The economy and its effects on Charlotte

[Charlotte_native]

I never said that wasn't the case. But with a population hanging around 9,000 as compared to one of 6,000 in 1990, it really isn't growing much. All of the proposals and dead projects that I mentioned above came into being with such statements, "oh there are going to be 25,000 people in the center city by 2010". Some were as high as 40,000 which is amazing.

So either, the real demand was never there or the economy has certainly sundered all these plans as it seems unlikely that downtown's population is going to change much over the next year or so. Like the other posts I made above, the numbers are pretty simple and are not really subject to opinion.

[monsoon]

Since I last posted in this topic the national corporations have announced over 1 million layoffs with 700,000 announced since Jan 5th. Today they announced the GDP of the USA is now falling and the national government has been fundamentally changed over where it has been over the last 3 decades. There is national anger at the CEOs of this country including the leaders of Charlotte's banks who are being described as irresponsible, greedy and responsible for a lot of the pain that people are feeling. This even comes from the President.

There are now widespread layoffs all over the Charlotte in many places that don't make the news. Some places are hitting 20% or more and there isn't any sign this is letting up. I am familiar with 3 manufacturing plants right on the outskirts of the county that have laid off people in the 100s just this week. Finally the local governments here in Mecklenburg are now facing the specter of falling property values, falling tax receipts, and not really any alternatives for raising more money. My guess is some of the "creative" financing schemes they got themselves involved in are going to come back and bit them hard. Another friend of mine is a real estate agent who used to specialize in downtown property. He finally had to take up another job as the income from that has essentially disappeared.

So my question is there anyone here who still thinks this is a normal business cycle and things are going to return to pre-2008 in 2010?

[RiverwoodCLT]

We have not seen all the fire works yet. It is only going to get worse. Who is going to fill all those big box stores that are being vacated by the companies going out of business or the business that are closing part of their stores like Starbucks

Charlotte may fair better than a lot of cities, but we will still feel pain.

[Charlotte_native]

So my question is there anyone here who still thinks this is a normal business cycle and things are going to return to pre-2008 in 2010?

[mad_park]

Does any one have numbers of how many high rise units are selling per month uptown? (not the townhouse type units over in 1st ward or 4th ward) The fact that they are taking 200+ units off the market seems to me like there is way too much supply. When are other large developments scheduled to go "on-line"?

[28202]

These and The Garrison are the only ones that can deliver this year. The Vue is 1.5 years out. I doubt anything tall could be completed earlier than those under way.

[mad_park]

Normal times also don't mean the free-for-all that led up to this for a couple or handful of years. That, too, was an extraordinary period that wasn't sustainable or part of what would be a 'normal' business or economic environment.

[Charlotte_native]

Does any one have numbers of how many high rise units are selling per month uptown? (not the townhouse type units over in 1st ward or 4th ward) The fact that they are taking 200+ units off the market seems to me like there is way too much supply. When are other large developments scheduled to go "on-line"?

[monsoon]

It's pretty clear that drop-off coincides almost exactly with the fall of the false economy we have had over the last 6-8 years.

[jms54]

It's pretty clear that drop-off coincides almost exactly with the fall of the false economy we have had over the last 6-8 years.

[Charlotte_native]

It's pretty clear that drop-off coincides almost exactly with the fall of the false economy we have had over the last 6-8 years.

[Charlotte_native]

The hardest hit of the markets we've been watching has been upper end homes all over. There is a massive glut of unsold $700,000+ homes in south Charlotte, the lake, and all over Dilworth and Myers Park.

Wilmore (not in that price range) has had 30+ homes on the market for almost a year with ONE sale (MLS).

Dilworth currently has 84 single family listings with some now under $300,000. Only 6 show up as under contract and they are all $400,000 or under with 2 at $525,000 and $599,000. Only 10 have been sold in the last 3 months.

Lake Norman in Mecklenburg County 81 - $1million + homes on the market right now with most being on the market for many months. There are only 6 under contract and only 3 have sold since November and they were on the market for 70, 260, and 365 days.

Times are tough all over for high end homes but you could probably steal one right now if you had the ability to close.

[monsoon]

I suspect some of these places may start selling once prices drop to the point to reflect their true value, and not value based on the highly leveraged real estate economy that has existed since 2000 or so. Unfortunately it means that recent purchasers will be the ones burnt by what went on.

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I am very concerned by the amount of money the federal government is going to borrow in another futile attempt to fix this problem. I still don't understand the mentality of attempting to fix an economy that was destroyed by too much credit, by going even deeper in the hole. It's basically transferring wealth from the future (generations) to fix the excesses of the past.

[Charlotte_native]

I am very concerned by the amount of money the federal government is going to borrow in another futile attempt to fix this problem.

[krazeeboi]

This is the first article I've seen about Charlotte on a national level this year. Not much in the way of substance, but that doesn't really surprise me.

[queensguy06]

^You beat me to it. I didn't know which topic to put that in, so it is also in the 'Charlotte's perception nationwide' topic. I stated over there that while there isn't anything really news wise to those of us living here, I do find it amusing that the article implies that Charlotte is hurting worse than many other places in the nation and citing this by the closing of Morton's and the Home Depot Design Center, as well as a slow down in consumer shopping in the SouthPark area. Oh yeah, and Capital Grille had a slow happy hour.

[krazeeboi]

Precisely. It's way too soon to tell how all of the upheavals in the banking industry will specifically affect us. Companies are shedding jobs everywhere, people are getting laid off everywhere, and businesses are closing everywhere. That writer needs to come back with some solid stats in tow. That was really some shoddy journalism.

[queensguy06]

Forbes.com has one of there "Top/Worst/Best/Least" articles about the worst residential vacancy rates in the country. They averaged the rental and the homeowner vacancy rates of the largest 75 metro areas (from fourth quarter) and Charlotte sits at 15th place with 14.7% rental vacancy and 3% homeowner vacancy, sharing that spot with Cincinnati. Other cities in the Southeast: Tampa #13, Miami #11, Jacksonville #9, Orlando #7, Greensboro #4, and Atlanta #3. Those of you in the residential business, I am curious to know what a "healthy" vacancy rate (both rental and homeowner) is considered to be in the current economy.

[atlrvr]

Barclays is shutting down EquiFirst, which is based here in Charlotte (Ballantyne area I think) and most all jobs will be lost. This is several hundred jobs.

[28202]

MSN is running a story from Forbes naming Charlotte as the third best city in terms of Real Estate Nationally.

Forbes Best & Worst Real Estate Markets

Glad to not be on the other list.

[Charlotte_native]

I've put this up before, but still think it is befitting, especially considering the couple posts above -- in a meeting late last year with some out of town investors considering buying, land banking, and overall doing some large real estate investments in the city their main guy called Charlotte 'The city that sucks the least'. Certainly not a Chamber of Commerce ready slogan, but it is pretty telling in the perspective of others and how bad it is elsewhere compared to here. That isn't to say it isn't bad here or everyone thinks things are flowers and picnics, but there are many places in the country suffering far worse than we are.

[Bikeguy]

At least on the face of it, it appears that the Wells folks have gotten a bit squeamish about having an association with big spending golf tournaments. Although they will abide by their contractural obligations, The Wachovia Open, is now simply The Quail Hollow Open.

[southslider]

"Case-Shiller doesn't take into account new construction or foreclosure sales," says Jonathan Miller, president of Miller Samuel, a Manhattan residential appraisal firm. "In some of these markets, I'm not sure how you can ignore new construction or foreclosures."

[Charlotte_native]

In in a high-growth market like Charlotte, I think this loophole is helping us look like we are "sucking the least." In other words, Charlotte may still be one of the better real estate markets nationally for established neigborhoods, but not its newer subdivisions or areas with disproportionate first-time homebuyers.

[tozmervo]

So there's a number floating around - 25% - to describe the number of architects that are now unemployed in the city.

I think that number is optimistic. There are offices that have shed north of 50% of their staff. I personally know of no office that hasn't had a round of layoffs or isn't on the verge of it. I don't think it will be much longer before some firms declare bankruptcy entirely.

Unlike past recessions in architecture, this one has hit (1) every geographic area and (2) every market segment. That means even firms that had diversified work across many fields, regions and nations are hurting, and hurting bad. Firms that were wholly vested in residential or commercial have been wiped out. Firms that were wholly vested in healthcare and institutional are struggling to stay afloat.

Basically, yes. The economy blows.