Editor’s Note: Each Friday, WRAL TechWire takes a deep dive into the Triangle’s real estate markets, including the latest on Raleigh rent prices and where it’s best to be a buyer or a seller, the topics of this week’s reports.
RALEIGH – Some good news for renters: the median monthly rental price for an apartment in Raleigh fell last month, according to the latest data from Apartment List.
The median monthly rental price for an apartment in Raleigh fell in September, according to the latest data from Apartment List. But that doesn’t mean folks are able to secure affordable rentals, as the median rent for a one-bedroom apartment is now $1,341 and a two-bedroom apartment is $1,525. Rental prices are still higher than they were a year ago, meaning a lot of people are struggling to find affordable housing.
Here’s the latest: Median monthly rent in Raleigh decreased by 0.4% in September compared to the month before, twice the decrease measured nationally. That’s the first time that rents have decreased month-over-month since December 2021, when rent for a two-bedroom apartment fell to $1,402.
But year-over-year, the price of renting in Raleigh has grown by 8%—faster than wages have increased, according to the most recent available data from the North Carolina Department of Commerce, which shows that average weekly wages in Wake County increased by 6.5% year-over-year.
While average weekly wages increased by $87 in Wake County, renting the median two-bedroom apartment in Raleigh now costs $113 more per month than it did a year ago, Apartment List found.
Still, the percentage increase between September 2021 and September 2022 is much lower than the prior year, when rents had increased 21.8% in Raleigh year-over-year.
Raleigh rent prices still high, with affordable places very limited
Using sites like Apartment.com is a really common way people find housing now. If you search for a one bedroom without any price limitations, – more than 2,300 are available. However, if we add just one filter and make the max rent 1$,200 dollars – which is what the median price was just two years – it drops to just 185 units.
A bit of hope: For the first time since December 2021, there’s been a month-over-month decrease in rent.
Still, median prices are higher than they were a year ago. Someone will have to shell out over $1,300 a month for a one bedroom – and more than $1,500 for a two bedroom.
The price of rent is still making it difficult for Raleigh residents to find a place to live, leading some adults to seek to share apartments or housing in order to defray the cost of renting, WRAL TechWire reported last week.
But that report came out before the latest data was available, showing the median rental price had fallen in September.
Does that mean there’s hope that rents will decrease? Unlikely over the long run, given that housing in Raleigh and in the Triangle is still very much in demand and with mortgage interest rates rising to nearly 7% recently, more would-be first-time homebuyers may stop or pause their housing search and instead look to rent for another lease period.
“While total rent increases have been higher this year than in the past,” said Rob Warnock, who discussed the latest Apartment List data with WRAL TechWire this week, “the trajectory of rent changes over the course of this year looks similar to pre-pandemic years.”
In a phrase, Warnock agreed that we may be seeing a return to seasonality of the rental market, much like the Triangle real estate market may be returning to more seasonal trends.
“I expect we’ll continue to see modest price declines for the remainder of the year,” Warnock said. “Nothing that will make a significant cut into the unaffordability crisis, unfortunately, but nevertheless a welcomed deceleration as the rental market enters [the] slower winter season.”
Rent costs rising faster than wages, increasing risk of homelessness in Raleigh
Low inventory paired with higher rent prices is making it challenging for Crawford to find places for people who are unsheltered.
“We’re finding that there are less and less available units,” said Kim Crawford with the Raleigh Wake Partnership to End and Prevent Homelessness.
“Even if you’re the average person who works every single day and never thought you fall into homelessness or housing insecurity, the way the incomes look right now, as compared to how the housing market is moving, you may be in a difficult situation relatively soon,” said Lorena McDowell, director of the Wake County Housing Affordability & Community Revitalization.
That’s because while wages increased 6.5%, but rent went up 8%.
“As leases are coming up for renewal, more and more people are finding themselves in a very difficult spot,” said Crawford.
While more units are being built, housing officials say they don’t expect the prices to decrease, especially because the Triangle is still in high demand and higher interest rates are likely to cause some first-time home buyers to pause their searches until the economy settles a bit.
WRAL TechWire reporter Jason Parker, the author of the report and a licensed real estate agent in North Carolina, works with journalists from WRAL.com to track and present market data and report on how people are experiencing the region’s changing real estate markets. These special reports will use the category tag “Triangle Real Estate” or “Triangle Real Estate Market.”