Data shows Triangle's housing markets may have cooled in June – except for renters

1 July 2022

RALEIGH – Though housing affordability in the Triangle worsened in recent months, the latest housing market sales data shows that housing prices may no longer be skyrocketing.

In Wake County, June had 1,807 closed home sales transactions in the residential market, with the median sale price of $474,900, according to data from Triangle Multiple Listing Service that was obtained by WRAL TechWire.

That’s a drop from the prior month, when the median price of residential property in Wake County was $485,000 on 2,332 transactions.

Still, homes are going under contract quickly.  In Wake County, the average home spends five days on the open market, the data showed.  That’s down from May 2022.

But there are other early signs that the market may be slowing.

Wake County real estate market sees a price pause – agents still predict prices will rise

What’s happening

For instance, in Durham County, across 508 residential transactions, the median sale price dipped below $400,000 in June 2022, according to the data from Triangle Multiple Listing Service obtained by WRAL TechWire.

That’s down from a median sale price across 570 properties in May 2022 of $424,250.

Buyers who are ready, willing, and able to make an offer on a property may be able to find a deal on a home that’s been listed on the market for more than two weeks, said Linda Craft, broker in charge and CEO of Linda Craft & Team, Realtors, in Raleigh, in an interview with WRAL TechWire this week.

“If a house has been for sale two weeks or more, the buyer will most likely not have to pay above asking price to win it,” said Craft.  “And, yes, may get a few dollars off or a little closing cost help.”

Of course, the data may also show a slowing that would be consistent with historical norms.  Take the historical data from Triangle Multiple Listing Service, TMLS.  In May 2019, the median sale price was $320,420 in Wake County, and the average days on market was 24.  But in June 2019, the median sale price dipped to $310,000, even though the average days on market dropped to 22.

In July 2019, the median sale price jumped back up to $317,000 in Wake County, TMLS data shows.

Home affordability takes another plunge in Raleigh – but buying demand remains strong, agents say

Buyers getting a deal?

That could be especially true this weekend, noted Craft, as holidays are usually very slow, based on historical performance.

But that also means that fewer homes are listed ahead of holidays, noted Craft, who said she expected more for sale listings after July 5.

And this week, mortgage interest rates dipped down to 5.7% on average for a 30-year fixed rate mortgage, according to the latest data from Freddie Mac, despite having nearly doubled from earlier this year and hitting an annual high the prior week when average rates were 5.81%.

So, for buyers who are already active in the marketplace, it could be a good time to lock in a home contract, and lock in an interest rate, given current market conditions.

While mortgage applications are down month-over-month, said said Jon DeHart, a local mortgage broker with Movement Mortgage, there are still people buying homes every day and the purchase mortgage business remains strong in the Triangle.

“Homes are priced correctly are still selling relatively quickly when compared to historical data, however not as quickly as in the beginning of the year,” said Jon DeHart, a local mortgage broker with Movement Mortgage.  “Homes now sell in weeks instead of days or less. There is a shortage of inventory in our market.”

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Rents still rising

But one area of housing markets that haven’t slowed?  The Triangle’s rental market.

In the Raleigh-Cary metropolitan statistical area, rental growth slowed compared to last year, but growth still remains, with rents increasing last month by 1.9% according to the latest data from Apartment List.  And median rental prices are up 31% since the onset of the COVID-19 pandemic in March 2020, the data shows.

What’s that mean in terms of price expectations?  The median price of a two-bedroom apartment is now $1,494, according to the Apartment List data, and $1,355 for a one-bedroom apartment.

In Durham County, rents rose 2.3% in the most recent month compared to the prior month of data, Apartment List found.  And rents are up 27.6% in the county from March 2020, with the median price of a two-bedroom apartment now $1,467 and a one-bedroom apartment at $1,222.

Triangle’s apartment crunch worsens – vacancy down, and price of rent jumps 20%

“It still comes down to supply and demand,” said Jim Allen, broker in charge of the Jim Allen Group, in an interview with WRAL TechWire this week.  “Demand is at an all time high and supply at an all time low.”

And, noted Allen, investors are still active in the Triangle, whether they’re looking to buy and hold the property and convert it into a rental property given the strong recent rent growth, or those who are looking to repair or renovate a property and resell it, which is called flipping.

“Investors will continue to purchase everything they can buy,” said Allen, noting that institutional investors, who are active in the Triangle, often aren’t as concerned about mortgage interest rates.

“Investors buy new to rent is at an all time high,” Allen also noted, adding that the time to build a new home has also increased in recent months due to supply chain shortages and a changing local labor market.  “Despite our best efforts to supply more new homes, we are still falling woefully short.”

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