Editor’s Note: Every Friday, WRAL TechWire dives into the Triangle real estate markets, including housing affordability and the cost of buying a home that are the subject of this week’s reports. WRAL TechWire Journalist Jason Parker, the report’s author and a licensed realtor in North Carolina, works with reporters from WRAL.com to track and present market data and report on how people are experiencing the changing real estate markets of the region. These special reports will use the category tag “Triangle Real Estate” or “Triangle Real Estate Market”.
RALEIGH- The cost of buying a home in the Triangle continued to rise in July as housing affordability plunged yet again to a new record low, according to the latest data of Triangle Multiple Listing Service. But home values in the area may have fallen as market conditions change, a new report from Zillow found.
The report found that a typical home in the Raleigh area was valued at $457,006 in July, down 2.5% since June 2022. Still, that’s a 62.3% increase since July 2019, according to the study.
This leaves some buyers in a better negotiating position than they were just a few months ago. But even though seasonal trends have reappeared in local real estate markets, that doesn’t mean it’s any easier for Triangle residents looking to buy their first home at a reasonable price.
“We’re seeing an increase in inventory, but it’s not coming at a price point where I feel like the biggest hole is,” Monique Edwards said with NC Living Realty, in an interview with WRAL TechWire on Thursday. “Incomes haven’t increased that much for people to actually buy the house they’re looking for.”
Triangle homes are becoming less affordable even as the market softens
Did the cost of buying a home peak in July?
However, there may be good news for potential buyers. And this news is that the stock of houses for sale has increased in recent months, including in the lower price brackets.
While the typical mortgage rate for a 30-year fixed mortgage hit its highest level since December 2008 in July 2022 at 5.81%, the most recent week of data for Freddie Mac shows the average 30-year fixed mortgage rate of 5.13% as of Thursday. If mortgage rates are down from July 2022 highs and house values have fallen, is it possible that house prices will also fall?
It depends on how buyers act, Edwards said. And what is available on the market.
“Mortgage rates are much higher and buyers are saying ‘yes, I want a house, but not in these terms,'” Edwards said. “For buyers to commit to the price and mortgage rate, the house has to be perfect.”
This is one of the reasons stocks can rise in the Triangle: Buyers are getting a little pickier.
Triangle’s property market is slowing, but agents warn it could just be one season
Buyers willing to wait may be better off with the cost of buying a home
And there may be room for negotiation, Edwards said. If it’s not about the price, maybe about the closing costs or the repairs needed to get the house ready to move in.
“They’re ready to help buyers get into the house,” Edwards said. “I believe agents are telling sellers that because the rates are so high, if they want to sell the house, they’ll have to offer it.”
Some listings are even marketed, with sellers agreeing in advance to provide thousands of dollars to replace flooring or repaint a home, to attract buyers.
“We’re finding, at least in my business, and many real estate agents I’ve spoken to, have to talk to sellers that we’re not in the same market anymore as we were in February or March,” Edwards said. .
“There are a lot of people still looking, but it seems buyers are getting pickier,” Edwards said. And because of this, buyers who are willing and able to wait may be able to negotiate better terms or a better price, Edwards said. “Many sellers are unwilling to lower the price, but they are willing to open up the possibility of paying closing costs.”
Looking to buy a house in Triangle? “Be ready to strike,” says the officer
Still not enough houses for sale
Regardless of what a buyer may choose to do, they will first need to find a property. And there are signs that there may now be more homes available at prices below $347,000 than there were in previous months.
For example, in Wake County, the latest available data from the Triangle Multiple Listing Service shows that as of the last day of July, there were 248 homes listed for sale priced below $347,000, the most since November 2021.
And that metric is just the number of active listings available for sale at the end of the month.
But just because there were more houses available doesn’t mean more houses are available on the open market, or that there are enough of them, or that there are housing options for all potential buyers. , Edwards said.
And, not enough homes below $300,000 either
Edwards told WRAL TechWire that the area of the market with the most needed housing supply in Wake County are homes in good condition, move-in ready, for sale under $300,000. But right now there is a shortage of properties available between $250,000 and $300,000.
“I’m trying to tell you that if people saw the condition of properties being offered for a quarter of a million dollars, they would be disgusted,” Edwards said. “The public’s perception of clean, decent and livable just doesn’t match the condition of homes on the market at $250,000.”
Even at a higher price, TMLS data also shows that the number of affordable homes has dropped significantly since last July. TMLS ranks data in Wake County at homes priced below $347,000, and the number of new listings has dropped significantly since last July.
Data shows 356 new Wake County homes became available on the open market as new listings during the month of July, compared to 772 in July 2021.
More good news, if buyers can raise the price
But 356 of the total 2,226 properties, or just under 16% of all new listings in the county, were priced below $347,000.
Compare that to the year before, when there were 2,191 new listings, when 35.2% of all new listings came to market for less than $347,000.
What has changed is that the Triangle’s housing market has continued to experience rapid price appreciation, with the median selling price of homes in Wake County jumping 20.3% between July 2021 and July 2022. , according to latest market update of TMLS.
And these more affordable homes have seen increased competition, as evidenced by a video clip shared on social media by real estate agent Monique Edwards with NC Living Realty in February, with dozens of people are waiting to view a North Raleigh home priced under $300,000. With more competition, home selling prices have also increased.
There’s good news, though, if buyers can afford homes at slightly higher sale prices and buyers are willing to make a deal. Indeed, data from Triangle Multiple Listing Service shows that at the end of July 2022, there were 641 homes available priced between $347,000 and $469,999, the first time there have been so many homes. available on the market at this price since October 2020. .