Nearly a decade after meeting at Winston-Salem State University, newlyweds Deondre and Ariel Cason are settling in the Triangle.
This June, they closed on their first place together: a new-build two-story townhouse on a .10-acre lot in the fast-growing subdivision of Barrington, just outside Zebulon. It’s about a 25-mile drive east of Raleigh.
The price tag: just under $300,000, postage-stamp-sized backyard included.
A photo of the fresh-faced couple from closing day is part of a gallery wall in their entryway. Four months later, they’re still relishing the new-build scent. A mix of fresh paint and cut wood.
“I love that smell,” says Ariel, standing in her open-plan living room. “If we’re gone for a while, like a couple of hours, and come back, it hits us. No one else has lived here. It’s ours.”
Both 29, they commute to Raleigh for work most days. Deondre is a middle school teacher at Centennial Campus. Ariel is a case management assistant at UNC Rex Hospital.
Zebulon wasn’t their first choice. As the easternmost town in Wake County, it’s still sleepy, mostly rural, with a population of 6,903 at the 2020 census. Their development is next door to the historic Bennett Bunn Plantation. (“There’s not much going on,” Ariel says.)
But at that price — $176 per square foot — it was their best option. The townhouse is 1,761 square feet and comes with three bedrooms and two-and-a-half bathrooms. Amenities include a clubhouse, community pool and sports field.
The builders, Dream Finders Homes, also allowed concessions. Using a buy-down loan, they only had to put 10% for a down payment, about $35,000. They now pay $2,083 monthly mortgage payments, roughly the same as what they’d paid when renting. HOA fees are $420 quarterly.
“We’ll be here for three years, at most five,” Ariel says. “Then we’ll find a single-family home closer to Raleigh.”
Rethinking the ‘starter home’
For many millennials like the Casons, this is their version of a “starter home” in the Triangle today.
Tired of skyrocketing rents, members of this age group — 27 to 42 — are entering the housing market in droves. Though it’s taken them longer than their parents, homeownership among millennials in Raleigh-Cary surged 73% in just the last five years, reaching a peak of 101,230, or 45%, living in their own homes, a RentCafe study found.
But faced with a chronic housing shortage, high prices, competition from out-of-state investors and a sharp jump in mortgage rates — now at a 25-year-high — many have given up on finding anything resembling the starter home of the last 70 years close to the Beltline.
Instead, they’re increasingly turning to smaller, more affordable alternatives: townhouses or condos. They’re also expanding their search to bedroom towns like Zebulon and Knightdale further east and Pittsboro out west, where deals are more likely.
The result is a townhouse boom spilling well beyond the Triangle’s edges. As city officials across the Triangle push to implement “missing middle” housing policies, builders are ramping up supply. They’re also building a diversity of housing types — duplexes, triplexes, townhouses and small apartments — to better their bottom line.
Despite permitting activity cooling nationwide, Raleigh-Cary saw the number of building permits for units in two- to four-unit buildings jump a staggering 145% year-over-year, according to real estate website Point2Homes.
Permit requests for multifamily buildings, with five or more units, spiked 8%, with apartment construction hitting a new peak.
Permits for single-family homes, meanwhile, slid by 11.2%.
“New single-family housing has become very expensive in Raleigh, due to high demand to live here, construction costs, labor costs and land costs,” Patrick Young, Raleigh’s director of planning and development, said in an email.
Newly built townhouses are often 10% to 20% cheaper than comparably sized new single-family homes, he added.
“It really has become the most available option for first-time and moderate-income home buyers.”
Even higher-end condos with price tags comparable to single-family homes are appealing to buyers. Indeed, under-contract sales of townhouses and condos priced at $470,000 and up saw a 3% hike in October year-over-year, Triangle Multiple Listing Service (TMLS) reported.
Another bonus: Builders are eager to cut deals to offload sitting inventory. With rising rates slowing sales and threatening new construction, they’ll offer incentives like mortgage buydowns, where they pay cash to lower the buyer’s mortgage rate.
“Every big builder is doing that right now,” said William Smith, Realtor with the Jim Allen Group in Raleigh. “There’s tremendous opportunity.”
Home Sweet Home
About 60 miles due west, Amanda Suchanek, 38, is unpacking her last boxes in her two-story townhouse, built by Tri Pointe Homes, in Townes at Chatham Park.
The 7,068-acre development on the east side of Pittsboro is in Chatham County, about a 45-minute drive southwest of Durham. It’s expected to bring thousands of homes to the community in the coming years.
After a decade of renting in Chapel Hill, Suchanek, a medical science liaison for a French biotech company, closed on her first property in June. A month later, she moved into a neighborhood still under construction.
“I’d been looking, on-and-off, probably five years,” she recalls. As a single woman, she never thought she could afford the down payment on one salary. “I just kind of wrote it off.”
Then a Realtor-friend put her in touch with a lender. “I learned it wasn’t as out of reach as I thought.”
She paid $414,000 for a corner lot, backing up against some woods. HOA fees are $160 monthly, covering the roof, siding, landscaping and maintenance.
She’s quick to point out the advantages of a townhouse. No yard work, walkable, less property taxes. Another big perk: the built-in community and security of having neighbors close by.
“I’ve already met most of the people [on the street.] We’ve had a glass of wine. It just feels nice.”
Even if she eventually outgrows the space, she sees the potential as a rental property. But she’s not in a rush. “I love this house. It’s perfect for me.”
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