May 10, 2023 - News

Raleigh's growing share of wealthy renters

Credit line: Data: RentCafe; Chart: Tory Lysik/Axios Visuals

Apartment developers looking to attract high-income renters say they’re thinking beyond gyms and pools when it comes to amenities.

Why it matters: The push comes as many would-be homebuyers rent longer, incentivizing properties to compete for a growing cohort of high-income tenants.

By the numbers: The number of metro-area renters earning $150,000 or more grew 103.5% between 2016 and 2021, per U.S. Census data.

  • That's higher than the national average increase of 87.5%.
  • The share of renters making between $50,000 and $75,000, meanwhile, has grown at a far slower pace: 14.5% between 2016 and 2021.

State of play: Luxury apartments at one of Raleigh's newest complexes, The Eastern, start at around $1,500 a month and cost as much as $13,000 monthly for a high-end penthouse.

  • Apartments feature spa-like baths, nine-foot ceilings, customizable kitchens and include such amenities as an in-house spa and concierge services that offer pet arrangements and car detailing.

The big picture: Apartment construction is booming nationwide. Historically, new rental housing tends to hit at the higher end of the market, Chris Salviati, senior economist at Apartment List, tells Axios.

  • That trend has become more pronounced in recent years as rising project costs squeeze developers, he says.

Between the lines: High listing prices and mortgage rates aren’t making home buying as desirable as it once was, Salviati says.

  • "A lot of folks in that high-income band, who in the past would have owned homes, are now continuing to rent — whether that's for lifestyle reasons or because they are feeling like it's not a good time to buy," he says.
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