Raleigh Housing Update for September 2024

[Benjamin Carver]

Hello! Quick Raleigh Housing Market Update for September: I put this together so you can stay in the loop if you're looking to invest or house hack this year. Info pulled off MLS directly.

Main Message Here: Winter is coming! As October rolls in, the weather is cooling and real estate continues to do so as well. Buyers get more leverage. (Home Prices Chart for Wake County:https://tmls.stats.10kresearch.com/infoserv/s-v1/IFT9-D07)

Here’s Where We’re At Today

The Median Home Price in Wake County is $471,000 for all real estate, down 2% from last month and about where we were this time last year. Now, let's break that down…

- A median single family home is $543,000 (up 2% from last year)

- A median townhome is $377,000 (Down 5% from last month so appreciation has slowed down significantly here: https://tmls.stats.10kresearch.com/infoserv/s-v1/IFbq-ZfR)

More quick stats:

- Homes went for 1% under asking, indicative of a less competitive market typical of fall

- ⅓ of homes experienced at least one price drop

- Homes sat about 21 days on market

- Sellers has 10 showings before going pending

- There are about 3,100 homes for sale, which is up 10% over last year

We continue to see more options to choose from, more flexibility from sellers, and cyclical dips in prices across the board.

BIG NEWS in the Real Estate World

If you haven’t heard….

“The [Fed] cut amounts to a declaration of victory over inflation, which has come down from a peak of 9.1% in June 2022 to 2.5% last month. The Fed signaled that it will cut the rate by another half a percentage point this year and expects four more cuts in 2025 and two in 2026.”

I don’t have a crystal ball here… but logic suggests as rates dip into the lower 6s, and then 5s, potentially into the upper 4s, buyer power will increase. And with that will come an *increase* in home prices - likely lagging behind those rate cuts over the next couple years here.

You could very well wake up in 2026 and be paying far more for the same home you passed on in 2024 due to 6.25* rates.

*rough estimate of where we are at in rates as of today 10/1*

Last month we discussed the NAR changes. How are things progressing?

We continue to see the majority of sellers offering partial or full compensation of buyer agents. And many buyers are having success negotiating compensation in their offer for the sellers who do not outright offer it. Even big names like Opendoor who in the past offered little to no compensation has adjusted their marketing to include compensation in an effort to sell homes during this cooler time of year. This matters for investors purchasing off the MLS who want to keep their costs as low as possible.

What strategies investors are using here right now.

This is based on what I'm seeing here in Raleigh. Investors continue to succeed here with short term rentals near and around RTP and downtown, or renting by the room on airbnb to young professionals. We continue to have a strong need for student housing with 3 major universities in the Triangle. Cashflow on long term rentals is still hard to come by, but every now and then the occasional townhome/sfh pops up that actually makes sense and will breakeven with long term rents. Investors are still opting to put down 25-30% to make the numbers work. Multifamily is still very rare, to the disappointment of my plex buyers, but value adds multifamily opportunities do exist for those who are diligent and patient. 

Keep in mind, data changes constantly. So if you're looking at this at a later time, likely not up to date anymore. Let me know what you'd like to see included on the next market update. Hope this helps!