Nearly every major housing market in the U.S. has seen home values drop in the last year. In some cities, such as Las Vegas, drop is putting it lightly. But there is one exception: North Carolina's largest city.

From member station WFAE in Charlotte, Scott Graf reports.

SCOTT GRAF: Every month this spring, Charlotte has had the unique designation of being the only one of the nation's 20 largest cities where home values have increased since last year. To understand why, you just need to visit two parts of town.

Our mini-tour would start here in Charlotte's downtown. It's early Saturday morning, but construction activity here is already very brisk. This part of town is already home to corporations like Bank of America and Wachovia. Other big employers around here include NASCAR and the trucking and warehousing industry. Other economies across the U.S. are cutting jobs, but office space here in Charlotte can't seem to be built fast enough.

(Soundbite of machinery)

The other part of this city's story can be told from here, a quiet neighborhood in one of Charlotte's northern suburbs. This subdivision is a mix of single-family and town homes that surround a classic-style town square. Places like this have popped up across the region, and they're filling up with transplants like Pat Riley.

Mr. PATRICK C. RILEY (Allen Tate Company): If you look around America and say, where can I put a stickpin that I'm going to have low residential real estate taxes, a lot of home for the money, quality of life, and then you just sprinkle on top medical and higher education and climate and mountains and beaches - it's magical.

GRAF: If that sounds like a Chamber of Commerce ad, that's because it kind of is. Pat Riley chairs the Charlotte Chamber and is president of the Carolinas' largest real estate firm. About 1.7 million people live in the region. Last year, 70,000 people moved here and 35,000 new jobs were added. Wachovia senior economist Mark Vitner says that growth has kept demand for housing high.

Mr. MARK VITNER (Senior Economist, Wachovia): When you look at places like Charlotte, the supply curve is very elastic. So there really aren't the supply constraints that exist in other markets.

GRAF: Plenty of land has meant the region didn't have the tremendous run-up in prices that occurred in many other markets. With a lack of a so-called real estate bubble, there's been no bubble to burst. Instead, increases in Charlotte's home values have been slow and steady.

Mr. PHIL EVANS (Graphic Designer): We feel very fortunate to be in Charlotte, where things have held up so well.

GRAF: Graphic designer Phil Evans works from his 2,600-square-foot, two-story home. He takes a break on a front porch that's full of plants, rocking chairs and ceiling fans. Evans estimates his home is worth 20 percent more today than when he bought it eight years ago. But only about 1 percent of that increase has come in the last year. That's not much, but in places like Miami, Phoenix and Las Vegas, homes have lost about a quarter of their value in the same amount of time.

Mr. EVANS: I certainly don't take anything for granted, and I don't think this market is bulletproof at all. And I think we're kind of holding our breath, hoping that things hold out well here.

GRAF: Though Charlotte has been fortunate lately, the local market is not perfect. Demand has dropped as people in other parts of the country have had difficulty selling their homes and then buying ones here. In fact, economists say this region might join the many other cities where home values are declining. But they expect any downturn in this area would be minimal and short-lived.

For NPR News, I'm Scott Graf in Charlotte.

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