A Look Back at 2021 in Triangle Real Estate
These three key factors contributed to a year of record growth in the Raleigh-Durham area.
In many ways, the last couple of years call to mind one word: unprecedented. Real estate trends are no exception, and the real estate market in North Carolina’s Triangle area certainly saw unprecedented growth this year. Local expert Teresa Coker reflects on the primary factors that played a role in the strong 2021 market.
Population Growth
One of the key drivers in the growth of the Triangle market, Coker says, was the population growth in the area in 2021. “The Triangle continues to experience growth in population, which includes a migration of workers from high cost cities attracted to the high-wage jobs in our region,” she says. “With major announcements in early 2021 such as Apple adding its first east coast campus to Research Triangle Park, creating over 3,000 new jobs, and Google adding 1,000 new positions in Durham, the region is gaining attention from both workers and investors alike.”
In addition to the employees moving with those particular companies, these new offices are gaining the attention of tech workers across the nation. “With such announcements, the Triangle continues to attract those relocating to the area with its affordability and healthy job market, which supports growing industries such as research, technology, education, and healthcare.” The job openings in the area, coupled with the relatively low cost of living, have drawn families and young professionals to the Triangle in droves.
Low Inventory
As the population grew throughout the year and boosted demand consistently, inventory fell short. “We have also experienced record low inventory in 2021,” says Coker. “The Triangle typically averages around 9,000 homes for sale at any given time and this year we have hovered at or below 3,000 homes for sale. That's nearly a 70% reduction in available homes for sale, which has created a very competitive real estate market.” The gap between supply and demand has led to high-stakes bidding wars throughout the area.
Even though many people moving to the Triangle have the appropriate budget to afford a home in the area, winning a bid for one is a different story. “There’s less than one month of supply on the market, meaning it would take less than 30 days for all homes to be sold without any additional supply. That's far less than the six months of supply needed for a balanced market,” Coker explains.
This imbalance and the competitive market that’s resulted are what stand out most as Coker considers the past year. “The biggest change in real estate this year is based on the competitiveness of the market. With the lack of inventory, many homes are selling in Coming Soon status or within days if not hours of hitting the market.” Buyers are making offers sight-unseen, and timelines picked up speed throughout the year. “As a result, buyers need to be prepared to act fast, have funds available to be competitive, and be prepared to bring their very best offer. This includes being pre-approved, having a high due diligence, offering more than asking price and in some cases waiving contingencies.” In other words, there isn’t time to give partial effort on a home offer. Before you know it, it’ll be swooped up by another eager buyer.
National Economy
The Triangle market is a phenomenon of its own, with demand higher than many other U.S. cities. However, these trends do fit into a broader national picture. “We are experiencing historically low interest rates which has resulted in a record number of mortgage applications from both existing homeowners and first time buyers,” Coker explains. With low interest rates, homebuying budgets become more powerful, and the market becomes accessible to a larger portion of the population. This year’s low rates have only further fueled demand.
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