All Forum Posts by: Peter K.

As one of the fastest-growing cities in the United States, Raleigh, NC, continues to attract attention for its dynamic economy, burgeoning tech sector, and vibrant cultural scene. In 2024, Raleigh's market situation presents a unique blend of opportunities and challenges that reflect broader national trends while also showcasing the city's unique strengths. This post delves into the key components of Raleigh's market as of 2024, including real estate dynamics, employment trends, industry growth, and the overall economic outlook.

The Raleigh area has historically been known for its robust real estate market, driven by continuous population growth and a strong demand for housing. As of 2024, the real estate market in Raleigh is experiencing a phase of adjustment. Prices, while still on the higher side compared to a decade ago, are stabilizing due to an increase in housing supply. This stabilization is a welcome change for buyers who had been priced out of the market in previous years. However, inventory levels remain tight for entry-level homes, keeping the competition high among first-time homebuyers.

Raleigh's job market remains one of the most resilient in the nation. The tech industry, a significant employment driver, continues to see growth, attracting both established companies and startups. Biotechnology, healthcare, and clean energy sectors also show substantial expansion, contributing to a diverse economic base. The city's unemployment rate remains below the national average, reflecting the strength of the local job market.

Education and research institutions, particularly those within the Research Triangle Park, play a crucial role in fostering innovation and providing a steady stream of talent to the workforce. This synergy between academia and industry has been pivotal in Raleigh's economic resilience and growth.

Consumer confidence in Raleigh is cautiously optimistic, buoyed by stable employment rates and a growing economy. However, concerns about inflation and the broader national economic policies continue to influence consumer behavior, with a trend towards more prudent spending and saving habits observed.

The economic outlook for Raleigh in 2024 remains positive, with growth expected to continue at a healthy pace. Investments in infrastructure, education, and technology are key priorities for sustaining long-term growth and addressing challenges such as affordable housing and traffic congestion.

Raleigh's market situation in 2024 is a testament to the city's adaptability and growth potential. While challenges remain, the fundamentals of Raleigh's economy—diversified industries, a strong job market, and a vibrant community—suggest a promising future. For residents, businesses, and investors, Raleigh offers a dynamic environment with ample opportunities for growth and innovation.

I'd love to hear your thoughts on this market - comment below!

Great post.

I'll add Durham, NC historically has been a great entry market for a lot of investors to start off due to its lower priced homes compared to other Triangle areas like Raleigh or Chapel Hill. On the flip side, there are risks associated as they are priced lower for a reason (Class C/D neighborhoods, etc.). You just have to weigh your risk tolerance and weigh the pros & cons.

Chris,

Quite interesting bill.

Honestly, bills like these get proposed and never makes it past GA. I don't see the benefit for this proposal in the first place. It'll also be difficult as there are loopholes to this (i.e. LLC, Corp, legal entities to bypass this requirement) even if this were to be passed.

I'd have to agree on your take that lawmakers are noticing housing affordability as one of the biggest take to propose bills such as these. Nonetheless, I don't think it covers the full scope nor is this helpful.

BP Community - I'd like to hear your thoughts. 

What are your take-aways and what are you doing in 2023 to plan/execute/re-evaluate your current strategy/processes?

Hi BP Community!

As you know, real estate is a constantly evolving industry that is influenced by a variety of economic, demographic, and technological factors. In recent years, the real estate market has experienced significant growth, driven by low interest rates, a strong economy, and increasing demand for housing. However, as the world continues to adapt to the impacts of the COVID-19 pandemic, the real estate industry is facing new challenges and opportunities. In light of all the events, I'd like to take a closer look at the current state of the union in real estate, exploring some of the key trends and factors that are shaping the industry today.

Interest Rates: One of the biggest drivers of the real estate market in recent years has been low interest rates. Low interest rates have made it more affordable for people to buy homes, leading to increased demand for housing. As a result, home prices have risen, and the real estate market has become more competitive, with many homes receiving multiple offers and selling for above the asking price. However, with recent (multiple) rate hikes by the fed to tame inflation, 2023 is the year markets will "normalize" with buyers/sellers staying put on the sidelines and homes stay on market for a longer period of time - shifting to a buyer's market. As an investor, this to me presents an opportunity with less competition to get in. 

Demographic Shifts: Another important factor shaping the real estate market today is demographic shifts. As the population ages, there is increasing demand for senior housing, and a growing need for communities that offer amenities and services that are accessible and tailored to the needs of older adults. Additionally, as the number of millennials entering the housing market grows, there is a growing demand for homes that are smaller and more affordable, as well as homes that offer innovative features and technologies. In my specific geo, I'm seeing "tiny homes" pop up more and more in the Triangle, NC area - Raleigh city council approved use of tiny homes in 2021 and permits are ticking upwards - millennials and younger generations are now ever more involved in home ownership and being creative about it.

Technology: Technology is also playing an increasingly important role in the real estate industry. Online platforms and digital tools are making it easier for people to search for homes, communicate with real estate agents, and close transactions. Additionally, advancements in virtual and augmented reality (AR) technology are changing the way that people view and interact with properties, offering new opportunities for home buyers and sellers to experience properties in new and innovative ways. With the recent buzz around AI-driven platforms and a huge push for AR, this would be an area of opportunity in 2023 to utilize some of these technological capabilities to supplement your real estate activities.

Impacts of COVID-19: The COVID-19 pandemic has had a significant impact on the real estate industry. The pandemic has led to increased demand for homes in suburbs and rural areas, as people seek more space and outdoor areas. Additionally, the pandemic has accelerated the use of technology in real estate, with many people using virtual tools to view homes and close transactions. However, the pandemic has also led to economic uncertainty and decreased demand for certain types of properties, such as vacation homes and commercial real estate. 2023 is the year impacts of COVID19 subside, as travel picks up and people get out of their homes (we've already seen a portion of this in 2022). According to forecasting by Economist Intelligence, global tourism will rise by 30% in 2023 - Forbes.

Future Opportunities: Despite the challenges posed by the COVID-19 pandemic, the real estate industry continues to offer significant opportunities for growth and innovation. As technology continues to evolve, there will be new opportunities to develop more efficient and effective ways of buying and selling homes. Additionally, as the world becomes more environmentally conscious, there will be increasing demand for homes that are sustainable, energy-efficient, and designed to reduce their impact on the environment. Take advantage of the Federal Income Tax Credits and Incentives for Energy Efficiency - this is huge for real investors to capitalize on upgrades & tax savings at the same time.

In all, real estate industry remains a thriving and growing sector, offering significant opportunities for innovation and growth in the years to come. Whether you are a home buyer, a real estate professional, or a seasoned investor, now is an exciting time to be involved in the real estate market, and to be part of shaping its future.

BP Community - I'd like to hear your thoughts. What are your take-aways and what are you doing in 2023 to plan/execute/re-evaluate your current strategy/processes?

This really depends on what your needs/goals are. Are you looking solely at future appreciation? or COC return? ROI? What is your motive for looking out here vs. other areas?

There are definitely opportunities and growth areas in the Triangle, but you have to marry that together with what you're trying to accomplish. Every investor has different goals and what they want out of investing (esp. out of state from their current state) so you have to balance between what you want vs. what's available in the current market landscape.

Happy to chat further.

Cheers.

Hey Jon,

Since it's still residential and you're not in the commercial space (5+), treat it as the same as if it's residential - the process is the same. 

The biggest thing you should look to get during DD period are: current lease (which you already have it seems), P&L statements for the past 2 years, any major repairs done (receipts), sub-metering (if applicable), what you owe as landlord vs. what tenant pays, estoppel agreement making sure you & tenants are on the same page,  etc.

Best of luck!

Great post @Chris Levarek! Love your journey starting from Durham, NC and expanding into other markets within NC, then going BIG @ national! Just like there's a snowballing method to paying down debt - there's the snowball method to scale your investments as well :)

"My agent suggested that I put 10% as my due diligence to win the property" - that's 50-100% of your down payment depending on which you go with, the biggest question is: are you willing to walk away from that $ if things turn sour? (inspections, etc.) Ultimately it's up to your comfort level. 

"competitive" offer is subjective. You have to look at the entire offer "package" - not just the DD. Factor in PP, DD, EMD, PP period, contingencies, etc. - sellers & listing agents look at the overall package, not just DD. My two cents. Good luck with your home search in Cary! It's very competitive out here.

I hear it's really hard for investors to get in because a lot of communities are not allowing investors to purchase, can anyone verify that? - it depends on HOA and/or restricted covenants.

Your rental comps will depend on the neighborhood. What is "too much" or "right" in your definition - this depends on the individual.

If you have any questions, feel free to reach out. I'm an agent operating in RTP.