The dreaded housing crash of 2008 saw cities like Detroit with real estate for rock bottom prices, and even Manhattan and San Francisco real estate prices took sharp declines.
However, North Carolina faired better than most of the rest of the country.
According to Zillow.com’s housing market prediction, the median home value in N.C. holds around $150,000 statewide with the large metropolitan areas being higher than others. Zillow is predicting that the average increase in housing value will be about 3 percent in 2016.
Home value and home sales price don’t always match. The median sale price of homes in the state is about $172,000, which is greatly affected by the large concentration of banking, technology and military presence in pockets of the state that are less affected by the direct economic downturns. The National average of delinquent homes is 6.3 percent whereas N.C. is at about 5.2 percent.
According to Wells Fargo Economic Outlook, Charlotte and Raleigh lead the state in home appreciation and sales volume from 2010 to current date.
What's driving market trends?
"Young professionals," said Toni Flack, of Raleigh United Real Estate. "The young professional and transient family demographics are the market sales in the RTP area of the state."
According to World Property Journal, the current median home price in Wake County is higher than the median home prices during the 2005 to 2008 real estate boom as of the end of 2015.
Counties in North Carolina perform a countywide property valuation for tax value every 8 years. The last one performed for Wake County was in 2008, and the average residential property value increased 38 percent from that reassessment, creating sticker shock for homeowners and their tax bill.
This was largely due to the increase in real estate boom over the past 8 years prior to the assessment. Since that time, the real estate market took a huge downturn until the 2012 time frame where things have bounced back.
Perhaps a great indicator of this would be the most recent tax assessment bill, which assessed approximately 360,000 properties in Wake County and was sent out in late 2015. The overall increase in property value was a conservative 5 percent overall, with certain key areas like downtown Raleigh and the inner beltline areas showing double digit gains -- that is accounting for all the losses during the previous 8 years.
The very fact that the number is an overall increase is a positive sign for real estate value in the Wake County market. Real estate tax value is not a direct indicator of what a home may sell for on the open market, but as metadata analysis, it provides a snapshot of the real estate economic trends for that community.
What are people buying?
Market trends show that homes in the southern part of the United States are on average larger than homes in the northern and western counterparts. Real estate market also shows that the average square footage of the southern home was larger in 2015 than it was in 2014, showing that the overall market trends tend to be supporting larger home sales.
However, the popularity of the mega mansions rates about as high as U.S. Congressional approval ratings.
The modern day young professional in the Triangle area is trending towards location and functionality. The highest increase in sales and price are mostly around the central downtown revitalization area and other inner beltline areas. The gentrification of southeast Raleigh has had a direct affect on the housing price sales.
Even with more than 2,000 apartment complexes units added to the downtown area over the past 2 years, the demand is still higher than the supply and prices continue to rise. The young professional crowd has a desire to be closer to the tech-heavy areas, and the urban convenience of downtown Raleigh makes the area a highly attractive one to live.
But due to the finite space available downtown, the houses are smaller and more functional, which appeals to the modern-day young professional who shows more concern for functionality and eco conservation as opposed to opulence.
How does the market look?
Are you looking at preparing a move for spring? "Join the club," said Nancy Sullivan, a local real estate agent with Raleigh United Real Estate.
"Everyone is looking at moving, and we can’t keep up with the demand," Sullivan said.
According to local MLS data of the Triangle Real Estate, the first two months of 2016 has seen 1,427 homes listed in Wake County between the price of $150,000 and $300,000. Of that, only 5.61 percent of the listings expired beyond their list term. The average sale was 98.76 percent of the asking price, and it took about 51 days for a home to be sold from beginning to end.
"We are in desperate need of inventory," explained Raleigh United Real Estate’s Jean Williams, who has been in the real estate business for 15 years. "An average, median-price home will at most last a week on the market, and buyers have to be ready to make a decision quickly or someone else will take their desired home from them."
While the home sales continue to grow, and home value continues to increase, home inventory remains an issue in the Triangle area.
The 2008 housing crisis changed the mindset of the average homebuyers. People are no longer buying what they want, but buying what they need. Smaller and more functional homes are moving within days of coming on the market while larger, more extravagant homes linger.
Williams pointed out that the time to sell is now and the average, median-price home will move in under 30 days.
This story was written for our sponsor, Raleigh United Real Estate.