less than the national rate during the housing bubble, and the ensuing decline in prices was also less steep—16
percent compared with a national decline of 32 percent. Lower property values and the extent of underwater mortgages in Charlotte were
driven in part by investor speculation, unsustainable mortgage lending, and excess housing construction going into the crisis, but the rise in
unemployment and underemployment during the recession primarily fueled the rise in defaults and the decline in property values. The share
of mortgages at risk of foreclosure (those 90 or more days delinquent or in the foreclosure process) peaked the same year as the nation—but
at a somewhat lower rate. Nearly five years of fairly rapid job growth, state legislation that curtailed foreclosure actions, and the local use of
the Administration’s mortgage assistance programs has reduced the share of distressed mortgages in Charlotte. The Administration’s broad
approach to stabilizing the housing market has been a real help to homeowners in Charlotte and the surrounding area. This addendum
to the Obama Administration’s Housing Scorecard provides a summary of local economic trends and conditions and the impact of the
Administration’s efforts to stabilize the housing market and help local homeowners.

Population Growth, Employment,
and Housing Market:

With more than 2.2 million people according to the most
recent Census, the Charlotte MSA is the 22nd largest in
the nation. From 2000 to 2010, Charlotte’s population
increased by an average of 49,950 people, or 2.9 percent,
a year. An average of approximately 35,300 people per
year moved to the Charlotte MSA during the last decade,
accounting for 70 percent of the population growth during
this period. Natural population growth (births minus
deaths) accounted for the remaining 30 percent of the net
population increase. The highest influx of people moving
to the area—an average of 51,950 annually—occurred
between the years 2005 and 2008.
Charlotte MSA Housing Unit Growth Outpaced Population and
Household Growth During the Past Decade
Date of Census

4/1/2000

4/1/2010

Charlotte MSA Population

1,717,372

2,217,012

Annual Growth Rate

—

Annual Growth Rate

2.9%

510,516

Charlotte MSA Households

671,229

—

Annual Growth Rate
Source: Census Bureau (2000 and 2010 Decennial)

3.1%

546,447

737,775

—

Charlotte MSA Housing Units

3.5%

During the decade spanned by the Census, new housing
construction grew faster than household growth in Charlotte. Net
annual housing unit growth of 3.5 percent in the Charlotte metropolitan area
during the last decade was greater than the corresponding population and
household growth rates of 2.9 and 3.1 percent, respectively. The rate of increase
in vacant units in the Charlotte metro area during the 2000s was considerably
higher than the national rate, with vacant units increasing at an average annual
rate of 8.5 percent compared with 4.4 percent nationally, according to the
Census Bureau. Investor speculation had some effect on overbuilding in the
years leading up to the housing crisis, with the increase in the share of investor
purchases similar to the national upturn. Specifically, from 2000 to 2005,
investor home sales rose from 6.7 to 13.4 percent of total sales in the Charlotte
metro area, while the corresponding increase for the nation was from 8.2 to
14.8 percent. Subprime lending also had an impact on the overbuilding. A
study by the National Bureau of Economic Research indicates that the Charlotte
MSA ranked 68th out of the top 107 metropolitan areas with the highest share
of subprime originations during 2005, with subprime originations as a share of
new mortgages at 17 percent in Charlotte. A conservative estimate based on
HMDA (Home Mortgage Disclosure Act) data indicates that high-cost (proxy for
subprime) originations tripled nationally between 1998 and 2005, while a study
by the Center for Responsible Lending estimates that approximately 90 percent
of subprime mortgages during that period faced increases in monthly payments
of 30 to 50 percent within a few years, causing borrowers with subprime loans
to typically default at more than 7 times the rate of other mortgages.

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 1

U.S Department of Housing and Urban Development

U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015
Charlotte’s economy has improved. The local
economy was growing moderately before it began to
decline in 2008. From the second quarter of 2003 through
the second quarter of 2008, jobs increased at an average
annual rate of 2.5 percent, compared with a national
increase of 1.1 percent during this period. The impact of
the Great Recession was more severe for the Charlotte
metropolitan area than it was for the nation. Jobs in the MSA
declined at an annual rate of 5.0 percent from the third
quarter of 2008 through the first quarter of 2010, compared
with a national decline of 3.3 percent. The recovery from
the recession has been stronger for Charlotte than nationally,
however, with jobs increasing at an annual rate of 3.1 percent
from the second quarter of 2010 through the first quarter of
2015, compared with a 1.7-percent increase nationally.
The Charlotte MSA is headquarters to the Wachovia and Bank
of America Corporations and the second largest banking
center in the nation, with area banks controlling more than
$2.2 trillion in assets. Despite the presence of large banking
institutions, the financial activities sector only accounts for
8 percent of total nonfarm payrolls, a share that remained
consistent from the first quarter of 2003 through the first quarter
of 2015. During the recent recession, a period when every
other private sector in the MSA lost jobs, the education and
health services sector expanded at an average annual rate of
2.2 percent and the government sector by 3.5 percent. Job
losses were most severe during this period in the construction
sector, where jobs declined at an annual rate of 18.7 percent
and accounted for 24 percent of the loss in employment.
Job losses were also fairly substantial for the manufacturing
sector (-10.9 percent), other services sector (-8.5 percent), and
wholesale trade (-7.1 percent). The recovery from the recession
has been led by the professional and business services sector
(5.2 percent), leisure and hospitality (4.7 percent), and other
services (4.3 percent). The unemployment rate for the Charlotte
MSA peaked at 12.6 percent in December 2009 and, as
of June 2015, has fallen to 5.5 percent. In comparison, the
unemployment rate for the nation peaked in October 2009
at 10.0 percent and fell to 5.3 percent by June 2015.
Home sales in Charlotte have improved. After
peaking at 55,800 units sold in 2006, purchases of
previously owned (existing) homes in the Charlotte MSA
declined between 2007 and 2011 by an average annual
rate of 12 percent. Existing home sales have risen since
2011 by an annual rate of 23 percent, although the pace
slowed to 6 percent growth in 2014. By comparison, existing
home sales in the nation peaked in 2005 and declined by
an annual rate of 14 percent between 2006 and 2008.
Existing home sales began to rise again nationally in 2009,

increasing at an annual rate of almost 5 percent from 2009 to 2013, but slowed
in 2014, declining by 3 percent. Purchases of new home sales peaked in 2006
at 23,900 units in the Charlotte MSA before falling from 2007 through 2011 at
an annual rate of 15 percent. New home sales reversed that trend, increasing
at an annual rate of 17 percent (albeit on a low base) from 2012 to 2014.
Nationally, new home sales peaked in 2005 before declining by an annual rate
of 13 percent from 2006 through 2011; sales have increased since at an annual
rate of 14 percent (also on a low base) from 2012 through 2014.

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 2

U.S Department of Housing and Urban Development

U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015
Charlotte experienced a relatively small house
price bubble during the housing crisis. The CoreLogic
repeat-sales house price index (HPI) shows that home prices
in the Charlotte MSA rose nearly 60 percentage points less
than for the rest of the nation during the housing bubble and
had a less pronounced decline of 16 percent from their peak
in July 2007 to their low in February 2011. The national
peak-to-low decline was 32 percent (from April 2006 to
March 2011). Investor speculation had some impact on
the rise in home prices in the Charlotte MSA, with sales to
investors averaging 12 percent during the bubble, but lower
than the 13 percent share nationally. As described earlier,
subprime lending was also a factor in fueling home prices
in Charlotte. Since reaching their low point, home prices
in the Charlotte metropolitan area have risen 29 percent,
compared to the 35 percent low-to-current increase for the
nation, and have surpassed their previous peak in mid-2007.
The apartment vacancy rate in Charlotte has
remained above the national rate during the
past year. According to MPF Research, the Charlotte
MSA apartment vacancy rate was 5.4 percent in the first
quarter of 2015, up slightly from 5.3 percent a year earlier,
representing generally balanced market conditions. The
slight uptick in the vacancy rate occurred with the completion
of a large number of new apartment projects during the past
year, but strong demand in the city of Charlotte helped offset
the elevated supply levels. The national apartment vacancy
rate was 4.5 percent during the same period, down from
5.0 percent a year earlier. In the first quarter of 2015, the
average apartment rent in the Charlotte metro increased
5.5 percent from a year earlier to $917, compared with
a nationwide increase of 5.0 percent to $1,186. Overall
rental market conditions in Charlotte remain slightly softer
than the apartment market due to a high number of vacant
single-family rental properties. According to the CPS/
HVS (Current Population Survey/Housing Vacancy Survey)
conducted by the Census Bureau, the overall rental vacancy
rate in the first quarter for the Charlotte MSA was 7.4
percent compared to a national rate of 7.1 percent. The
2013 ACS (American Community Survey) indicates that
single-family homes accounted for 41 percent of all rental
units in the Charlotte metropolitan area, while representing
35 percent of all rental units in the nation.

Trends in Mortgage Delinquencies
and Foreclosures:
The share of distressed mortgages in Charlotte
has declined and is below the national level. As
of May 2015, the Charlotte MSA placed 216th out of

381 metropolitan areas ranked by share of mortgages at risk of foreclosure
(90 or more days delinquent or in the foreclosure process) according to Black
Knight Financial Services, Inc. From the end of 2001 through the middle of
2007, the share of distressed mortgages in Charlotte was consistently above
the national rate but rose less steeply during the foreclosure crisis, according
to CoreLogic data. In 2007 and 2008, when the foreclosure crisis began and
single-family foreclosures were largely driven by unaffordable non-traditional
loan products, the increase in mortgages at risk of foreclosure in the Charlotte
MSA began to rise, but at less than half the pace nationally. Specifically, from
the beginning of 2007 to the end of 2008, the share of distressed mortgages in
Charlotte increased 1.3 percentage points (from 2.1 to 3.4 percent), compared
with a national increase of 2.9 percentage points (from 1.6 to 4.5 percent).
Beginning in 2009, foreclosures were increasingly driven by loss of income,
unemployment, and strategic defaults as the economy worsened, according to
research by the Federal Reserve Bank of Chicago. A sharp spike upward in the
share of distressed mortgages occurred in 2009 for both the Charlotte MSA and
the nation. By early 2010, mortgages at risk of foreclosure reached a peak of
8.0 percent nationally and 6.9 percent in Charlotte. Although initially declining
from this peak, the share of distressed mortgages in Charlotte began to increase
again in 2011 and nearly reached the national rate. Passage of legislation in
2010 that allowed for foreclosure mediation in an effort to prevent foreclosures
likely contributed to this increase of mortgages in the foreclosure pipeline. The
current decline in the share of mortgages at risk of foreclosure in Charlotte is

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 3

U.S Department of Housing and Urban Development

U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015
again similar to the national trend. In Charlotte, the share
of distressed mortgages is now at 2.8 percent compared
to 3.3 percent nationally. Over the last year, the number of
distressed mortgages decreased by 24 percent—from 9,975
to 7,600—compared with a national decline of 27 percent
over the same period. A partial explanation for a lower
share of distressed mortgages in the Charlotte MSA relative
to the nation is a significantly lower foreclosure processing
timeline. As of the first quarter of 2015, the average time
to complete a foreclosure in the nation was 620 days
compared with an average of 243 days for North Carolina
and 542 days for South Carolina.
RealtyTrac data show the rate of foreclosure
completions in Charlotte has been slightly above
the national rate since April 2009. From April 2009
through May 2015, the number of foreclosure completions
as a percentage of all housing units was 3.4 percent in
Charlotte, slightly higher than the 3.2-percent rate for
the nation. Foreclosure completions have generally been
trending downward in the Charlotte MSA since 2013.
During the first quarter of 2015, the Charlotte metropolitan
area had a foreclosure completion rate of 0.6 percent, the
same as the national average during that period. Foreclosure
completions were 17 percent below their rate a year earlier
in Charlotte, although the rate was higher for both Charlotte
and the nation than in the fourth quarter of 2014. With
rising home prices and low inventories of homes for sale,
lenders are resolving defaults more quickly, which has led to
an increase in foreclosure filings.
The efforts of numerous state and local entities
and financial institutions in partnership with the
federal government have helped contain the
rate of foreclosures. In August 2007, North Carolina
Governor Michael Easley signed Senate Bill 1264/House
Bill 1374, which provides protections for homeowners in
the foreclosure process, including protection from loan
servicing abuses, and more rights to information during the
foreclosure process. The law also facilitates legal action
by the borrower if the lender fails to comply with the law.
The Emergency Program to Reduce Home Foreclosures Act
(Senate Bill 2115/House Bill 2742), which was signed in
Foreclosure Completion Rates in the Charlotte MSA
First Quarter 2015
Area
Charlotte MSA
Nation

Foreclosure
Completions

Foreclosure
Rate

Since April 1, 2009
Foreclosure
Completions

Foreclosure
Rate

570

0.06%

31,990

3.4%

82,100

0.06%

4,194,700

3.2%

Notes: Foreclosure rates as percent of all housing units. Data through May 2015
for foreclosures since April 2009.
Sources: Realty Trac and Census Bureau.

2008 and extended in 2010, requires lenders to give prior notice of foreclosure
to borrowers with subprime loans in an effort to reach an agreement that avoids
foreclosure; the law also provides funds to nonprofit counseling agencies to
assist borrowers. Through these and the Administration’s efforts, conditions in
the Charlotte MSA have improved. As of the first quarter of 2015, 6.3 percent
of mortgages in the Charlotte MSA remain underwater, down from 8.6 percent
a year earlier, according to CoreLogic. This compares to a 10.2 percent share
of underwater borrowers (those who owe more on their mortgage than the value
of their home) for the first quarter at the national level.

The Administration’s Efforts To Stabilize the
Charlotte MSA Housing Market:

The Administration’s mortgage and neighborhood assistance programs—the
Home Affordable Modification Program (HAMP, which is part of the broader
Making Home Affordable program), the Federal Housing Administration (FHA)
mortgage assistance programs, the Neighborhood Stabilization Program (NSP),
and the Hardest Hit Fund (HHF) program—combined with assistance from
the HOPE Now Alliance of mortgage servicers and the National Mortgage
Servicing Settlement have helped stabilize the Charlotte MSA housing market.
From the launch of the Administration’s assistance programs in April 2009
through the end of June 2015, more than 81,000 homeowners have received
mortgage assistance in the Charlotte metropolitan area. Nearly 45,800
interventions were completed through the HAMP and FHA loss mitigation and
early delinquency intervention programs. An estimated additional 35,200
proprietary mortgage modifications have been made through HOPE Now
Alliance servicers. While some homeowners may have received help from more
than one program, the number of times assistance has been provided in the
Charlotte metropolitan area is two and one-half times the number of foreclosures
completed during this period (32,300).
Under the landmark National Mortgage Servicing Settlement signed in February
2012, more than 9,843 North Carolina homeowners and more than 6,485
South Carolina homeowners have benefitted from over $400 million and
over $300 million, respectively, in refinancing, short sales and completed or
trial loan modifications, including principal reduction on first and second lien
mortgages provided as of June 30, 2013. Nationwide, the settlement has

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 4

U.S Department of Housing and Urban Development

U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015
provided more than $50 billion in consumer relief benefits
to more than 631,000 families. That is in addition to the
$2.5 billion in payments to participating states and $1.5
billion in direct payments to borrowers who were improperly
foreclosed upon between 2008 and 2011.
Given over three rounds, the Neighborhood Stabilization
Program has invested $7 billion nationwide to help
localities work with non-profits and community development
corporations to turn tens of thousands of abandoned
and foreclosed homes that lower property values into
homeownership opportunities and the affordable rental
housing that communities need.
NSP1 funds were granted to all states and selected local
governments on a formula basis under Division B, Title III of
the Housing and Economic Recovery Act (HERA) of 2008;
NSP2 funds authorized under the American Recovery and
Reinvestment Act (the Recovery Act) of 2009 provided grants
to states, local governments, nonprofits and a consortium of
nonprofit entities on a competitive basis; and NSP3 funds
authorized under the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010 provided neighborhood
stabilization grants to all states and select governments on a
formula basis.
Overall, a total of $5.4 million in NSP funds has been
awarded directly to the City of Charlotte, NC. In
addition, NSP funding in the amounts of $57.3 million
and $50.3 million was awarded to the States of North
Carolina and South Carolina, respectively. Of the NSP
grant to North Carolina, $2.6 million was sub-allocated to
the City of Charlotte; except for this one grant, data are not
yet available on the amounts of NSP grants to North and
South Carolina that were reallocated to the Charlotte MSA.
Approximately 458 households in the MSA have benefited
from the NSP funding to the City of Charlotte described
above. Data on households benefiting from NSP funds
reallocated to the entire Charlotte metro area from North
and South Carolina are currently unavailable.
As part of the State of North Carolina’s housing recovery
efforts, the North Carolina Foreclosure Prevention
Fund program was launched to help North Carolina
homeowners who are at high risk of default or foreclosure.
Charlotte MSA Housing Units to Date Benefiting
From NSP by Type of Activity
Construction or Rehabilitation
Homeownership Assistance to Low- and Moderate-Income
Total Housing Units

442
16
458

Notes: These housing units are the result of NSP grants (either direct or indirect) to the
City of Charlotte, NC. Data on units resulting from NC and SC state subgrants to the
Charlotte MSA (other than to the City of Charlotte) are not available.

The North Carolina Foreclosure Prevention Fund is financed by $483 million from
the Administration’s Hardest Hit Fund and administered by the North Carolina
Housing Finance Agency. Assistance is provided through the following programs:
•	Mortgage Payment Program—Provides monthly mortgage payment
and reinstatement assistance on behalf of unemployed and other eligible
homeowners who are unable to afford their monthly mortgage payments.
Homeowners who are in job training/education programs may receive an
extended term of assistance. Standalone reinstatement assistance is available
for eligible homeowners who have regained employment and can afford their
monthly payment provided they can bring their mortgage current.
•	Second Mortgage Refinance Program—Provides assistance for the
extinguishment of second mortgages to reduce the homeowner’s monthly
mortgage payment and to facilitate a first mortgage refinance or HAMP
modification.
•	Modification Enabling Pilot Program—Provides funds to facilitate
modifications for eligible mortgages purchased in a distressed asset sale.
Principal reduction may be matched with non-program funds to facilitate a
mortgage modification.
As of March 31, 2015, the most recent quarter for which data are available,
the NC Foreclosure Prevention Fund had disbursed approximately $306 million
on behalf of an estimated 19,060 North Carolina homeowners. North Carolina
homeowners who believe they may be eligible for these programs should visit
www.ncforeclosurehelp.org.
As part of the State of South Carolina’s housing recovery efforts, the South
Carolina Homeownership and Employment Lending Program (SC
HELP) was launched in January 2011 to help South Carolina homeowners
who are at high risk of default or foreclosure. SC HELP is funded by $295
million from the Administration’s Hardest Hit Fund and administered by the
South Carolina State Housing Finance and Development Authority. Assistance is
provided through the following programs:
•	Monthly Payment Assistance Program—Provides monthly mortgage
payment assistance for unemployed and underemployed homeowners.

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 5

U.S Department of Housing and Urban Development

U.S. Department Efforts To Stabilize Development Office and Help American Homeowners
The Obama Administration’s of Housing and Urban the Housing |Marketof Policy Development and Research | July 2015
•	Direct Loan Assistance Program—Provides
reinstatement assistance, principal reduction, or
forbearance reduction/elimination for homeowners who
experienced a financial hardship but have regained the
ability to pay their mortgage.
•	Modification Assistance Program—Provides
principal reduction with a loan recast or modification to
achieve long-term affordability.

•	Property Disposition Assistance Program—Provides assistance to offset
relocation expenses incurred in conjunction with a short sale or deed-in-lieu.
•	Neighborhood Initiative Program—Prevents foreclosures through the
demolition, greening, and ongoing maintenance of vacant and abandoned
blighted residential properties.
As of March 31, 2015, the most recent quarter for which data are available,
the SC HELP had disbursed approximately $136 million on behalf of an
estimated 9,209 South Carolina homeowners. South Carolina homeowners who
believe they may be eligible for these programs should visit www.schelp.gov.

Spotlight on the Housing Market in the Charlotte-Concord-Gastonia, NC-SC MSA | Page 6


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