Nashville, Charlotte, and
Where Else?
By Graham Summers
December 18, 2006
If you want feedback, start writing about real estate...
All in all I received over 40 e-mails regarding my first Charlotte essay.
Many of you wrote of friends and relatives who have recently relocated to Charlotte. Some were kind enough to mention other areas where real estate is still just beginning to take off.
Bill writes, “I live in Marvin, a community in Union County... We are considered to be south Charlotte. I am associated with a company named Sunbelt Development. The most recent property bought from the Roberts family went on sale last week and was sold out in one day.”
Richard echoes my sentiment: “I have been a real estate broker in the southeast for 22 years and have seen the ups and downs in different areas which are completely normal cycles that every area goes through. The idea that there could be a national real estate bubble is ludicrous. We moved to the Charlotte area from Atlanta in 1997 and love living and working here.”
Jim writes of Charlotte, “Real estate is staying affordable because supply is keeping up with demand. Everywhere you look, there are new housing developments. Despite the tremendous bout of building that has occurred in the last decade, there is still so much land available, even near downtown.”
And finally, Craig advertises, “My property is for sale... 1680 sq ft. 3 bd 2 bath, 2 car garage with a bonus room $145,000.”
This feedback echoes what we’ve been writing about in the past few weeks... that the theory of a nationwide real estate bubble is, at best, a gross oversimplification. The theorists tend to focus almost exclusively on particular areas of the US, namely New York, California, and Miami. But there is a lot more to U.S. real estate than these peak areas.
Think of it this way: 5.4 million people live in Miami and its surrounding areas. 8.2 million live in New York City. And some 7 million live in the San Francisco - San Jose - Oakland region. Combined, these three areas make up 20.6 million people.
The U.S. has a population of more than 300 million people.
Yes, 43% of all new private-sector jobs between 2001 and April 2005 were related to housing. And yes, a lot of people have been buying homes they can’t afford.
However, claiming there’s a nationwide real estate bubble while focusing on just a few regions is like claiming that all stocks will crash because two or three sectors are overbought.
Sure, there are general nationwide trends in capital: low interest rates, cheap mortgages, etc. However, every region has its own set of financial bolsters and constraints: property taxes, zoning limitations, bureaucracy, and the like. Because of this, some areas take longer to develop or explode than others.
I’m currently compiling a list of areas in the U.S. that are just entering the boom phase. So far I’m looking at:
Nashville, Tennesse
Charlotte, North Carolina
Greenville, South Carolina
Milwaukee, Wisconsin
North Dallas, Texas
The Plano-Frisco Region, Texas
I plan on visiting all of these in 2007. If you are in one of these areas or have contacts involved in real estate there, please e-mail me at: growthstockwire@gmail.com.
Also, if you know of another place I should add to this list, don’t hesitate to write. I’ll leave you with the following:
One reader wrote in to tell me that he recently purchased three duplexes and three single-family homes in High Point, North Carolina, using nothing but a home equity line of credit (HELOC) on a single rental property in Stockton, CA.
In other words, one property in California equals six properties in North Carolina.
Good investing,
Graham
