A market with no inventory where ‘cash is becoming king again’: How a decadelong surge in North Carolina’s housing market exploded in 2020

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For years, Anthony Steven and his wife had talked about moving from Long Island, New York, to North Carolina’s Raleigh area, within the Research Triangle that also encompasses Chapel Hill and Durham.
His wife worked remotely as a program manager for a central lab nearby, and a move would allow her more time in the office. Plus, “the cost of living on Long Island really was getting to be insane,” Steven, 40, told Business Insider. “But I had a good job and didn’t see the point in leaving.”
That all changed after Steven’s company laid off more than 100 employees, including him, as a result of the pandemic. Almost immediately, he said, he and his wife moved down south with their family.
“The cost of living in North Carolina and the quality of life were far more favorable than we imagined,” Steven said. “People are definitely friendlier here. There are a lot of transplants from all over the country all looking to meet people.”
Big multistate moves like the Stevens’ to the Tar Heel State have been happening for much of the past decade, but something is different about 2020.
“We’ve been a desired area for years,” said Linda Trevor, who’s been an agent in the Raleigh area for 21 years. But she said she’d never seen anything like the current market.
“The pandemic made people want to be here more,” she said.
The pandemic has heated up the already hot Research Triangle
The Triangle has long been attractive for its diverse employer base. It’s home to three major research universities — North Carolina State University, Duke University, and the University of North Carolina at Chapel Hill — and dozens of major employers, including Bank of America and Credit Suisse.
“There’s always been a movement from north to south,” said Lynda Edwards, a real-estate agent in the Research Triangle area since 1987 and a native North Carolinian. Even so, Edwards said, two major areas in the market, Cary and the north Raleigh area, have “had a huge surge this year.”
Census data indicates the population in the Raleigh-Cary metropolitan area jumped by 23% from 2010 to 2019, from 1.1 million to 1.4 million. Edwards attributed the area’s growth largely to Northeastern transplants — both young professionals and retirees — seeking a lower cost of living and a higher quality of life.

“This part of the South is really an anomaly,” Edwards said. “It’s rich with growth from people all over the world. I work with a very diverse group of people. It’s very different from anywhere else in the South, and I attribute that to the Research Triangle Park. I work with a lot of doctors, people in research, tech people, Duke employees, people that own laboratories, energy centers, pharmacy groups.”
This pandemic-era surge in demand has run into another pandemic-era housing trend: a severe lack of inventory.
“We had no inventory and still don’t,” said Edwards, who largely works with new-construction single-family homes and saw a 25% increase in her June sales volume alone. “There was a period of time where we had zero houses to walk through,” she said, adding that demand really picked up in the early summer and had shown no indication of slowing down.
Trevor agreed, saying she could’ve easily sold more had the inventory been there. “The buyers can’t find the houses,” she said. “Sellers don’t want to leave. Downsizing is impossible right now.”
Zillow data suggests that total inventory is down a whopping 41.4% in Raleigh, and Triangle Area Residential Realty said that in the wider Wake County it was down 46% at the end of August. Trevor said she’d never seen numbers this low.
With high demand and low inventory have come bidding wars. Trevor said one home that was listed for $615,000 sold for $681,000, more than $65,000 over the original price.
Across the Raleigh area, homes went under contract after an average of five days on the market, per Zillow, seven days faster than last year.

The inventory shortage goes beyond would-be sellers’ reluctance to list because of the difficulties of downsizing in this market.
Edwards said that design concepts and permit approvals for new builds take a significant amount of time, often up to a year, and that COVID-19-related office closures delayed the approvals needed to finish jobs. On top of that, building materials are back-ordered, and price hikes for materials have left builders uncomfortable passing those costs on to buyers.
“Builders are actually waiting to do new builds until construction costs go down,” she said.
Charlotte offers big-city escapees a change of pace — and draws in ‘half-backs’ from Florida
Housing markets are hot outside the Triangle too.
Since about 2014, Charlotte has drawn a growing number of Northern transplants, said John Siddons, who leads the city’s top small real-estate team, according to Real Trends.
This year, Siddons said, the demand for local real estate has been stronger than usual. Inventory is down 42.9%, per Zillow, while homes have typically gone under contract after six days on the market, 10 days faster than last year.
Local sales are breaking records too. Mansion Global reported earlier this month on a French Chateau-inspired lake house that went for $7.5 million, the highest-priced sale ever in the greater Charlotte area.
“I think the pandemic has been the big driving factor” of increased demand, Siddons said. But he also said Charlotte has long offered a positive change from the big-city feel of places like New York or Chicago.
“The cost of living is fractional in taxes alone,” Siddons said, equating Charlotte’s cost of living to the cost of private school and a mortgage in New York. “It’s the opposite of sticker shock.”
Siddons might as well have been talking about Joshua Paltz, who took the plunge and relocated with his family to Charlotte from the Northeast in January 2019. Paltz had lived in Albany, Long Island, and Boston, but a new career opportunity and a better quality of life drew them to Charlotte, he told Business Insider.
The high-quality schools, a lower tax rate, friendly and like-minded residents, and an opportunity to be outdoors 10 to 12 months of the year have all improved his quality of life, he said. So has escaping the “high stress level to perform professionally” that characterizes the Northeast. “I believe that is born out of the high cost of living, including taxes, mortgage, and overall stress, which includes commuting and the amount of time someone might spend in the car,” he said.
Paltz said he’d noticed a wave of 30- to 50-something New Yorkers moving into his neighborhood seeking a “better life.”

Siddons estimated that 40% to 50% of his recent clients were moving to Charlotte from major Northeastern cities. He said that about 25% of his recent deals were based on clients’ job relocations, while the rest were pandemic-era visitors who decided to stay.
Siddons said the buyers were coming largely from New York, Chicago, and Los Angeles, as well as from other cities in the Northeast.
He said the area was also popular with a certain sort of retiree “half-back”: someone who originated in New York and retired to Florida, then found themselves unhappy in Florida’s climate.
Any decent home within 20 minutes of uptown will almost certainly see multiple offers, he said, adding that the most successful buyers were coming with all-cash offers. Even with mortgage rates as low as they are, about 40% of his buyers were paying cash for their homes, he estimated.
He told Business Insider that a recent bidder had offered $10,000 more than the asking price, contingent on a loan, only to lose out to a lower offer that was all cash. The sellers were worried that the first bidder would lose his job, Siddons said. “Cash is becoming king again.”SEE ALSO: How Colorado emerged as the quarantine location of choice for rich Americans and a haven for millennials looking to escape the coasts
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