The real estate market in Winston Salem, the second-largest urban area in North Carolina, has seen a dynamic boom over the last two years, despite the effects of the pandemic.
The city is undergoing fast-paced development and has become a popular choice for real estate investment. The rental market is yielding large profits for investors, with the average rent increasing yearly by 5%. Since the cost of living here is lower than the national average, it is one of the most affordable choices in the Triad.
In this article, we discuss some of the recent real estate trends in Winston Salem that real estate investors need to know.
Current Housing Market Trends in Winston Salem
In June 2021, Winston Salem saw an 18.5% rise in home prices, as compared to last year, with $231K as the median price. The impact of the pandemic in the housing sector has resulted in an unprecedented seller’s market for single-family homes in Winston Salem. In addition, a drop in mortgages during the pandemic has boosted the demand for houses, driving the current real estate trends.
The limited supply of housing in the area and the many amenities offered by the city are the two primary reasons for the steady increase in home prices.
- Steady Housing Appreciation
Housing appreciation is a significant trend driving real estate investment decisions in North Carolina. In the Winston Salem area specifically, Buena Vista is the most appreciated region in the last two decades, followed by Ardmore, Old Salem, and Clemmons.
These areas have had the maximum number of houses for sale and are the best neighborhoods in the Winston Salem region, known for their single and multi-family housing.
Since these areas are considered the most desirable neighborhoods in the region, investors and buyers have flipped properties or converted them to rentals. As a result, with demand surpassing supply, the housing market here sees homes closed in around 33 days, at or above the asking price.
- Increased Rental Affordability
The Winston Salem real estate market has traditionally been a seller’s market. The median sale price of houses is around $231K which is lower than the US average. The monthly change in home prices around this region has been 1.5%.
Due to the city’s quality of life and attractive rental costs, Winston Salem is attracting renters from neighboring areas, with renter-occupied households making 37% of all the occupied housing units. The lowest rent in this area is $673 per month and can go up to around $1341 per month.
- Low Mortgage Interest Rates
One of the most important things people consider while buying a house is the mortgage interest rate, as it plays a significant role in determining the overall price and affordability of the housing market.
The interest on a housing mortgage in Winston Salem, as of August 2021, was 2.617% for a 30-year fixed-rate mortgage. The rate for a 15-year fixed-rate mortgage was 1.930%. The rates are lower than the national average of 2.660% for the former and 2.190% for the latter.
Real Estate Market Forecasts
The next couple of years will probably flatten the curve of the current housing boom. We expect that mortgage interest rates are likely to rise in late 2022 or early 2023. Due to the pandemic, the housing sector has seen a rise in popularity as real estate has become the most favored option for investment, due to low mortgage rates.
However, mortgage rates are likely to increase when financial markets anticipate the inflation caused due to the boom in the real estate sector. 2022 will see buyers and sellers in the Winston Salem area on the same level since the demand for Winston Salem properties will equal supply.