million dollar homes (Raleigh, Cary: short sales, real estate, apartment)

[FallingH20]

I came from a large northern city where housing was relatively affordable around most of the city. I moved to Raleigh 2 years ago and both my husband and I were fortunate enough to increase our salaries. So, now, when it is time to buy a house we are looking around and much of what we see is either way too close to your neighbor (0.9-0.20 acreage is seriously a joke! why not just rent an apartment?) or far enough (.30-.90 acres) away that the added space tacks on a considerable amount of money to the home value. This weekend we spent a great deal of time looking in the outskirts of the area (to find a decent size lot which we think is .50 acre) and what we found were home plans with million dollar homes, some even surpassing 1.5 million. It was acceptable to see a few home plans like this, but as time went on we saw more and more. I'd venture to guess that we saw several hundred homes at this cost. And, quite a deal more in the $900K range. Can anyone share what jobs these folks have? Could there really be this many millionaires in Raleigh? Or, is this a classic case of many folks buying outside of their means? Please do share because I'd love to know why a hard working couple cannot have a decent sized lot with a decent sized house (and I don't mean 5000 sq. ft.) without moving out of the area?

Let me be more specific in my question. I am not asking where to live or where you know there is decent, affordable housing. I am simply asking how so many people in this area can afford million and multi-million dollar homes?

[rfb]

There are certainly plenty of homes $1 million or over, so there are likely to be plenty of people who can afford these (think supply and demand). I doubt anyone on this board has any idea whether the folks buying are stretching their budgets to afford such a home or are simply buying within their means. But, seriously, does it really matter what someone else can afford?

A large lot that is in a desirable area carries a certain value. A larger home, a bigger lot, closer proximity to desirable areas, or better amenities in a house all increase the value of a home. I'm sure we all wish it weren't so, but that is true here in Raleigh just like it is elsewhere. All any of us can do is look at our budget and what we are looking for in a house and make the whatever trade offs make the best sense for our situation.

[theS5]

There is a glut of $700k+ homes on the market in the Triangle. Maybe a realtor can fill us in on months of inventory. This number is only going to grow as the banks release short sales and foreclosures. I personally know two families in this price range looking to short sale their home.
It is only a matter of time before people take their homes off of the market or significantly lower their price.

[lottamoxie]

I purchased an older (now 21 yrs) home in Cary on .31 acres for under $220K in 2006, so it is possible to find larger lots without having to spend $1M.

Someone I know originally listed their large (4,000+ sq ft) home on 1+ acres for $825K and has dropped that price down many times, now to under $600K, so I suspect some of these high priced homes are just overpriced. When they purchased their home 4 yrs ago they paid under $500K for it so they were looking for a profit that was just plain greedy, considering this area and the economic climate.

[VickiR]

I sold a home a few years ago to a young couple that had bought a home in Calif. and sold it when real estate was HIGH. They came to Raleigh and paid Cash for their $900K home.

I sold a home to a plastic surgeon...over $1 million.

I know that Clay Aiken's home was over $1 million.

There are alot of folks in this area that are quite wealthy. And there are alot of people that buy more than they can afford.

Vicki

[saturnfan]

Originally Posted by VickiR

I sold a home a few years ago to a young couple that had bought a home in Calif. and sold it when real estate was HIGH. They came to Raleigh and paid Cash for their $900K home.

I sold a home to a plastic surgeon...over $1 million.

I know that Clay Aiken's home was over $1 million.

There are alot of folks in this area that are quite wealthy. And there are alot of people that buy more than they can afford.

Vicki

Good observation.

[lamishra]

I live in a home worth less than 200K in Cary, with .4 acres. I would say that your agent might be misleading you a bit if that is the best they can come up with.
As for the million dollar homes you mention, many of them are owned by people with multiple homes, professional athletes, singers, business owners, akers, investors... Don't feel like you should be able to afford these, because your average family can't, but yes, there is definitley a market for them here.

[lovebrentwood]

My opinion on the Top 10 Reasons for wealth in the Triangle:

1. They made their money in real estate in California or NY or elsewhere. In comparison to some other areas, NC real estate is super-inexpensive.

2. They are owners of successful businesses.

3. They sold their successful businesses.

4. They are highly successful doctors, lawyers, or in executive-level management in local multinational companies.

5. They inherited it from their wealthy parents or other relatives.

6. They were given money by their wealthy parents.

7. They made investments years ago and were very fortunate to translate stock profits into real estate at the right time.

8. They are successful entertainers or athletes.

9. They won a state lottery. (Not one of the more-common reasons.)

10. They robbed banks or embezzled money from their companies.

Just kidding about the last one. But the other reasons are most likely why people can afford million-dollar (and more) homes in the Triangle.

There are many wealthy people in the world. Many believe they are very, very smart, and that's why they are wealthy. In some cases, that is true. In other cases, I think it is a combination of making the right decisions and pure LUCK.

There are so many in this area is because for years, the Triangle has been on several "best places to live" lists, and people with money often seek out "the best."

Oh, and they all have great places at the beach, too.

(My peeve is when wealthy people say, "I worked VERY hard for what I have." I think most people work VERY hard for what they have.)

I am simply asking how so many people in this area can afford million and multi-million dollar homes?

[lamishra]

BTW, we also know people who have owned those houses, who have also been forced to sell them at a huge loss because whatever they were "banking on" didn't work out (business venture, home sales in other areas etc)_. So we have actually known people who owned those houses and who have lost those houses...it's a regular turnover...very rarely does new wealth stick around and IMO, not something that the average person should strive for or worry about.

[theS5]

Everyone has anecdotal evidence that Raleigh can support this high end market but it does not address the huge inventory of high end homes. It also does not address what foreclosures are doing to home values in that segment.

Originally Posted by VickiR

I sold a home a few years ago to a young couple that had bought a home in Calif. and sold it when real estate was HIGH. They came to Raleigh and paid Cash for their $900K home.

I sold a home to a plastic surgeon...over $1 million.

I know that Clay Aiken's home was over $1 million.

There are alot of folks in this area that are quite wealthy. And there are alot of people that buy more than they can afford.

Vicki