RALEIGH – Wake County’s economic development boom—from new projects, new construction, low vacancy rates in commercial and residential properties, and a red hot real estate market—is far from a summer mirage.
In fact, the economic climate in Wake County and the Triangle region is triggering real estate transactions in deals worth more than $30 million, with 12 such transactions in July 2021 totaling nearly $1 billion in value.
That’s according to data from the Wake County Register of Deeds.
Acting on a request from WRAL TechWire to help put these numbers in perspective, Luther Snyder, deputy director of the Wake County Register of Deeds, confirmed that the 12 transactions in this “very high-value segment” of the real estate market in July 2021 were the most since April 2015, when 16 such transactions occurred.
But the 12 transactions in July 2021 were worth far more than in any other month in the dataset, which spanned nearly 15 years.
The approximately $975.22 million in sales valuation recorded in those 12 transactions outpaced April 2015. The overall valuation of 16 such transactions in 2015 was $668.65 million, according to the analysis.
“Since January 2007, this past month had the second highest number of transactions in this category, but the highest valuation,” Snyder told WRAL TechWire. “It is interesting to note that many of them are apartment complexes, residential living, which is in high, high demand.”
Eight of the 12 transactions were for apartment complexes. With the vacancy rate in the Raleigh rental market below 4%, according to a recent market analysis from Apartment List, there has been a dramatic year-to-date increase in rental rates. Owning and managing apartment complexes may well be attracting investors to the region.
The July 2021 transactions worth more than $30 million
- Wells Fargo Capital Center – Raleigh: $148 million
- CAPTRUST Building – Raleigh: $142.5 million
- 3001 Hillsborough St (Stanhope Apartments) – Raleigh: $131 million
- The Piedmont Raleigh Apartments – Raleigh: $93 million
- Bainbridge Aviation Crossing Apartments – Morrisville: $79 million
- Broadstone Trailside Apartments – Morrisville: $71 million
- New Hill Place Apartments Phase Two – Holly Springs: $61.2 million
- Wolf Creek Apartments Tracts 1 & 2 – Raleigh: $59.1 million
- New Lot 5 for Hodge Road Phase I, LLC and Hodge Road Future Phases (Eastgate 540) – Raleigh: $58.6 million
- The Flats on 401 – Raleigh: $58.5 million
- Parker Lincoln Building (NC Lottery Headquarters) – Raleigh: $41.7 million
- Tree Tops Apartments – Raleigh: $31.5 million
The rest of the market
In the core market, defined by Snyder as properties with transaction amounts less than $1 million, fewer sales took place in July 2021 than in June 2021, resulting in a 19.33% decrease in total value of such transactions.
The data shows 3,411 transactions in this core segment of the market in June, but only 2,858 transactions in July.
In the high-value segment, which Synder noted includes transactions worth between $1 million to $30 million, 148 transactions occurred in July, totaling a little over $409 million. That’s compared to 158 such transactions in June 2021, totaling nearly $380 million.
Overall, the total number of transactions, measured by the recording of deeds, declined in July 2021.
“Deeds went down because of scarcity,” said Snyder. “Demand is still strong, and valuation is still strong, so we’re still in a strong real estate market.”
A deed is recorded when a real estate transaction is settled, in order to protect the purchaser from third-party claims.
A deed of trust is a mortgage instrument, and indicates when a property is financed, including when an owner refinances a property they already own as well as when a new buyer takes ownership of a property using a mortgage to make the purchase.
Lending activity—as measured by the recording of deeds—decreased by 11% in July 2021 compared to June 2021.
But that’s not because demand is slowing, said Snyder. Lending activity decreased due to low inventory of homes for sale, he said, noting that the median sale price of real property stayed relatively flat month-over-month, increasing to $384,000, an increase of $1,000 month-over-month.
When it comes to refinancing, lending activity also remains strong, despite the decrease in lending overall due to low inventory of homes for sale, said Snyder. There’s a gap in the market, which began following the onset of the COVID-19 pandemic, and still remains in the latest month of data, due to low mortgage interest rates, even if if lending activity has decreased, Snyder explained.
In the housing market, there’s increased demand for all different kinds of reasons, said Synder. “A lot of demand points toward new companies, new businesses, new facilities in the Triangle and that this is a great place to live in the country, and other factors.”