How COVID-19 Has Driven the Triangle Residential Real Estate Market

The Raleigh-Durham metro area has continued to grow in spite of the COVID-19 pandemic. According to Move.org, North Carolina ranked number 5 on the list of states that gained new residents in 2020. As cited by RALToday, the City of Raleigh itself ranks number 2. Data compiled by moving company United Van Lines shows that North Carolina ranks number 7 on the list of states with the biggest influx of new moves between March 2020 and August 2020.

What is surprising is that despite the pandemic, the market in the Triangle continues to be a seller’s market. The popularity of the Triangle as a relocation destination, lowered interest rates, lack of inventory, and more companies moving to a remote work environment have fueled much of the upward trend in sales during 2020 and into 2021. New home builders cannot keep up with the demand on the market, leading to extreme scarcity, and homes being sold within days of being listed.

Skilled workers, specifically in the tech industry, are fleeing high tax states like California and New York and choosing the Triangle as their new home since it is no longer a requirement to live near the office in many cases. Also, many tech firms have a presence in the Research Triangle Park, so there are many opportunities to work in the office if someone prefers. Common attributes that transplants discuss when looking for a place to relocate are warmer weather, lower taxes, safety, and more green space. This has been the case for decades, especially with people moving south from the Northeast and Midwest, however, the pandemic has accelerated this. If someone lost their job in New York City and they had some savings stashed away, now would be the perfect time to make the move to a warmer, more affordable area. These challenging times have also given people the opportunity to think about how they really want to live as opposed to living somewhere that they need to live for work purposes. The country as a whole is focusing more on quality of life, which is accelerating relocation to markets such as Raleigh, and re-defining the entire real estate industry. 

Businesses are also continuing to seek cost-effective locations to replace headquarters and offices in expensive coastal cities, and are seeking things such as political stability, lower taxes, and an educated population with access to graduates from top colleges and universities, such as the University of North Carolina at Chapel Hill, Duke University, and North Carolina State University. North Carolina has a very low corporate income tax rate of 2.5%, as compared to Virginia at 6%, New York at 6.5%, California at 8.8%, and 5.8% in Georgia.  Even remote workers tend to choose new locations to live based on the job market and cost of living, as job status can change often and quickly in today’s employment market. North Carolina has a very favorable job market for skilled workers, and the cost of living is well below the national average. 

Many people during the pandemic that are now working from home, along with educating their children from the dining room table, started to seek more space as life shifted away from long commutes and busy schedules to more time being spent with family in the home. Since many housing options in major cities, such as New York and Los Angeles, offer very little space for a very high price, many residents that had been thinking about relocating to the Triangle finalized their decision, as home prices in the Raleigh area are much lower per square foot and the homesites are much larger. Nationally, less dense areas and neighborhoods are in demand, which makes buying a home in the Triangle attractive to buyers from very dense cities, like San Francisco.

The Raleigh-Durham housing market has remained very active despite the pandemic and has encouraged the continued influx of new residents to the area. The spacious landscapes, fair weather, high quality of life, relatively low cost of living, and growing job market are always reasons people decide to call the Triangle their home, but the pandemic has led many people to make changes to their living arrangements and often take the leap to relocate to a less dense area that still provides all of the urban amenities people from New York City and California are accustomed to on a daily basis.