The Home Squeeze
From shrinking spaces and listings to rising rents—the squeeze is real.
Less for Your Money?
What a difference a year makes. While people continue to flock south—and to Raleigh in particular—for the region’s relative affordability, ironically, surging demand (and mortgage rates) has meant a skyrocketing housing market.
The result?
Many longtime locals can no longer afford to live at “home.” With the U.S. population center trending south this decade, according to a recent AP report, the region added a whopping 1.3 million new residents in 2022, with North Carolina not surprisingly trending among states for the biggest growth—behind only Texas and Florida.
Raleigh is the #1 Hottest Real Estate Market in the U.S.
Feel like you’re in a fever dream? You’re not. The cost of real estate in Raleigh has skyrocketed. We scoured citywide listings to show the seismic jump in housing costs across ZIP codes.
Sunset Hills | 1605 Lorraine Road | 27607
$1.175M | 2023
$761K | 2019
ITB | 3056 Lewis Farm Road | 27608
$1.2M 2022
$752K 2017
Southeast Raleigh | 2108 Ramseur St. | 27610
$445K 2023
$75K 2019
Northwest Raleigh | 3204 Plaza Place | 27612
$412.5K 2023
$250K 2010
Lake Wheeler | 5821 Allwood Drive 27606
$439.9K 2023
$260K 2018
ITB | 2513 Medway Drive | 27608
$1.129M 2023
$346K 2008
- $2,245 Median-priced home mortgage payment Raleigh-Cary from late November 2021–late November 2022
- $1,325 Nov. 2020–Nov. 2021
AFFORDABILITY
While Raleigh grapples with a shifting skyline and growth for the good (attracting big business, huge events, hospitality titans and the like), the city is also facing mounting concerns with housing affordability—not to mention cost of living, crime and transit woes (see p. 24). As the third-fastest growing county in the U.S., Wake County has work to do. No one is denying affordability as a huge issue—from Wake County Board of Commissioners Chair Sig Hutchinson to Mayor Mary-Ann Baldwin, city and county leaders have acknowledged the crisis and emphasized the need for a solution. Case in point, Baldwin believes housing is a right—not a privilege—and recently revealed the city is just under 70% on its way toward its goal of 5,700 affordable housing units by 2026. “We are on track to meet our goal,” says Baldwin. “However, increases in labor and supply costs, as well as interest rates, have and will continue to present challenges. City Council has approved additional funding for communities in the development pipeline and will continue to be aggressive in meeting our goals.” But while leaders grapple with affordability and the missing middle (see below), in the meantime, demand has outweighed supply—and suburban flight is real. While home prices did dip to end 2022 after a record peak last summer, sky-high 7% interest rates kept mortgages still out of reach. We take a look at what house you get for your money across Raleigh right now—and how that once median ~$300K single-family home suddenly feels out of reach.
Northeast Raleigh
7805 Wakebrook Drive
27616
$290K 2023
YEAR BUILT 1953
THE MISSING MIDDLE
Raleigh is growing—but is an entire population being left out of that growth? Yes, we’re referring to the “missing middle,” a hot-button term referring to “housing types between detached single-family homes and large apartment buildings, including duplexes, triplexes, townhouses and small apartments,” as defined by the City of Raleigh. Before 2021, many of these housing types were prohibited in select Raleigh neighborhoods, sparking heated conversations, but, despite text changes to Raleigh’s Unified Development Ordinance (UDO) in 2021 and 2022, affordable housing options for low- to middle-income residents are still, well, missing (a quick Zillow search for homes at $300,000 will garner just over 100 listings).
To be fair, the city is taking strides to mitigate the issue and provide more options for those stuck in the in-between. For instance, off Edwards Mill Road, a single home is being broken up into four more affordable ones; and a home in the Hayes Barton area is being knocked down to make way for 17 proposed high-end townhomes. But these projects are getting major pushback as residents fight to reverse the rezoning. In Hayes Barton, residents are frustrated and have gone as far as to say these townhomes would destroy the character of their community. Clearly we need a solution to meet in the middle on the missing middle…
Are ADUs a Solution?
A prime example of missing middle housing are accessory dwelling units (ADUs)—which were approved by Raleigh City Council in 2020. These typically 450- to 800-square-foot single-unit homes (think around the same size as a studio or one-bedroom apartment) are located on the same lot as a principal dwelling—either detached, attached or internal. And the City of Raleigh is making it easier than ever for residents to build ADUs on their properties with its ADU Fast Track program, which offers a gallery of plans already reviewed for building code compliance (permits, however, must still be individually submitted). Naturally, because these units are small and on an existing property, they’re way more affordable than building or buying a standard home—and in some cases cheaper than renting as well.
RISING RENT
What happened to supply & demand?
Rental prices in Raleigh are—to put it frankly—absurd as of late. And, despite more and more apartment complexes popping up in the area, renting in the City of Oaks remains incredibly expensive. As a matter of fact, rent is rising faster in Raleigh than any other major metropolitan area. We saw a 22.5% YoY increase in January—and Raleigh topped the list for median rent for the third month in a row. So, clearly, the whole supply and demand balance is out of whack here. Case in point: A recent Zillow report found that it would take four full-time minimum wage incomes ($7.25/hour) to afford rent on a typical one-bedroom in Raleigh.
The math… just doesn’t add up. Not to mention most apartments in the area require applicants to make 3 times the rental rate, or be incredibly close to it. So, if the rent is $2,000/month, you must make $6,000/month, which adds up to $72,000—while the average household income in Raleigh is only around $60K.
In essence, gone are the days when renting an apartment was more affordable than paying a mortgage on a home. As a result, many renters are being pushed into a “rent trap” in which they’re unable to save for a down payment on a home because all their money is going toward rent (roughly a quarter of NC renters pay more than 30% of their income in rent).
As one of the top five places to live in the U.S. according to Bankrate, Raleigh is only expected to continue growing in popularity—and population—making real estate likely more sparse and more competitive.
MICROLIVING
Does size really matter?
You might be wondering who the hell wants to live in a 160-square-foot apartment (aka microapartment)—not to mention for a relatively hefty $1,000 a month. With the announcement of local David Smoot’s plans for 100 single-occupancy 160-square-foot microunits on Hillsborough Street in January, it seems microapartments are the next big—ahem—thing in local real estate.
Clearly, microliving is about to take off. Why? Well, for starters, there’s a whole population of people who are rarely home and don’t feel the need to pay for a 600-plus-square-foot space when they really just need a shower and a place to rest their head. Case in point, Grubb Ventures and Jamestown specifically developed their soon-to-open 430-square-foot microunits at Forge at Raleigh Iron Works with those denizens in mind. Leaning into the lifestyle, they round out the development with a plethora of amenities that encourage residents to be out of the house.
The other driving factor for the microunit trend is price point. While maybe 600SF for $1,000 a month would be more appealing for some, that option just doesn’t exist in Raleigh anymore (see our “missing middle” section). So, this is what it’s come to: a closet, more or less, for four figures.
9 Coolest Big-City Amenities Coming to Raleigh
- Conference room that doubles as a podcast recording studio (Forge at RIW)
- Chef-inspired outdoor kitchen with grilling stations (Conclave Glenwood)
- Two-story fitness center outfitted with a private training room, multiuse studio, Peloton bikes, Echelon smart touchless mirrors, weight training equipment and more (The Signal)
- Indoor pet park and spa (The Residences)
- Indoor/outdoor rooftop lounge with panoramic city views (The Eastern)
- Luxor package room and locker system with climate control modules for perishables such as food and flower deliveries (The Residences)
- Saltwater pool designed with an industrial flair including an interior window feature (Forge at RIW)
- A dedicated wine lounge outfitted with a striking fireplace, warming drawer, wine refrigerator and TV alongside seating for an elevated retreat or entertaining space (The Signal)
- A fully outfitted game and entertainment space with shuffleboard and multiscreen video wall for gaming or game day (The Signal)
Parking Problems
As Raleigh grows, so too do parking woes. And, as long has been a problem in major metropolises, parking spots will not be plentiful enough to meet resident needs—and will come at a cost. We see this playing out in brand-new luxury builds like The Signal at Seaboard Station, which will offer the opportunity to secure a garage parking space for an additional fee. Residents may have access to additional spaces based on availability.
Defining Luxury
The term “luxury” is thrown around a lot these days—perhaps devaluing the term and blurring the line between such posh penthouses as the Eastern vs. say apartment complexes being built along Duraleigh Road (or all over town). True luxury—in such spaces as The Signal or The Residences—is defined by incredible design, best-in-class finishes (think Quartz Carrara Notte countertops and hotel-style backlit vanity mirrors), high-touch hospitality-level services and expansive avant-garde unparalleled amenities (see our list) intended to provide residents with seamless living.
Rent At A Glance
Finding an apartment in Raleigh in 2022—especially an affordable one—was no easy task. According to RentCafe, as more and more people relocated to our fine city, rental prices skyrocketed and landed the Triangle in the “competitive market” category. And it’s not just Downtown—rent in Raleigh is expensive, period. Though, yes, being in DTR will definitely cost you more. Today, it’s almost impossible to find an apartment for less than $1,000/month—including studios—with the average one-bedroom clocking in at $1,357 as of February 2023. Here, we take a look at different rental properties throughout the city and how they stack up.
- North Raleigh
- 1 bed/1 bath
- 823 sq. ft.
- From $1,269/month
- Northeast Raleigh
- 1 bed/1 bath
- 752 sq. ft.
- From $1,346/month
- West Raleigh
- 1 bed/1 bath
- 782 sq. ft.
- $1,850
- South Raleigh
- 1 bed/1 bath
- 766 sq. ft.
- From $1,429/month
- Village District
- 1 bed/1 bath
- 730 sq. ft.
- From $1,600/month
- Northwest Raleigh
- 1 bed/1 bath
- 832 sq. ft.
- $1,644/month
The Dartmouth North Hills Apartments
- Midtown
- 1 bed/1 bath
- 720 sq. ft.
- From $1,746/month
- Glenwood South
- 1 bed/1 bath
- 844 sq. ft.
- From $1,817/month
- Smoky Hollow
- 1 bed/1 bath
- 810 sq. ft.
- From $1,985/month
- Seaboard Station
- 1 bed/1 bath
- 729 sq. ft.
- $2,204/mont
