HOT HOUSE: THE RED-HOT CHARLOTTE AND TRIANGLE HOUSING MARKETS SHOW NO SIGNS OF COOLING ANYTIME SOON.

AuthorWanbaugh, Taylor
PositionFIRST TAKE

Seeing the 950-square-foot bungalow near downtown Charlotte listed for $235,000 in June, the 28-yearold with a job in construction management offered $240,000 in cash, assuming the fast money would get the deal done. Not so fast: The home sold two days later for $285,000 to one of the other dozen bidders seeking the property.

Buying a house for 20% more than list price is a stretch, but it reflects the strong market in the Charlotte and Raleigh-Durham areas, real-estate industry officials say.

The average home value in the Charlotte market has skyrocketed by 13.6% over the last year, while the Raleigh market has seen a 6.8% gain, according to Zillow, a Seattle-based market research company. The median home value in the Charlotte region is $211,700, compared with $261,800 in the Raleigh region. Zillow expects the pace to slack off to a still robust 4.6% in Charlotte over the next year, and 4.3% in Raleigh.

"Our housing supply is about two months, which is considered a severe undersupply. That's the lowest it's ever been," says Stacey Anfindsen, a Cary residential appraiser who writes the

Triangle Area Residential Realty market report. "We have finite land where people want to live.... When you have people chasing finite resources, prices are going to go up."

Experts see little chance of a reversal in the housing market anytime soon. Zillow has rated Raleigh and Charlotte second and fourth, respectively, on its list of the 10 best U.S. housing markets this year. Population and income growth are driving strong demand for homes, with the number of people living in Charlotte increasing 16% between 2010-17. Raleigh saw 14% growth over the same period, based on U.S. Census Bureau estimates.

Meanwhile, the supply of homes for sale continues to shrink, partly because of the brisk market and limited incentive and capacity for builders to construct new homes. The Queen City had 20% fewer homes for sale in April than a year earlier, according to the Charlotte Regional Realtor Association. In the Triangle, slightly more than a fourth of homes that are under construction or recently completed did not already have sales contracts, according to housing market analysis company Metrostudy.

Housing starts in North Carolina have rebounded steadily since bottoming out at an annual rate of about 30,000 between 2009 and 2012, according to the Federal Reserve Bank of Richmond. In recent months, the annual pace has doubled to more than 60,000 starts, based on...

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