Local News

Raleigh Real Estate Prices Rising, but Still Competitive

Posted January 2, 2007 5:39 p.m. EST
Updated January 3, 2007 9:12 a.m. EST

— Raleigh is flirting with becoming one of the 50 largest cities in the U.S., but being a large city comes at a large price for home-buyers.

One 1,900-square-foot home inside the Interstate 440 Beltline has a price tag of $474,000. Another 2,800-square-foot home in the Five Points neighborhood is on the market for more than $500,000. Condominiums for sale downtown are selling for $1 million apiece.

However, real estate watchers believe the market in the center of Raleigh remains competitive.

“I definitely think Raleigh is a bargain,” said Ann-Cabell Baum Andersen, a real estate agent who specializes in downtown properties.

The average price of a condo downtown is about $240 per square foot, while a new unit with all the upgrades is about $300 per square foot.

“If you live locally and look at condo prices downtown, it blows your hat off,” Andersen said. “You’re totally, ‘Oh my gosh.’ But if you are coming here from Seattle, L.A. or Chicago or any of the metropolitan areas, we are inexpensive, comparatively speaking.”

A downtown condo in Phoenix sells for an average of $500 per square foot, and the average prices in Denver, St. Louis and Cleveland are $450, $375 and $400 per square foot, respectively.

Raleigh still is up and coming, and city Planning Director Mitch Silver said he believes Raleigh's housing prices won't rise to the levels of other cities because of the hundreds of new units under construction.

“We have a number of projects online, so we are concerned about the absorption, meaning how many are going to sell over time. We believe they will stay stable for quite a while,” Silver said.

There are other U.S. cities with downtown market values that compare to Raleigh’s. A home-buyer can get a condo unit in Atlanta or Pittsburgh for about the same price.

While Raleigh might be a cheaper place to buy a home than other cities, other expenses—like utilities and health care—could top those of larger cities. There are cheaper downtowns to live in, such as Des Moines, Iowa, and and Ann Arbor, Mich., but they are typically in smaller cities.