It’s become no secret that Raleigh is a great place to live. It combines southern charm, with all of the amenities of a bustling metropolis. This city, crowned the City of Oaks thanks to its old tree-lined streets, is seeing tremendous growth. It has a vibrant culinary scene, plenty of outdoor parks and amenities, and exciting nightlife.
This thriving cultural hub has the local real estate market to partly thank for its growth and success. Raleigh has been known as an affordable place to live for many years. As some people may be moving away from larger cities, Raleigh has since increased in population. With a 13.7% year-over-year increase, it begs the question: Where is the future real estate market of Raleigh headed?
What is the Draw of Raleigh?
In short, Raleigh is able to combine the old with the new. The capital city of North Carolina, Raleigh, was founded in 1792. It is a city steeped in history, from early Colonial settlers to the textile boom of the early 1900s, Raleigh has had slow and steady growth. Today, Raleigh has the same classic southern beauty but with a modern spin. The city has many attractive features including,
– Arts & Culture
– Deep-rooted History
– Numerous City Green Spaces
– Vibrant Culinary Scene
– World-leading Industries
– Access to Nature Preserves and National Parks
With so many amenities that give residents the old world charm with new world industry, culture, and food it’s no wonder both people and businesses are flocking to the city.
Why is Raleigh Real Estate so Attractive?
Because of the array of different features the city has to offer, there has been a huge influx of corporations and people interested in moving to the city. According to the latest census data, Raleigh’s population has increased by 19.73% in the past 10 years. This is an average growth rate of 0.99% per year, which is almost double the national average growth rate of 0.5%.
Raleigh has a robust industry of tech, finance, agriculture, and manufacturing. Therefore even though the global pandemic, they were poised to adapt to the changing market without too much disturbance. The diversity of industry meant the dips in one sector could be overcompensated by another.
The city has not only seen a growth of residents but also tourists, there are on average 16 million tourists who come to Raleigh. The main draws are,
– City’s culture, food scene, nightlife
– Available commercial event spaces for conferences and corporate meetings
– Rich and diverse history
The city is still considered to have an affordable housing and rental market, especially when compared to larger cities. As we continue to see a large exodus from major city centers, particularly after the Covid-19 pandemic, people are looking for an affordable option that still provides the same level of amenities. Raleigh fits the criteria. The median home cost is $341,000 which is well below the national average of $401,000. This affordability has resulted in the second-largest greater city area expansion in the country.
What is the Real Estate Forecast for Raleigh?
In terms of the outlook for real estate projections for the remainder of 2021, it can be broken down into 2 categories:
Residential Real Estate
Real estate purchases in the city have increased 13.7% since 2020. In terms of rentals of apartments and multi-family homes, there has been a slight dip in 2021 with the occupancy dropping to 94.1%.
However, with a stabilized job market, average home income, and changes in the unemployment rate continuing, it is anticipated by 2022 the occupancy rate will rise to near 95%. With an increased occupancy percentage comes an increase in rent. 2021 saw a rent increase of 4.4% with a similar or high growth expected for 2022.
Commercial Real Estate
Over the past few years, the inventory for commercial spaces was limited. After the pandemic, there was a large increase in inventory, which meant the average rental cost did decrease.
However, as we move into 2021 the price per square foot has increased 4.4%. With economic indicators pointing towards a decreased unemployment rate, it is anticipated the vacancy rate will decrease alongside.
Commitment to Raleigh
As Raleigh continues to expand and grow there will be companies ready to support it along the way. Capital Catalyst Partners is excited as it continues to invest and acquire properties in our community. Together we can build an even better Raleigh.