RALEIGH – It’s not just home sale prices that are increasing in Raleigh and across the Triangle – the median price of renting a one- or two-bedroom apartment is increasing sharply, putting more pressure on people with fixed or lower incomes while a moratorium on rental evictions is nearing an end.

Price also can fluctuate, sometimes dramatically, overnight at many multifamily apartment buildings.  That’s driven, in part, by the adoption of software that uses an algorithm or algorithms to set a daily market rate of rent.  One apartment building in Durham, contacted by WRAL TechWire increased the lease price for a two-bedroom ground floor apartment by nearly $500 in a ten-day period between June 10 and June 20, as an example.

Rental rates in Raleigh have increased by 3.4% in June, compared to May, and the median price in Ralegihfor a two-bedroom unit is $1,375, according to data released this week by Apartment List, which tracks and analyzes about 100 rental markets across the country,.

Durham rental rates increased by 3.6% compared to the prior month, according to the market analysis.

To put into better context, costs are rising faster in the Raleigh area (11.2% over the past year) than the national average (8.4%).


“It’s a high demand time of year for renters, anyway, and it’s compounded because of the intense demand for housing,” said Sarah Dixon, supervising attorney in the Housing Unit of the Raleigh office of Legal Aid, in an interview with WRAL TechWire.  Legal Aid is a nonprofit law firm that provides free civil legal aid to low-income and vulnerable residents of North Carolina, and Dixon works with clients in Raleigh, Wake County, and Johnston County, many of whom are earning income at or below the federal poverty line.

“We have clients who have fixed or limited incomes and the market for what would be affordable for them is even less than what we would otherwise consider an affordable market,” said Dixon, noting that there’s virtually no availability for a one-bedroom rental under $600 per month, anywhere in Wake or Johnston Counties.

“It’s very rare,” said Dixon.  “It’s not what we’re seeing, what we’re seeing, in an apartment search for a one-bedroom, we’re seeing more than $1,000 per month.”

The U.S. Centers for Disease Control and Prevention recently extended its national eviction moratorium through July 31. But that’s not stopping sometimes wild jumps in rental prices.

Also impacting rents is the ongoing shortages in the homes-for-sale market.

“Vacancy rates are extremely low, hinting that low inventory and high prices in the for-sale market are keeping more households in the rental market longer,” said Rob Warnock, senior research associate at Apartment List.

ApartmentList graphic

The increases on a month-to-month do often occur, said Jeff Andrews, data journalist at Zumper, which also tracks rental markets in many metropolitan areas across the country.

“It is totally normal for rents to rise month-over-month in the summer,” said Andrews.  “There is a seasonal nature to rent whereby it rises in the summer and falls in the winter.”

Those seasonal fluctuations are driven by a few factors, Andrews added. Typically, fewer people wish to move during the winter months, meaning there is less demand for housing, and pricing of available rentals often reflect that.  Conversely, in the spring and summer, beginning in March, and continuing through July, more people are interested in moving, and demand increases, which leads to higher negotiated rental rates.

Housing sticker shock: Triangle home prices soar 10%, rentals climb 6.8% in just months

According to the Apartment List data, the median price in Raleigh for a one-bedroom apartment is $1,201, twice as much as the apartments that Dixon’s clients are seeking.

Not renewing leases

Many leases formed in North Carolina use a one-year term, and property managers and owner/landlords have a legal right to increase the rental rate at the conclusion of a lease term, with proper notice, and they may legally terminate a tenancy by providing the required notice, following the valid, legally-enforceable terms of the lease.

“We’re definitely seeing non-renewal,” said Dixon.  “We’re seeing more and more landlords not renew the lease, and seek other tenants.”

Many leases formed a year ago — when there was more uncertainty due to the pandemic — are now expiring, have already expired, or are about to do so.  Meanwhile, the moratorium on evictions, which was put in place to provide protection for renters, is set to end in a few weeks, and many renters and landlords who might otherwise qualify for the rental assistance programs set up by the CARES Act, are running out of time before they’d need to make a decision or a choice.

As of June 7, roughly 3.2 million people in the United States said they faced eviction in the next two months, according to the U.S. Census Bureau’s Household Pulse Survey.  In North Carolina, 32.6% of adults living in households reported that eviction or foreclosure in the next two months was either very likely or somewhat likely.  Those people and families are not only faced with evictions or foreclosures, said Dixon, they’re also navigating what options might be available to them to identify new housing, at a time when rental rates are increasing across the Triangle.

Housing providers in the Triangle are recognizing that it might well be a better business decision to sell what otherwise could or would have been affordable units, said Dixon, noting that anecdotally, what she is hearing is that there are owners deciding to sell a property, and the person buying it is purchasing with the intention of renovating it and then charging a higher rent, given the current market of both the sale market and the rental market.

“We are seeing that, as well,” said Dixon.  “Pricing out of affordability.”

Big Triangle increaases

The Apartment List data shows a 10.2% increase in rental rates in Durham, year-over-year, and in Raleigh, the price is up 11.2% year-over-year.  But the increase in the Triangle actually lags the statewide increase in rental rates, in the 10 markets that the company tracks, and in every city, rents increased, with the statewide average of an 11.7% increase in rental price. High Point (19%), Cary (14.7%), and Winston-Salem (13.7%) have all experienced year-over-year growth above the state-wide average.

Andrews told WRAL TechWire that because of the “noise” in available data, probably caused by the disruption to housing markets in the months following the onset of the coronavirus pandemic in the second quarter of 2020, comparing current rental rates to where rental rates were entering March 2020 is the preferred comparison to assess how the market is moving. Durham, in particular, is “noisy,” noted Andrews, whereas Raleigh’s rental market appears to be moving in a typical season cycle.

Even so, said Andrews, since March 2020, the median price for a one-bedroom unit in Raleigh increased by 4.9% and in Durham, that median price is up 20%.  For 2 bedroom units, the median price is up 6.5% in Raleigh and 12.9% in Durham, said Andrews, according to Zumper data.

Apartment List calculates rent growth by a repeat-transaction model, said Rob Warnock, senior research associate, which controls for factors like compositional changes in each market, and incorporates all units, not just one- or two-bedroom units, applied to different segments, according to the stated Apartment List methodology.