RALEIGH – Price appreciation in the Triangle’s real estate markets has been well into the double-digits for much of 2021, with median sale prices reaching new highs in November—and real estate agents aren’t expecting there to be any significant drop in pricing this winter due to an imbalance in supply and demand.
How high are prices of real estate right now?
The median price of all real estate sold in Wake County during November 2021 reached a new record high, surpassing $400,000 for the first time, according to a new analysis of real estate records conducted by the Wake County Register of Deeds.
The analysis found that the median sales price for a parcel of real estate in Wake County was $405,000, an increase of $76,250 above the median price of real estate calculated using the same methodology for real estate sold in January 2021, or a change of 23.2% during that time period.
The Triangle’s real estate markets have been “frenetic” in 2021, said Jodi Bakst, a licensed real estate agent and the owner of Real Estate Experts. “There was a limited supply and excess demand. This is a recipe for driving up prices, which is exactly what happened.”
In total, the Wake County Register of Deeds analyzed real estate records for 2,913 properties sold in November, 2,754 of which were in the “core market,” which is described as sales of property valued at $1 million or less. In this market, the average sale price was about $406,700, based on the data shared by the Wake County Register of Deeds in an email containing the market analysis.
When demand outpaces supply, prices rise due to increased competition among would-be buyers, said Bakst. “Just about every home received multiple offers and properties closed well above the list price.”
Though there has historically been strong demand to live in the Triangle, said Bakst, that demand increased in the past 21 months with the onset of the global coronavirus pandemic.
With more people working remotely, more people considered relocating, and many considered moving to the Triangle from larger cities, said Bakst. Raleigh and Durham each appeared ranked in the top 15 regions in the country in a recent analysis of the optimal cities to relocate to if working in a remote role.
According to the data from the Wake County Register of Deeds, the number of transactions in the core market that occurred in October was 2,928, and in September, that number was 2,590.
That’s just not enough homes for sale, said Linda Craft, a licensed real estate agent and the CEO of Linda Craft & Team.
“Supply and demand out of balance,” said Craft. “Not enough homes for sale to meet buyer demand.”
The result has been a housing shortage, with prices rising, said Craft.
“Supply and demand always drives real estate values,” said Craft. The single most important metric that people could track to understand the Triangle’s housing market is the available number of homes for sale, said Craft.
“How many new listings enter the market. When the inventory starts growing the market will shift,” said Craft. “We are a long way from that happening. Builders can’t get supplies and new starts are not keeping up with population growth.”
In the new construction market, prices have risen in 2021, as builders face challenges. And that means that there’s not likely to be an end to the rapid price appreciation that has been observed in 2021, Jim Allen, a residential real estate developer, licensed real estate agent and founder of the Jim Allen Group, told WRAL TechWire in October.
The market would be considered at equilibrium with about five months of inventory available on the market, said Bakst. But that’s a long way off, probably, she said, as right now there’s less than a month of inventory available, and a “tremendous amount of inventory needs to come on the market to hit a balance.”