Nov 30, 2022 - News

Home prices slow in the Triangle

Data: Triangle Multiple Listing Services; Chart: Axios Visuals
Data: Triangle Multiple Listing Services; Chart: Axios Visuals

Home prices in the Triangle have fallen for four straight months, according to data from the Triangle Multiple Listing Services.

  • The Triangle's median sales price last month was $395,000 — up 8.2% from the previous year.
  • However, that price is down from a peak median price in June of $422,000.

Between the lines: Matt Fowler, the executive director of Triangle Multiple Listing Services, said home prices look like they are trending toward a "return to normal" growth rather than the "crazy, unsustainable rate that they were rising at."

  • Yes but: A lack of inventory and new construction as well as strong job growth in the Triangle should prevent home prices from dropping significantly, Fowler added.

Why it matters: Even with falling prices, though, rising interest rates are making the median home less affordable for a typical family in the Triangle and are preventing some with mortgages locked in at lower rates from moving.

  • The median income of a family in the Triangle now only reaches 68% of the income necessary to qualify for a median priced house at prevailing mortgage rates, Fowler said.
Change in Raleigh-Durham-area home prices, by ZIP code
Note: "Typical" refers to the average home value in the middle 30% of estimated home values in a region; Data: Zillow; Map: Erin Davis/Axios Visuals

What they're saying: "The story for me in the Triangle remains the lack of affordable housing [and] a lack of housing in general," Fowler told Axios.

  • "We have a dramatic under supply of properties that real people can buy."

Zoom out: While national analysts are coming around to the idea that house prices could see a correction, they still don't expect an outright bust, Axios' Matt Phillips reports.

  • Unemployment remains low. And most homeowners who bought in recent years have locked in rock-bottom rates, making their payments affordable.
  • That means a surge in defaults — like the one that crashed the U.S. housing market in 2008 and 2009 — is unlikely, economists say.

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