Will Apartment Complexes destroy the Charleston Housing Market?

Currieproperty management

Sometimes the real estate market does you a favor, other times it cuts you down to size. A key component of downtown Charleston SC real estate, that also applies to every other place is the rental market factor. Thousands of new apartment units are under construction right now boasting months of free rent, dog washing stations, etc. what does this mean for local investors? Around 20 years when the pendulum swung hard and investors began buying downtown rental property for the equity appreciation instead of cash flow. At this time, many downtown rental property owners sold, and turned their profits towards North Charleston where cash flow was (is) still king. With a high demand and low supply the early 2000s made investors dreams come true. It was easy when ten applicants show up the first day your house hits Craig’s list ready to spend upwards of $1000 per bedroom on a rickety old house with power bills almost as high as the rent and rotten windows falling into the street. Enter Greystar, who in this example represents all the apartment builders whose heads were turned by the high demand and low supply Charleston SC rents. Hint: Greystar manages a half a million apartments worldwide. Greystar is actually a very interesting company that you can read more about their history by clicking: clicking multifamily residential apartments. The Greystars of the world see big opportunity in Charleston SC where population increase and lack of competition means big profits. In fact Charleston monthly lease rates at Greystar’s Midtown Elan eclipse even their highest rental property in Washington DC. So what does that mean for the little guy, who bought a couple of houses in downtown Charleston. Guess what buddy, your world just got way more competitive. Prospective tenants are showing up with high demands and lots of needs. Where is the parking? Why can’t I have my dog? How much is my power bill going to be? Why is there a giant hole in the floor? Basically tenants now have something they haven’t had for years in the Charleston market: options. When compared to other medium sized cities Charleston rents are exorbitantly high and historic homes are often poorly maintained. What’s not yet clear is how adding big corporate multifamily to the mix will effect home values. Our market has always been bolstered by high rents so when the sails are deflated by high rise competition, what that means is the pressure releases and prices come down. When will that happen and will the steady influx of newcomers prevent it from ever happening? That’s anyones guess but bolstering your self for a downturn while adding property to your portfolio is something best done with a good agent, and a good property manager. Email me for more insights and to hear about how my management style can give your property an edge: currie@me.com