How North Carolina Real Estate Market is In-Demand For Millennials?
There’s a reason why North Carolina is the sixth most visited state in the entire country. Whether it’s the pristine beaches of the Outer Banks or the breathtaking skyline of the Great Smokey Mountains, the state has tons to offer everyone—particularly young millennials in search of the ultimate combo of both a vibrant social scene and economic opportunity. The Tarheel state has a cost of living that is well below the national average, meaning working professionals have to pay significantly less for housing, utilities, health care, groceries, and transportation. Comparable to the majority of the national real estate market, North Carolina is currently experiencing a reduced inventory and increased demand—which are ideal conditions for real estate investors to net a premium return on investment. That is exactly why Corridor Funding has drastically increased the amount of money lent to real estate investors in North Carolina in 2021 and has big plans for future investments in the state.
There are a handful of key indicators of an ideal housing market: an expanding population, numerous job opportunities and affordability. If a given location exhibits all of these economic trends, investors should concentrate their property searches there. North Carolina is one of these areas. Over 10.5 million people call North Carolina home, and the state population has grown more than 10% for the past decade. It is currently expanding far above the national average—fueled in large part by a significant uptick in the number of millennials flocking to cities like Charlotte, Raleigh, and Durham. And with Forbes ranking North Carolina as the best state for business for the past five years due to its truly diversified economy comprised of world-class manufacturing, finance, insurance, real estate, government, and health care providers, the state is sure to continue to draw some of the best and brightest professionals for years to come.
Which cities you will find the Best Real Estate Investment Properties in North Carolina?
Charlotte is notable in that it is the biggest city in the entire state, with a local population of nearly 2.5 million. It consistently ranks in the top three states nationwide where millennials are electing to permanently relocate. Although the state’s collective population is increasing, 41% of towns are decreasing in the number of residents. Approximately 70% of individuals moving to North Carolina are targeting Charlotte and the surrounding communities that comprise the booming “Research Triangle.” The median home value for single-family homes is $262,385—an 8.2% increase from 2020. This positive market trend is expected to continue over the upcoming year, with anticipated value increases forecasted at six percent. The notable population increase and relative affordability in Charlotte has snagged the attention of many aspiring real estate investors. The area is growing exponentially and the demand for affordable rentals is skyrocketing. The market is fully expected to remain competitive for the foreseeable future. Investors should focus on growth markets on the outskirts of the cities where they can lock in affordable assets that will appreciate considerably as the area continues to develop and expand.
A popular destination for working millennials is Durham—the fourth largest city in North Carolina that continues to grow year after year. The median home value is $261,800, making the city affordable even though there is a limited inventory of properties. That’s a key metric for real estate investors, as it’s still possible to lock in a passive income-generating property at a below-market price. COVID-19 has prompted rising home values to slow down somewhat, but the Durham economy has proven resilient. Real estate experts expect that properties in this area should continue to appreciate much faster than other areas of the state. Local industry insiders have reported that real estate investors in Durham specifically have found lucrative success by targeting new construction developments prior to them being listed on the market.
As the capital of North Carolina and the host city for NC State University and the University of North Carolina, Raleigh is an ideal destination for millennials and real estate investors alike. The metropolitan area draws a seemingly unending stream of college students and professionals—all of which need flexible and affordable housing options. The median property value is close to $300,000 and properties have appreciated annually by 5% over the past three years. Similar to other college towns, multifamily rental units perform well in the Raleigh market. Vacant properties are an anomaly due to the high demand. If you can locate a reasonably priced rental unit, it could be the ideal opportunity for rewarding cash on cash returns.
The Greensboro real estate market is primed for successful investment, with rents steadily rising in conjunction with housing prices starting to drop. This unique congruence of market dynamics translates into the potential for optimized yields for buy-and-hold investors looking for an opportunity to get involved in one of the most affordable housing markets in the entire state. Greensboro, located in the central region of North Carolina, boasts the enviable city profile of being small enough for residents to know their neighbors, but sizeable enough to support a vibrant local economy. The several corporate headquarters and a healthy employment rate make the city an ideal spot for both families and businesses alike.
With a steadily rising population over the last 40 years and a nationally recognized low unemployment rate, Asheville offers affordable living and a stable economy with a wealth of job opportunities in virtually every industrial sector. Asheville has garnered the attention of a few notable national builders that have substantial contracts with suppliers, which makes building expenses in the area relatively affordable. For instance, national developer D.R. Horton has broken ground on many new neighborhoods in the Asheville area. Real estate investors should take note that the reduced inventory and increasing demand is making this market more competitive with each passing day—don’t miss out on your chance to get your foot in the door before prices explode.