An Appreciation for Appreciation
Allen Tate President/CEO Pat Riley talks about growth in the Carolinas – and home prices
Real estate is a very specific business, so rarely is it explained in terms of averages. That said, when the Carolinas lead the way, it’s worthy of a conversation.
“We are growing in many positive ways that greatly exceed the national average,” said Allen Tate Companies President and CEO Pat Riley. “The Carolinas are also outpacing the national average when it comes to home price appreciation.”
In the March edition of Carolinas Market Update, Riley talks about these numbers:
• America’s population growth in 2020 is expected to be 0.5 percent; the Carolinas will grow 2.5 percent, or five times that amount
• Nationally, employment will grow 1.4 percent. Thanks to in-migration, the Carolinas are expected to grow 4 percent.
• Wages will increase an average of 2.4 percent across the country; we’ll see 5.5 percent increases overall in the Carolinas
Post-recession, the Carolinas saw home price appreciation of 5.5 percent per year – or greater. That’s much higher than the historic average of 2.5 percent, said Riley, and simply not sustainable for the long term.
Home prices are artificially inflated because of low inventory, which is because builders are not building to meet demand, Baby Boomers are not downsizing until much later and rent is high, complicated by investors buying up inventory homes.
“Appreciation varies from community to community, and appreciation should never be a security blanket for a homeowner. Homes today must be updated and in good condition to sell,” said Riley. “And everyone’s home appreciation story is different.”
Carolinas Market Update is targeted to consumers in the Charlotte, Triad, Research Triangle, High Country and Upstate S.C. regions. It is produced every other month by the Allen Tate Companies and features information, statistics, trends and predictions about the real estate market in North and South Carolina.