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Southeast Raleigh's Housing Market: Rising Home Values and Shifting Ownership Trends
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Southeast Raleigh, a neighborhood in Raleigh, North Carolina, has experienced significant changes in its housing landscape over the past decade. The area has seen a general trend of decreasing homeownership rates, rising average home prices, and fluctuating average rent prices. The neighborhood's population has grown substantially, from 28,261 in 2010 to 44,384 in 2022, indicating its increasing appeal to residents.
The homeownership rate in Southeast Raleigh has shown a gradual decline from 2013 to 2022. In 2013, 74% of residents were homeowners, but by 2022, this figure had decreased to 66%. During this same period, average home prices in the neighborhood experienced a remarkable increase. In 2013, the average home price was $120,742, and by 2022, it had risen to $308,778, representing a 156% increase over nine years. This inverse relationship between homeownership rates and average home prices suggests that rising property values may have made homeownership less attainable for some residents.
Federal interest rates have played a significant role in shaping homeownership trends in Southeast Raleigh. From 2013 to 2016, interest rates remained very low, ranging from 0.11% to 0.40%. During this period, homeownership rates remained relatively stable, hovering around 72-74%. However, as interest rates began to rise more significantly from 2017 (1.00%) to 2019 (2.16%), homeownership rates declined to 65%. This trend aligns with the general economic principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
The percentage of renters in Southeast Raleigh has increased from 25% in 2013 to 34% in 2022, inversely mirroring the decline in homeownership. Average rent prices have shown some fluctuation but have generally trended upward. In 2013, the average rent was $1,255, and it peaked at $1,339 in 2019 before settling at $1,277 in 2022. The increase in the renter population, coupled with rising rent prices, indicates a growing demand for rental properties in the area, possibly driven by those priced out of the homeownership market.
In 2023 and 2024, the housing market in Southeast Raleigh continued to evolve. The average home price in 2023 was $312,314, showing a slight increase from 2022. In 2024, the average home price further rose to $317,588. These increases occurred despite higher federal interest rates, which stood at 5.02% in 2023 and 5.33% in 2024. This suggests a resilient housing market in the neighborhood, maintaining growth even in a higher interest rate environment.
Looking ahead, predictive models suggest that average home prices in Southeast Raleigh may continue to rise over the next five years, albeit at a potentially slower rate due to higher interest rates. Average rent prices are also expected to increase, driven by the growing population and the shift towards renting. However, if interest rates stabilize or decrease, it could potentially slow down or reverse the trend of declining homeownership rates.
In summary, Southeast Raleigh has experienced a significant transformation in its housing market over the past decade. The most notable trends include a shift from homeownership to renting, substantial increases in average home prices, and generally rising average rent prices. These changes reflect the neighborhood's growing popularity, economic factors such as interest rates, and broader housing market dynamics. As the area continues to evolve, balancing housing affordability with growth will likely be a key challenge for local policymakers and residents alike.
