The Triangle’s growth and current mortgage interest rates have caused first time homebuyers to think twice about whether it’s the right time to invest in real estate. Affordable housing in the Raleigh-Durham area is a need that leaders across the region are committed to developing. In fact, the City of Raleigh itself has committed to the development of 5,700 affordable units by the year 2026.

One of the ways of answering these needs is through Missing Middle Housing projects, a new strategy that will drive growth in the Triangle. If this is a term you’re not familiar with, it’s one you’ll need to get used to hearing—especially if you’re a first time home buyer. Here’s what you should know.

The idea of Missing Middle Housing was developed in 2010 by Dan Parolek, a member of Congress for the New Urbanism (CNU) and principal of Opticos, an urban design firm committed to building diverse communities. As cities recognized a need to build new urban spaces that would attract and retain young talent, draw new employment opportunities, and provide aging demographics with opportunities, mixed use real estate projects grew in popularity.

Parolek’s concept was to provide options to build diversity into neighborhoods. The neighborhoods would be walkable. They would bring in a diverse selection of housing, transportation options, and even workplace choices. Missing Middle Housing specifically refers to the housing types available in these neighborhoods: multi-unit and clustered housing that provide a solution for the gaps in the current real estate market.

The name comes from two specific issues. First, these types of homes have mostly been illegal to build in most cities since the 1940s because of zoning codes and regulations, hence the term “missing.” And the “middle” portion refers to the difference between the single-family homes and high-rise apartments that have typically been the only answer for those looking to buy or rent.

Missing Middle Housing is designed to fit into existing residential neighborhoods. These types of homes include duplexes, fourplexes, multiplexes, and townhomes. Some buildings may also include live-work scenarios where nonresidential flex spaces create opportunities for storefronts, cafes, and other businesses to be on the ground floor of the building.

Cottage and bungalow courts, meanwhile, feature small, detached single-family homes that share a single courtyard. Typically, four to six bungalows or cottages are positioned on a single lot within a residential neighborhood. The shared courthouse invites neighbors to enjoy the spaces. 

The Raleigh City Council has already begun making changes to their ordinances to allow for more affordable housing options. In July of 2021, they approved ordinance 263-TC-451, which removed restrictions on the units per acre that could be built within the city.

In December of 2021, they approved ordinance  315-TC-461, which allows tiny homes to be a new living option within the Raleigh city limits. Previously, tiny homes were considered an accessory dwelling unit (ADU) at the back of a single-family home. While ADUs are not considered Missing Middle housing types, it was the beginning of what the city saw as an opportunity to fix the Triangle’s housing issues.

Then, in May of 2022, ordinance 362-TC-466 expanded the housing choices to more options, including the expansion of tiny home options, townhomes, and ADUs as part of the approved housing options. By August of 2022, all of these ordinances were effective.

While Raleigh is already moving toward fixing the housing issues the Triangle is experiencing, it won’t come overnight. 

“Like anything, you can pass a law or an ordinance but that doesn’t mean you’re going to see a sudden surge of activity because of that,” said Paul Kane, executive vice president and CEO of the Home Builders Association of Raleigh-Wake County. 

Kane said there are numerous builders who intend to participate in building Missing Middle Housing, but there are several reasons it won’t happen overnight. “I have talked to builders who are eager to be a part of this,” he said. “Since it’s opening up a housing type that has not been allowed to be done, we don’t have a lot of builders with experience in that. They have to develop the business models and the pro formas to make sure they can do it in a way that is compliant and profitable. Those things happen slowly.”

Kane said he’s happy to see builders working to be part of the solution for housing needs in the Triangle. “Often times what’s often perceived as one of the most revered parts of town in terms of housing is the old Oakwood neighborhood downtown,” he said. “The homes were built probably pre-World War II. They’re smaller homes, they’ve got garage apartments. We’re trying to get the housing ordinances back to where we could actually build another Oakwood in effect.”

He also pointed to other neighborhoods that are meeting the demands of the Triangle market.

“5401 North is a community that was responding to the market. It’s intended to be a little walkable community. It’s a master-planned community that recognized the realities of the day. It’s designed to have that closer-urban feel,” he said. “And then of course, all of the stuff that Kane Development is doing in North Hills. It’s amazing and it’s needed.”

Kane said the Triangle is currently 35-40,000 housing units short of where the community should be right now, and local builders are only building 15,000 units per year. As builders play catchup for two decades of housing needs, Kane said Missing  Middle Housing will be an important part of the region’s strategy. “We’ve got this great need in our community. We’ve got city leaders who identified and responded to that need and tried to release some restrictions to allow that need to be met,” he said. “There is not a housing style or size or type that we don’t need right now. We need everything.”

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