Rents in Small Carolina Markets Fall Under Weight of New Supply

Three small apartment markets in the Carolinas are cutting rents under elevated supply volumes. From October to November, effective asking rents were cut roughly 1% to 3% in Charleston (-1.0%), Myrtle Beach (-2.7%) and Wilmington (-1.8%), according to data from RealPage Market Analytics. Those cuts were steeper than the national month-over-month average rate cut of 0.4%. On an annual basis, rents fell around 2% to 2.5% in Mrytle Beach (-2.2%) and Wilmington (-2.6%), while a mild year-over year decline was seen in Charleston (-0.1%). Nationally, rents rose an average of 0.4% year-over-year. All three of those Carolina markets have been witnessing an onslaught of new apartments, and supply has yet to peak. Myrtle Beach saw its inventory grow 10% in the year-ending 3rd quarter 2024, taking its existing unit count to roughly 53,300 units. Supply in that market is expected to peak in 4th quarter 2024, with the addition of 5,731 units expanding inventory 12.2% in calendar 2024. Charleston, with nearly 76,700 existing units, grew its inventory 4.8% in the year-ending 3rd quarter 2024. Supply in Charleston will likely peak in the year-ending 1st quarter 2025 with the addition of 6,024 units for an expansion rate of 8.3%. Wilmington, the smallest among those Carolina markets with around 30,400 existing units, added 2,704 units in the year-ending 3rd quarter 2024 for an expansion rate of 7.4%. New supply there is expected to peak in 3rd quarter 2025 with the addition of 2,441 units, growing existing stock 8.2%. That’s close to the market’s 7.4% expansion rate seen in 3rd quarter 2024.