RALEIGH – Home prices may be high in the Triangle, but residents are a lot better off than those in most cities in terms of just how much they spend on housing.
A new study says Raleigh ranks sixth lowest among the 54 largest cities for how much is spent to make a mortgage payment. Durham came in as the 11th most affordable mid-sized city.
At the end of August, the median home sale price in the Triangle was $351,000, an increase of 22.9% since March 2020.
While many may think that home prices are high right now, the study by Filterbuy finds that folks looking for housing in Raleigh and Durham may be a lot better off looking in the Triangle than in most other cities in the United States.
Filterbuy analyzed housing costs relative to the share of household income in more than 300 cities nationwide.
Fifty-four cities classified as large ones, including Raleigh, while Durham was among 114 cities studied.
In Raleigh, monthly household income was calculated at $8,415, with median monthly housing costs at $1,315. So, housing costs were, at the medians, 15.6% of income.
In Durham, the study reported median monthly housing costs were $1,191, and median income was $7,789. Housing costs were 15.3% of income.
Though the Filterbuy study indicates that housing costs in the Triangle are lower, relative to income, there are still many people feeling squeezed by the increasing cost of housing.
“We are seeing that renters are twice as likely to be squeezed than homebuyers and homeowners,” said Nadia Evangelou, a senior economist and the director of forecasting at National Association of Realtors.
According to data shared with WRAL TechWire by Evangelou, 22% of Raleigh-area homebuyers are spending more than 30% of their income on owning a property, and 49% of Raleigh-area renters are spending more than 30% of their income on housing.
In Durham, 21% of homebuyers are spending more than 30% of their income on housing costs, and 50% of renters are spending more than 30% of their income on housing, the data set shows.
Rents are increasing, with rental prices of one-bedroom apartments going up 39% in Durham and 22% in Raleigh since March 2020, WRAL TechWire reported last week.
Homeowners are also reaping another benefit, said Evangelou – price appreciation. Evangelou estimated that the average homeowner has seen their property gain $90,000 in equity over the last five years.
“I predict that, at some point, the rapid appreciation of the past 18 months or so will back off, but I do think, barring unforeseen circumstances that are beyond our control, we should still see growth in our area just at a slower pace,” said Courtney Brown, a licensed real estate agent with Hunter Rowe. “Currently, we have net population growth driven by people new to the area for jobs or looking for quality of life while they remotely work.”