Triangle is a top 5 real estate market for fifth year in a row. See who’s No. 1.
The Triangle dropped to the nation’s No. 2 housing market in the Emerging Trends in Real Estate 2022 report, from its first-ever no. 1 ranking last year.
But the region remains among the top five hottest U.S. markets for the fifth year in a row in the annual report from the Urban Land Insititute and PricewaterhouseCoopers. The report and forecast are based on surveys of nearly 1,700 real estate experts and nationwide real estate data.
Raleigh-Durham has consistently ranked in the top 10 markets for even longer, according to the ULI’s forecast reports. That’s due to its attractiveness for real estate investors, homebuilders and employers, who have shifted their eyes to Sun Belt regions in recent years for their economic growth potential.
Although the Triangle lost the overall top real estate ranking to Nashville, it ranked first nationally for homebuilding prospects for the third consecutive year. Charlotte placed sixth and seventh in these two rankings, respectively.
The remaining three metro areas in the top five were Phoenix, Austin and Tampa/St. Petersburg, in that order.
“There’s a not a lot of surprises in the top five (markets to watch),” said Andy Warren, director of research for PwC, in a broadcasted ULI conference. “The Triangle Region was number one last year; (it) just missed being number one this year by a hair. Every year I’ve talked about the idea that the differential between 1 through 20 is something you kind of almost need to look at as a mass group.”
In 2022, the ULI forecasts again that Sun Belt cities will be the top destination for people moving from major urban metros to smaller, more affordable cities and suburbs. The Triangle is the top contender of these metros, particularly now as companies delay a return to offices and permanently switch to remote work in the pandemic.
The Triangle housing market has made national headlines since last year with a boom in single-family housing sales, demand and prices — and in turn, a great decrease in supply.
There’s a housing affordability crisis in America and it’s evident in the Triangle. The ULI reports prices and rents are rising at their fastest pace while modest wage gains lag behind. In rapidly growing Durham, homeowners are turning to the county for help in paying tax bills as land values climb, The News & Observer recently reported.
Triangle is a migration destination
Classified as a “magnet market” in the ULI 2022 report, Raleigh-Durham is growing more quickly than the U.S. average in both population and jobs.
“Their demographics are also skewed toward faster economic growth prospects with higher proportions of millennials and gen-Xers and relatively fewer seniors and retirees,” the report says. “These metro areas are also the preferred markets for investors and builders, with the highest average ‘Overall Real Estate Prospects’ ratings of any group in the Emerging Trends survey by a wide and growing margin.”
Within the “magnet market” category, the Triangle also placed in the “supernova” sub-category along with Nashville and Austin for their explosive popularity for residents and companies, with an emphasis on its attractiveness for educated millennials, the report notes.
“The idea is that maybe we should start thinking of these as ‘gateway cities.’ The interest and opportunity to invest in these cities is greater than it has been before,” said Warren.
The population in these mid-size metros has grown by 3.6% on average annually, more than four times the 0.8% national average.
The biggest rise in the latest North Carolina population count of the 2020 Census occurred in the Triangle area’s six counties and the Charlotte area’s six counties — these now account for nearly 39% of the state’s 10.4 million residents, up from 31% in 2000, The N&O previously reported.
