The Triangle real estate market is changing

RALEIGH – For anyone wondering what’s going to happen in the Triangle real estate market the rest of the year, the latest available data from the Triangle Multiple Listing Service could suggest a slowing market, at least in terms of price appreciation.

But multiple real estate agents told WRAL TechWire this week that the slowing market with regard to median home sale prices could have been predicted, and may in fact be a resumption of seasonal trends that have been observed historically.

Still, no one is certain.

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Latest Triangle real estate market data

Here’s the latest:

The median sale price of all homes sold in the Triangle in July 2022 was $420,000, according to Triangle Multiple Listing Service (TMLS) data obtained by WRAL TechWire.

That’s dropped from $421,706 in June 2022.

And the median sale price dropped in both Wake County and Durham County – about 5%, in Durham compared to the previous month.

Here’s the difference: The median home sale price in Durham County in June 2022, across 552 closed transactions, was $430,000, according to data from TMLS. But in July, the median sale price fell to $410,600, with 443 closed transactions.

And in Wake County, the median sale price in July 2022 was $490,000 across 1,703 closed transactions, down from $493,081 in June on 1,970 closed transactions.

But median sale prices rose in Johnston County and in Chatham County. Chatham County median home sale prices spiked in July, up more than 10% from the previous month.

Median home sale prices in Johnston County rose from $375,000 in June to $380,000 in July, and in Chatham County, the median home sale price is now $662,500, up from $600,500 in June. The median sale price of real estate in Chatham County in May, however, was $650,750, the previous high mark in the TMLS data set.

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What all this means

“This year is very strong,” said Seth Gold, a REALTOR licensed real estate agent and broker with Bold Real Estate and Governors Club Realty who specializes in homes in Chatham County and across the Triangle. “But we are starting to see a little bit of a shift.”

Still, said Gold, July is typically a slower month in terms of sales volume and buyer demand, historically.

It’s just that didn’t happen in July 2020 or July 2021 as the housing market was scorching due to low inventory, high buyer demand, and ongoing shifts in homebuying and migration that led the Triangle to be among the nation’s hottest housing markets, said Gold.

“What we’re seeing is a plateauing of price appreciation,” said Tony Fink, a licensed real estate agent and REALTOR with Linda Craft & Team REALTORS in Raleigh. “Which was expected.”

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While most of the real estate metrics that become publicly available are in fact backward-looking, noted Fink in the interview, it’s quite possible that we’re seeing a slowdown of price appreciation.

That’s not to say this is a bad thing, though, Fink noted.

“We’re seeing a higher percentage of homes sell at or below list price,” said Fink. “These are signs of a healthy market, not of stress, given where we’re coming from, which was a highly supply-constrained market in early 2022 and throughout 2021.”

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So… what’s next for the Triangle real estate market?

Overall, said Gold, buyer confidence in the economy may be shifting.

“People are getting a bit more reserved,” said Gold.

That’s because of ongoing concerns about the future direction of the local, state, and national economy, and the recent volatility in mortgage interest rates, which have actually fallen in two consecutive weeks and dropped below 5% for the first time since April for the week ending August 4, according to the latest data from Freddie Mac.

But these shifts towards greater buyer reservations are not going to impact the market in the long run, said Gold. There’s growth coming to the Triangle, he noted, including technology companies, life science firms, and of course, the decision from VinFast to build its $4 billion automotive assembly plant in Chatham County, where this week it purchased the land on which it will construct the factory for nearly $44 million.

“These kind of companies do not just pick a location for no reason and have major money and resources that go into where they want to land,” said Gold. “That should add a ton of confidence to buyers in our market.”

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Price appreciation slowing, but not home values

Even though there may be signs of a slowing market, this slowdown may be a return to seasonal norms, Fink noted.

“I don’t think that’s a bad thing,” said Fink. “Seasonality went out the window in 2020, because of COVID.”

One of the things that happened in the markets of 2020 and 2021 was that price appreciation continued, as inventory remained suppressed, and in-migration continued to the Triangle, Fink noted.

“Agents who were representing sellers were having difficulty forecasting what would happen in the market,” said Fink. Which is why there were bidding wars for homes, including many homes that sold for more than $100,000 above asking price earlier this year.

But seasonality may be returning, with peak activity forecast for the fall, in September and October, when buyers may find it’s best to buy, a holiday slowdown, and then another peak in the spring between April and the end of June, Fink said.

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