Charlotte has been lucky as of late. While the rest of the country has been experiencing a real estate crisis comparable only to the times of the Great Depression, Charlotte has a strong real estate market. I know this first hand being a property owner in this beautiful southern city. Over the last five years, my property has increased in value a whopping 50%.
But this may be all about to change. Yesterday, one of this town’s largest employers, Wachovia, announced that its CEO has been fired by its board of directors. On the surface this doesn’t seem like a threat to the local real estate market. However, now insiders are saying that Wachovia poised for a takeover by another company. Should this occur, the expectation is that there will be massive layoffs. The effect this may have on the local economy in Charlotte could be staggering.
Charlotte is the second largest financial city in the United States, only behind New York City, which hosts the headquarters for such companies as Bank of America, Wachovia, LendingTree, and the former First Union Bank. Having this type of banking community also brings attorneys, consultants, IT experts, and a myriad of other professionals and service providers. Based on the backbone of the success of these companies in recent years, Charlotte has experience extreme growth. In the last four years alone, we have witnessed our uptown transform into a metropolitan center now with an NFL and NBA franchise firmly planted. A highly expensive light rail train system now services commuters in and out of the city. And countless of condo and urban developments have been constructed and are currently under construction based on this cities good fortune and promising real estate market.
With a Wachovia take over, this could be all about to change. Massive layoffs would result in a substantial exodus from the city. A flood of “for sale” signs will be placed on lawns and in the windows of condos. And as simple economics tells us when supply is up, prices come down.