The real estate market in North Carolina stands out as an enticing choice for investors. Among its vibrant locations is Durham, NC, which is home to around a quarter million people. Situated in the heart of the Durham-Chapel Hill area, this bustling city is part of a larger metro area that includes Raleigh and Chapel Hill, totaling over two million residents and encompassing the state capital.
Given the competitive landscape, reduced days on market, and high percentage of list price received, the current market in Durham County leans slightly in favor of sellers. However, buyers can still find opportunities, especially with favorable interest rates and a diverse range of listings.
Durham specifically holds immense promise for real estate investors. A blend of abundant job opportunities and reasonably priced houses has fueled substantial growth in the Durham real estate market. The market has rebounded impressively from the housing bubble burst, gaining favor as an investment destination just two years after the 2008 market crash.
With a thriving population and a robust economy, the rental demand in Durham, North Carolina continues to surge. The enduring appeal of the Triangle area, attracting both new residents and those from out-of-state, contributes to the market's strength. Real estate investors are particularly drawn to the Durham and Raleigh regions, appreciating their growing and well-educated population along with a diversified economy that supports sustainable growth.
Current Durham Housing Price Trends in 2024
How is the Housing Market Doing Currently?
The year-to-date data for February 2024 reveals intriguing figures. According to the data provided by Triangle MLS, while the number of new listings has seen an 8.0% increase compared to the same period in 2023, closed sales have experienced a 10.7% decline. However, amidst these contrasting figures, the median sales price has shown a 3.2% uptick, reaching $395,000, indicating a sustained demand in the market.
Moreover, the average sales price has seen a modest 2.3% rise, signifying stability in the market. Despite a decrease in the total dollar volume by 8.3%, metrics such as the percent of original list price received and the percent of list price received have shown positive trends, indicating robust buyer interest and seller confidence.
How Competitive is the Durham Housing Market?
With days on market until sale decreasing by 13.1% compared to 2023, it's evident that properties are spending less time on the market, showcasing a competitive landscape. Additionally, the housing affordability index has dipped by 6.3%, potentially posing challenges for certain buyer segments.
Are There Enough Homes for Sale in Durham to Meet Buyer Demand?
One notable aspect of the current market dynamics is the significant decrease in the inventory of homes for sale by 23.3% compared to the previous year. This decline, coupled with a 1.6-month supply of homes for sale, underscores the supply-demand imbalance. While demand remains robust, the limited inventory could potentially drive prices higher, benefiting sellers.
What is the Future Market Outlook for Durham?
Considering the promising trends in median and average sales prices, along with the high percentage of list price received, the future market outlook appears optimistic. However, factors such as economic conditions and interest rates can influence market dynamics, necessitating vigilance and adaptability.
Is It a Buyer's or Seller's Housing Market?
Given the competitive landscape, reduced days on market, and high percentage of list price received, the current market in Durham County leans slightly in favor of sellers. However, buyers can still find opportunities, especially with favorable interest rates and a diverse range of listings.
As individuals contemplate their real estate decisions, data-driven insights like those provided in the February 2024 local market update serve as invaluable resources. By staying abreast of market trends and leveraging expert guidance, both buyers and sellers can navigate the dynamic real estate landscape with confidence.
Triangle Region Housing Market Trends
Increased Listings Amidst Evolving Market Conditions
According to the data by Triangle MLS, the year-to-date comparison between 2023 and 2024 reveals a 27.3% surge in new listings, reflecting a notable uptick in market activity. This surge, marked by 7,391 new listings in 2024 compared to 5,998 in 2023, signifies a growing interest in real estate transactions within the Triangle region.
However, despite the influx of new listings, the closed sales depict a marginal decline of 0.9%, showcasing a minor adjustment in the volume of completed transactions. This trend suggests a potential shift in buyer behavior or market conditions influencing purchase decisions.
Stability in Median Sales Price
One of the pivotal metrics, the median sales price, remains relatively stable with a negligible change of 0.0%. Despite minor fluctuations, the median price stands at $384,831 in 2024 compared to $385,000 in 2023, indicating a consistent valuation trend in the housing market.
Conversely, the average sales price demonstrates a positive trajectory, witnessing a 4.7% increase year over year. This surge, exemplified by an average price of $456,154 in 2024 compared to $438,491 in 2023, signifies a growing market value for residential properties.
Market Dynamics: Days on Market and Affordability
The days on market until sale metric portrays a significant reduction of 16.1%, indicating a faster turnaround time for property transactions. With 47 days in 2024 compared to 56 days in 2023, sellers are experiencing expedited sales processes, highlighting heightened demand or improved market efficiency.
Despite these trends, the housing affordability index reflects a 6.8% decline, signaling potential challenges for prospective buyers. With an index value of 82 in 2024, compared to 88 in 2023, affordability concerns may arise amidst escalating property prices and economic factors.
Inventory and Supply Dynamics
Notably, the inventory of homes for sale exhibits a significant decrease of 15.2% between 2023 and 2024. While specific figures for 2024 are unavailable, this decline underscores a potential imbalance between supply and demand, impacting market dynamics and pricing strategies.
Similarly, the months supply of homes for sale experiences a 13.6% reduction, reflecting a constrained market environment. This reduction, although indicative of a competitive landscape, may pose challenges for buyers seeking diverse housing options.
Durham Housing Market Forecast for 2024 and 2025
Durham, North Carolina is going to see heavy population growth over the next decade. Another seventy thousand people are expected to contribute to the demand for properties in the Durham real estate market overall. Some of these are people relocated for work. And many are the students who attend local colleges, stay for jobs, and then choose to start their growing families here. That relatively young population helps explain the roughly half of residents who rent and they're smaller than average household size.
As they grow out of studio apartments and into single-family homes, they drive demand for rented houses and property purchases. But the availability of jobs means many growing up here will stay here for school and work themselves, contributing to the sustainable long-term growth of the Durham housing market. The limited inventory and strong demand led to increases in prices for homes in the Durham real estate market.
Durham – Chapel Hill MSA comprises Chatham county, Durham county, Granville county, Orange county, and Person county.
- 564,273 Population [2010] – census
- 649,903 Population [2020] – census
- 1.4% Annual Population Change [2010 → 2020] [Citypopulation.de]
- Source: U.S. Census Bureau (web)
Durham County in North Carolina (USA)
- 326,126 Population [2021] – Estimate
- 0.32% Annual Population Change [2020 → 2021] [Citypopulation.de]
- Source: U.S. Census Bureau (web)
Current Market Status
The average home value in Durham-Chapel Hill stands at $403,188, reflecting a 4.5% increase over the past year. Additionally, homes are typically pending in approximately 19 days, indicating a **rapid** market turnover.
Market Forecast
Zillow's **1-year market forecast** as of February 28, 2024, projects a **2.6%** increase in housing prices. This forecast provides valuable insights for individuals planning to enter or exit the housing market in Durham.
Housing Metrics Explained
- For Sale Inventory: As of February 29, 2024, there are 1,189 properties listed for sale in Durham. This metric indicates the **availability** of homes for potential buyers.
- New Listings: In February 2024, there were 401 new listings added to the Durham housing market. This influx of new properties contributes to the **fluidity** of the market.
- Median Sale to List Ratio: The median sale to list ratio, standing at 0.991 as of January 31, 2024, signifies the **relationship** between listing prices and actual sale prices. A ratio close to 1 indicates properties are generally selling close to their listed prices.
- Median Sale Price: The median sale price of homes in Durham, recorded at $374,833 as of January 31, 2024, offers **insights** into the affordability of housing in the area.
- Median List Price: As of February 29, 2024, the median list price for homes in Durham is $413,000. This figure represents the **current market valuation** of properties.
- Percent of Sales Over/Under List Price: In January 2024, 28.0% of sales were **above** the list price, while 55.2% were **below** the list price. These percentages highlight the **negotiability** of prices in the Durham housing market.
Are Home Prices Dropping in Durham?
As of the latest data available, there are no indications of home prices dropping in the Durham area. On the contrary, the **average home value** has experienced a **4.5% increase** over the past year, suggesting **steady appreciation** in property values. Currently, the Durham housing market leans towards being a **seller's market**. This designation implies that there is a **higher demand** for homes compared to the available inventory. With properties selling swiftly and often at or above their listing prices, sellers hold a favorable position in negotiations.
Will the Durham Housing Market Crash?
While predictions about market crashes are inherently uncertain, the current data does not suggest an imminent housing market crash in Durham. Despite fluctuations in the broader economy, housing prices have remained **relatively stable** with modest growth projected in the near future.
Is Now a Good Time to Buy a House in Durham?
For prospective buyers considering purchasing a home in Durham, the decision hinges on individual circumstances and long-term goals. While it's a seller's market, low mortgage rates as compared to last year and the potential for future appreciation may make it an attractive time to buy for those who can secure financing and find a suitable property.
Durham Real Estate Investment Overview
Durham, North Carolina, has become a prime location for real estate investors looking to tap into the growing economy of the Research Triangle Park. The city offers a wide range of real estate investment opportunities, from residential to commercial properties. With its strong job market, favorable tax policies, and affordable cost of living, Durham is a great place to invest in real estate for the long term.
One of the primary reasons to consider investing in Durham real estate is the city's strong and growing economy. The Research Triangle Park, which includes Durham, Raleigh, and Chapel Hill, is home to more than 250 companies, including major players in the technology, healthcare, and finance sectors. This concentration of high-tech companies has led to significant job growth in the area.
Durham's affordable cost of living is another factor that makes it an attractive destination for real estate investors. The city's median home value is well below the national average, and the cost of living is 8% lower than the national average. This means that investors can purchase properties at a relatively low cost, while still enjoying a strong return on investment.
Top 6 Reasons to Invest in Durham Real Estate for the Long-Term
- Growing Economy: Durham is one of the fastest-growing cities in the United States, and this is largely due to the growth of the Research Triangle Park, which is home to some of the world's leading technology companies, such as IBM, Cisco, and Lenovo. This concentration of high-tech companies has led to significant job growth and a booming economy, making Durham a stable and thriving market for real estate investors.
- Job Growth: Durham's job market is strong, and it is continuing to grow. The city's unemployment rate is well below the national average, and there is a steady stream of well-paying jobs being created in the technology, healthcare, and finance sectors. This creates a stable source of rental income for real estate investors, and it also means that there is strong demand for homes to purchase.
- Affordable Cost of Living: One of the most significant advantages of investing in Durham real estate is the city's affordable cost of living. The median home value in Durham is well below the national average, and the cost of living is 8% lower than the national average. This means that investors can purchase properties at a relatively low cost, while still enjoying a strong return on investment.
- Favorable Tax Policies: North Carolina has some of the most favorable tax policies for real estate investors in the country. The state has a low state-income tax rate, and there is no inheritance tax. This makes it an attractive destination for real estate investors who are looking to maximize their returns.
- Diverse Real Estate Market: Durham offers a diverse range of real estate investment opportunities, from residential to commercial properties. This diversity provides investors with the flexibility to build a diversified real estate portfolio. It also means that there are always new investment opportunities available in the city.
- Quality of Life: Durham offers a high quality of life, which makes it an attractive destination for both renters and potential buyers. The city has top-rated schools, a thriving arts and culture scene, and access to outdoor recreation opportunities. This quality of life attracts a diverse range of people to the city, creating a strong demand for real estate investment opportunities.
Buying an investment property is different than buying an owner-occupied home. The investment properties are designed to make money as rentals, which means you must look at it solely as an income-producing entity just like any other business. Whether you are a beginner or a seasoned pro you probably realize the most important factor that will determine your success as a Real Estate Investor is your ability to find great real estate investments.
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Sources:
- https://durhamrealtors.org/market-tools/
- https://www.trianglemls.com/tmls/market-trends/
- https://www.zillow.com/durham-nc/home-values
- https://www.neighborhoodscout.com/nc/durham/real-estate
- https://www.realtor.com/realestateandhomes-search/Durham_NC/overview
- https://www.neighborhoodscout.com/nc/durham/real-estate