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The real estate market is a bubble and it will pop eventually. I think the last one around here was 2007, before the real estate/stock market downturn in 2008? We bought a 3 bedroom for $535K. If you believe Zillow, the market value was stable for almost 10 years. Then suddenly about a year ago it started going up. I think the last I checked it was getting close to $700K. We have no plans to sell but we do watch real estate activity in our neighborhood.
The word bubble implies artificial inflation, which at this time I don't think is the case. You have many people relocating to this area with cash to spend, as opposed to the last time where they had credit to spend.
People are coming for long term jobs, retirement, better weather, etc, and these people aren't going anywhere anytime soon. This wave of migration is expencted to continue well into the future.
The growth that you see in the population and in real estate prices, this time around, is organic. The rise in real estate prices is based on true supply and demand.
Add a few hundred thousand residents since then, and buildable areas have been greatly absorbed, to the extent that land has hit incredible prices/acre.
And, finding the large tracts in hotly desired areas for development has become harder and harder.
I would link the Infosparks graph, but it would have my contact info ...
from 2004 to 2007, new construction went from ~ 10K homes/yr to 13K.
From the crash to summer 2017, it never got back to 10,000 homes/yr. We've yet to hit even 12K homes.
Plus has anyone seen the recent census? The cities are popular. And people will keep moving to the biggest and the most prosperous cities of their states. So I really doubt it’s it a bubble just a perfectly terrible storm - low inventory, too many people per existing housing stock, low interest rates, pandemic induced shortage of building supplies. Something is going to give, but it won’t be anytime soon.
When prices get high enough prices will stabilize. Who will pay $1 million for a Raleigh 1 br/1 ba?
Yeah but people don't live forever and you need a place to live in the meantime. My parents still live in the 1960's ranch house they bought in NJ for $20K.
It took 56 years but the price has finally stabilized around $500K.
We have the demand (buyers moving up to larger homes plus all those folks moving here) and we do not have the inventory.
And as we all know, when the demand is more than the supply...prices rise.
In the 20 years I've been in Real Estate, the housing market has changed back and forth. Currently we are in a sellers' market. We will one day head back to a buyers' market.
The bubble burst last time was because too many people bought above their means and/or were extended credit when they shouldn't have been.
What we are seeing now is an influx of people coming here from higher priced areas that have the money to drive up our prices. I doubt we will ever see a bubble burst in the lower priced range homes (unless something catastrophic happens in the US). However I can see some of the very high priced homes having a bubble burst.
Coming from higher priced NY areas to buy lower priced homes. Might have been true a year or two ago but you have lost that advantage now for seniors anyway. The only advantage is lower taxes and as these bloated sales prices combined with population surges will end that.
We "were" looking to move from NY location to Raleigh/Durham area where we have friends. Looking for 55plus, specifically Carolina Arbore type community. While we anticipated a premium for such a community we certainly were not prepared for the crazy pricing increases. Hey if you can get $$ fine if you have somewhere else to go. I am not complaining about people taking advantage of the market. But I know we at least are no longer looking very hard at moving since the advantage of moving South to this area at least as a senior is gone.
My area, Westchester County NY, county of 1 million, suburbs of Manhattan. In many areas a million dollars will buy you a tenement like home. The taxes on that home will NUTS! I have friends in old 1400 sq ' homes that have annual property and school taxes of 15,000 to 21,000. No this is not an exaggeration. So moving to Raleigh/Durham area for seniors like ourselves was no brainer. But WOW how that has changed.
We find that we can now by 2400 sq ' home in new 55plus communities 30 minutes north of us with all the fixings FOR LESS than a much smaller 1600 sq ' and less property, a squeezed in side by side home in Carolina Arbor. The ONE and ONLY advantage left is that home will cost 12,000 annual taxes versus 4,600 in the Arbores. But never fear, selling prices and area growth necessitating more infrastructure will level the tax foeld before you know it I am sure.
So in my what it is worth opinion, yes the family 2 story large home market in your area will continue for some time due to need. Younger people moving for tech jobs etc in the area. But the retiree market in Raleigh/Durham area is bound for a bust.
I would love to move to area but for now seems to now be costs prohibitive to do so.
Coming from higher priced NY areas to buy lower priced homes. Might have been true a year or two ago but you have lost that advantage now for seniors anyway. The only advantage is lower taxes and as these bloated sales prices combined with population surges will end that.
We "were" looking to move from NY location to Raleigh/Durham area where we have friends. Looking for 55plus, specifically Carolina Arbore type community. While we anticipated a premium for such a community we certainly were not prepared for the crazy pricing increases. Hey if you can get $$ fine if you have somewhere else to go. I am not complaining about people taking advantage of the market. But I know we at least are no longer looking very hard at moving since the advantage of moving South to this area at least as a senior is gone.
My area, Westchester County NY, county of 1 million, suburbs of Manhattan. In many areas a million dollars will buy you a tenement like home. The taxes on that home will NUTS! I have friends in old 1400 sq ' homes that have annual property and school taxes of 15,000 to 21,000. No this is not an exaggeration. So moving to Raleigh/Durham area for seniors like ourselves was no brainer. But WOW how that has changed.
We find that we can now by 2400 sq ' home in new 55plus communities 30 minutes north of us with all the fixings FOR LESS than a much smaller 1600 sq ' and less property, a squeezed in side by side home in Carolina Arbor. The ONE and ONLY advantage left is that home will cost 12,000 annual taxes versus 4,600 in the Arbores. But never fear, selling prices and area growth necessitating more infrastructure will level the tax foeld before you know it I am sure.
So in my what it is worth opinion, yes the family 2 story large home market in your area will continue for some time due to need. Younger people moving for tech jobs etc in the area. But the retiree market in Raleigh/Durham area is bound for a bust.
I would love to move to area but for now seems to now be costs prohibitive to do so.
George in NY
Eh. "Advantage" is personally subjective, no?
Overall, NC is still a low tax state compared to NY across the board, and will continue to be so.
And, the climate is much more suitable for most seniors than upstate NY. Subjective, but many people are "just done with snow." And, liking 10-12 months of golf.
Most seniors I meet are moving to be close to kids and grandkids, who come here for better economic opportunity. Intangible.
I could buy your 55+ an hour north of the city. Not a chance on a rainy, cool day in Hades .
Personally subjective.
But, one size doesn't fit all. You have the opportunity to be more content where you are than here, so you should grab it.
Last edited by MikeJaquish; 08-26-2021 at 08:24 AM..
Taxes are much lower here than in NJ/NY and will remain so.
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