What's Going on in the Triangle Market?

One of the most frequent questions we get asked by our clients has to do with how the economics of our local real estate market are performing. Now, I must preface that I am neither a financial advisor nor a trained economist, but as brokers in the housing industry, our team is in a unique position to experience firsthand the pulse of our local market and advise our clients on how they can position themselves in the marketplace to achieve their goals - buying, selling, or investing. In other words, we’re not technically the best resource for this sort of information, but we’re on the front lines of the business - so it doesn’t hurt to ask.

Nevertheless, to understand where we are now, let’s take a look at where we came from.  With the hyper-driven market of yesteryear in the back of our minds, the effects of a “frenzied” housing scramble of late 2020 through mid-2022 left an unfavorable impression with buyers and sellers alike. Of course, for sellers, the market was sensationally positive - but even the best of outcomes were laced with challenges unprecedented in the home selling process. Buyers were faced with even more challenges as bidding wars and painfully low inventory drove housing prices to an all-time high. As brokers, we were also struggling to process and operate effectively amid the intense competition that the market manifested in a fairly abbreviated period of time. Age-old practices and proven methods became nearly obsolete, and brokers had to not only get exceptionally creative with their craft, but they had to develop thicker skin when up against appraisal deficiencies, incredibly small bidding windows, and tighter-than-ever closing timelines. The real estate world was on fire, and we were all in there together with watering cans and garden hoses attempting to keep the heat at bay. 

When interest rates began to spike in the Summer of 2022, the market - and everything we thought was the “new normal” began to change face (again). Soaring interest rates, inflation, and economic uncertainty suddenly became the most important topic of conversation for real estate shoppers - and as a result, the market slowed down to a crawl for the last two quarters of 2022. This isn’t where the story ends, but it wasn’t looking great there for a minute. 

Earlier this year, with counter-inflation methods in full-swing, interest rates continued to rise and inventory started to climb - slowly but surely. As inventory climbed, the Triangle market began to show signs of approaching balance (meaning, enough houses for the ready, willing, and able buyers in the market). But, and this is important, inventory was still painfully low - and while inventory was on the rise, we still were nowhere near a balanced market. The favor stayed with the seller, and this in conjunction with higher interest rates kept buyers apprehensive about getting engaged with the market. The market was crawling through the winter months. 

But then, Spring. 

The Spring market in Raleigh is a beautiful thing. The leaves are green, cars are yellow, and the sky is blue (don’t forget to take your allergy meds). But this year we had a rather warm and rainy season - and with little progress in the economy, the spring market seemed to follow in winter’s footsteps. Then things began to change. While inventory continued to tick upward, buyers started coming back into the market as it became evident to all of us that interest rates weren’t really falling and prices were continuing to increase. Our take on this is that some buyers, while reluctant, still needed to buy or had an intense desire to buy for one reason or another. When that is the case, it doesn’t matter what the rates are (date the rate, marry the house, right?). Furthermore, migration to the area remained incredibly strong, and local economic conditions - despite national declines - continued to show promise and growth. For reasons not particularly surprising, the Triangle market was bouncing back. 

So, here we are today. Bidding wars (in some areas) have returned. Large Due Diligence fees are starting to return to the offer table, and brokers are having to put on their creative caps yet again to get their offers accepted on behalf of their clients. For sellers, the game hasn’t changed all that much - there’s still a need for inventory and, depending on the location and style of the home, there’s a good chance the home will sell in multiple bids yet again. Don’t get me wrong, some pockets of the market are still a bit slower than others - but that’s for another post in the future. For now, if you’re a real estate buyer considering getting into the market, it’s a good idea to be prepared and know what you’re up against. As a seller, your options are still fairly exciting - and if you’re thinking about selling, it’s still a good time to do so. 

If you’re ready or know somebody who is ready to speak to someone on our team about next steps, don’t hesitate to reach out. We’ve got the skills and expertise to help you achieve your real estate goals.

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About the Author

Steven Squires is a full-time Residential Real Estate Broker, REALTOR®, and Team Lead at Umstead & Oak Real Estate Partners, brokered by Costello REI in Raleigh, NC. With nearly $100M in sales volume over the last 7 years, Steven understands the dynamics of the real estate market. He is a native North Carolinian calling Raleigh home for the last 25 years.