Rental Competitivity in North Carolina in 2022: Asheville Takes Lead, Despite Fastest Pace of Apartment Construction Statewide

• Asheville was North Carolina’s hottest market in 2022, despite its rapid pace of apartment construction.
• Fayetteville and Greenville — the state’s second and third most competitive rental markets — along with Charlotte saw the most significant shifts in competitivity in peak rental season.
• Most North Carolina markets saw more competition during peak rental season versus the first months of 2022.
• Surprisingly, Charlotte was the North Carolina market where it was easiest to rent an apartment this year.

With its mix of scenic natural landscapes, top-rated universities and growing business sectors, North Carolina is a sought-after destination for transplants from big coastal cities looking for a more affordable place to live. In addition, out-of-state students often decide to continue living here after graduation, primarily due to the region’s high job growth and diverse opportunities. All of these factors make cities in North Carolina magnets for renters. Accordingly, on average, 14 renters competed for the same vacant apartment in the state in 2022 and apartments were filled in about one month.

To see how rental competitivity changed throughout the year in each market in the Old North State, we looked at five important metrics based on Yardi Systems apartment data, including:

• the number of days rentals remained vacant
• the percentage of apartments occupied by renters
• the number of prospective renters competing for an apartment
• the percentage of renters who renewed their leases
• the share of new apartments completed

Based on these factors, we used a Rental Competitivity Index (RCI) to rate each rental market in the state during three different timeframes: the first part of the year (January to April), peak rental season (May to August) and the full year of 2022. The value of each RCI score showed if a market was highly competitive (90 points and above), competitive (between 45 and 90 points) or less competitive (less than 45 points).

Smaller markets were more competitive than major tech hubs

An affordable cost of living and dynamic job market made North Carolina a competitive state for renting in 2022. In fact, North Carolina had an RCI score of 63.9, significantly higher than the national benchmark score of 59.9.

Specifically, Asheville was North Carolina’s hottest market in 2022, followed by Fayetteville and Greenville. The metro’s stable job market — which is mostly based on healthcare and education — as well as a mix of cultural opportunities and vibrant creative communities continued to attract newcomers, particularly remote workers from neighboring states: More precisely, Virginia, Florida, South Carolina and New York are the main states that fueled North Carolina’s influx of new residents, according to the U.S. Census Bureau.

Furthermore, Asheville’s RCI score for the year was 117.2, which made it a highly competitive metro: It was the only North Carolina market to heat up as much as Miami; Grand Rapids, MI; or Orlando, FL — the nation’s top three hottest renting spots. The Asheville metro was America’s fourth most competitive small rental market in our overall ranking for the year.

With occupancy at a sky-high 97.4%; more than 70% of renters deciding to renew their leases; and no less than 23 renters competing for the same vacant unit, apartments for rent in Asheville filled in just three weeks, on average.

Notably, smaller markets with limited inventory like Asheville tend to heat up faster when dealing with high demand. And even though the supply of apartments grew by 5% this year — the most significant increase in all of North Carolina — renters still had very few options to choose from.

Meanwhile, Fayetteville ranked second statewide, boasting an RCI score of 83 — far behind Asheville. With 95.6% of apartments occupied and almost two-thirds of renters renewing their leases, competition was high in 2022. Here, no less than 15 people, on average, competed for the same vacant apartment. As a result, Fayetteville was the 18th most competitive small market in the nation this year.

Coming in third in North Carolina in terms of rental competitivity, Greenville’s RCI score was 74.9 in 2022. The metro’s apartment occupancy rate of 96.1% was above Fayetteville's, especially after more than 64% of renters renewed their leases. To make things even more challenging for apartment-seekers here, the supply of rentals only increased by 0.5%, thereby fueling competition in an already sizzling market.

Fayetteville and Greenville saw the most important changes in competitivity in 2022

Fayetteville and Greenville were North Carolina's second and third most competitive markets. Even so, it was easier to rent in peak rental season in both areas due to significant shifts in competitivity. For example, Fayetteville’s RCI score for the first part of the year was 94.3, making it a highly competitive metro in that particular timeframe, alongside Asheville.

With an occupancy rate of 96.2%, 17 prospective renters competed for the same vacant apartment. And with virtually no new units added to the market through April, it’s no surprise that the metro was supercharged in the first months of 2022. What's more, the lease renewal rate of 63.5% for the same period (versus 61.9% in rental season) only added more fuel to the fire.

Fortunately, finding an apartment for rent in Fayetteville was easier during peak rental season thanks to a 1.1% increase in new apartments, which offered renters more options. As a result, competitivity in the metro decreased by 11.2% in peak rental season, when it's RCI score was 83.8.

Greenville followed a similar trend in 2022, with less heat in peak rental season when 95.1% of apartments were occupied compared to 97.3% in the first part of the year (only Asheville saw a higher occupancy rate). Similarly, the number of renters competing for one unit was also lower during the summer months: 12 versus 17 in the first months of the year. The only North Carolina market with fewer prospective renters per unit in peak season — 11 people competing for one apartment — was The Triangle.

In addition, vacant apartments in Greenville stayed on the market for 28 days during peak rental season compared to 26 days in the first part of the year. At the same time, the number of renters who renewed their leases dipped slightly in peak rental season: 59.3% versus 59.8% in the first part of the year.

And, with no changes in the share of new apartments added in the area in 2022, it was easier to rent an apartment in Greenville in peak rental season. During this timeframe, this market's RCI dropped from 87.8 to 58.4 to make it nearly 34% less competitive.

For comparison, Asheville was nearly 8% hotter during peak rental season, when its RCI score was 112 (compared to 103.8 in the first part of the year). That was almost double the state’s RCI score of 62.8 for the same interval of time.

Also known as the Paris of the South, no less than 20 people competed for one vacant apartment in Asheville in rental season — a record for the state in 2022 — versus 17 in the first part of the year. Moreover, both occupancy and lease renewal rates were the highest in the state, despite not shifting significantly throughout 2022.

That said, apartments in Asheville stayed on the market for less than three weeks during peak rental season versus 27 days in the first four months of the year. Only apartments in Wilmington were filled in faster: 19 days in peak rental season and 25 days in the first part of 2022.

In Asheville, competitivity peaked during rental season, even though the metro’s 5% increase in new apartments through August was the highest increase in the state. This just wasn't enough to cool renting activity in this small market, which usually heats up faster than larger metros in the state.

The Research Triangle was the fifth most competitive market in North Carolina and one of the four areas in the state that got hotter during rental season. Top-notch universities and exciting tech jobs continued to attract renters in the area throughout 2022. For example, last year, Apple announced a $1 billion investment in North Carolina, including a new campus and engineering hub in the Research Triangle. In addition, Raleigh has maintained its major U.S. tech hub status for years now.

Even so, the 1.7% increase in new apartments through August did not affect competitivity in the Triangle. With nearly two-thirds of renters deciding to renew their leases and 95% of apartments already occupied, vacant apartments were filled after 26 days in peak rental season and 34 days in the first part of the year.

The Piedmont Triad came in sixth statewide in terms of rental competitivity, with an overall RCI score of 60.7. The area was hotter in the first part of the year when a little more than 95% of apartments were occupied and nearly 64% of renters renewed their leases. Then, both rates were slightly lower in peak rental season when competitivity decreased by 6.8%.

Charlotte’s tech appeal supercharged the market in peak rental season

Charlotte, the South’s growing tech hub, was hotter during rental season. Its RCI score increased by nearly 19% to 60.3 during that interval of time, despite the high share of new apartments added to the market — 2.5% through August versus 1.1% through April. Only Asheville and Wilmington saw a faster pace of apartment construction in North Carolina this year.

However, in 2022, Charlotte added more than 6,000 new units to its supply of apartments — more than smaller locations that topped our list. This helped take some pressure off the market and positioned the tech city at the bottom of our ranking of North Carolina's hottest rental markets.

Specifically, in peak rental season, the average vacant apartment in Charlotte stayed on the market for 29 days — one week less than during the off-season. Additionally, the yearly average for the metro was 32 days, the longest period in all of North Carolina’s markets.

Even so, Charlotte has been named one of the country’s top tech cities for years now and its booming economy has maintained high demand for rentals even throughout the pandemic. The metro was also ranked fifth in the U.S. for tech talent growth between 2016 and 2021 with a 22% boost, according to a report by CBRE.

Charlotte also came in sixth nationwide in CompTIA’s most recent Tech Town Index. The metro’s dynamic tech business environment, high incomes and good quality of life were the most sought-after incentives for top, out-of-state talent.

Methodology

RentCafe is a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the U.S.

To compile this report, RentCafe.com’s research team analyzed Yardi Systems apartment data across 135 rental markets in the U.S. The data comes directly from market-rate large-scale multifamily properties of 50 units and more. Fully affordable multifamily properties were excluded.

The markets were ranked based on a market competitivity score. To calculate each market’s score, we used five metrics and their averages for January through August 2022: apartment occupancy rate, average total days vacant, prospective renters per vacant unit, the renewal lease rate, and the share of new apartments completed in the first eight months of 2022 compared to the overall supply as of Dec. 31, 2021.

We then compiled an average ranking by assigning a percentage weight for each metric: 30% for apartment occupancy rate, 15% for average vacant days, 15% for prospective renters per vacant unit, 30% for renewal lease rate, and 10% for the share of new apartments.

"First part of the year" refers to the timeframe between January and April 2022 and "peak rental season" refers to the timeframe between May and August 2022.

In this study, the terms "market," "area" and "metro" are used interchangeably and are defined as Yardi Matrix markets.

The Charlotte market encompasses Charlotte, Concord and Gastonia.

The Piedmont Triad market encompasses Alamance, Davidson, Forsyth, Guilford and Randolph counties, with Greensboro and High Point as the main municipalities.

The Triangle market is made up of Raleigh, Durham, Cary, Chapel Hill, Morrisville, Carrboro, Apex, Garner, Knightdale, Wake Forest, Hillsborough and Clayton.

The Asheville market includes Buncombe, Haywood, Henderson, Madison and Transylvania counties.

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