Raleigh's population grew 11.1% between 2016 and 2021, the second-fastest-growing large metropolitan area in the U.S. among markets with populations over 1 million.

Raleigh consistently ranks as one of the fastest-growing cities. Raleigh's population between 2016 and 2021 grew by 11.1%, the second-fastest-growing large metropolitan area in the U.S. among markets with populations over 1 million. Only Austin grew at a faster rate. With new residents needing somewhere to live, the area's housing and apartment rental market has been strong.

Wake County, where Raleigh is located, is also now the largest county in North Carolina, having surpassed Mecklenburg County (home to the city of Charlotte) in 2020. As the home of North Carolina's state capital, the metro has a large government and public administration employment base that adds stability to the region's diverse economy. In 2022, CNBC named North Carolina as America's Top State for Business, and Raleigh's jobs recovery has outpaced other Southern markets. Total employment is currently 7% above February 2020 levels.

Raleigh has a high concentration of companies in high-growth sectors like technology and life science, and is home to several universities that produce a highly educated labor pool. These important factors will continue to attract corporate investment.

Raleigh's concentration of technology and life science companies has greatly impacted the market's recovery rate. These high-growth sectors have helped attract companies to the Triangle, even during the height of the pandemic. Recent announcements from Apple, Spotit, INEOS Automotive, and Amgen provide a glimpse into Raleigh's thriving industry future. Last year, the technology giant Apple announced plans to construct a campus and engineering hub, investing more than $1 billion and creating over 3,000 jobs in the region. In addition, Raleigh's talent base and highly educated labor pool will continue to attract corporate investment. The area's universities, including North Carolina State University in Raleigh, Durham's Duke University, and UNC Chapel Hill, provide a steady stream of workers from which many local employers recruit.

This dynamic market has attracted a lot of investment, with currently 15K units under construction, a sizable supply expansion at approximately 13.4% of Raleigh's multifamily inventory. Within the last 12 months, there were 4.4K units worth of new deliveries and this has lifted the market’s vacancy to 8.1%, slightly above the market’s 10-year historical average of 7.1%. However, stabilized vacancy (excludes new assets) is at almost two percentage points lower.

Rent growth is at 3.4% year over year, with average rent at $1530/month.

Just like in the rest of the country, rental growth has decelerated in the last six months. Asking rent growth is increasing 3.4% year over year. Raleigh's high-quality labor force, much of which is employed in the tech or life science industries, has helped to support rising rental rates thanks to above-average wages, despite the recent supply-side pressures. Rents in Raleigh average $1,530/month, well below the national average of $1,630/month.

In 2022, Raleigh had the second-highest multifamily sales volume on record, demonstrating the popularity of the market and the greater Triangle region (Raleigh-Durham-Chapel Hill) among investors. The market is averaging $240,000/unit, slightly above the national average of $230,000/unit. Market cap rates have risen very slightly in recent quarters after compressing over the past several years and are comparable to other Sun Belt markets like Charlotte, Atlanta, and Nashville, at 4.3%.

The strong population growth alongside new jobs entering the market over the next few years are expected to maintain Raleigh's growth and will continue to support housing and apartment rental demand throughout the market.

Let’s connect to see how Bluefox Ventures can help you diversify your portfolio by investing in alternative assets like real estate.