What it’s really like to invest in Raleigh, NC

This week, we head to the Triangle and hear from Ryan Smith at Cinch Home Buyers, who has flipped over 200 homes in this area of North Carolina.

Average home price: $424,924 (Down 2.8% YoY)
Homes that sell over list price: 13.2%
Homes that sell under list price: 70.6%
Average rent: $1,574

The pros: Rentals in the Research Triangle—the tech-and-research hub connecting Raleigh, Durham, and Chapel Hill—are like winning the landlord lottery. “The tenant quality here is the best in the Southeast,” says Smith. “Investors aren’t just getting rent checks, they’re getting rent checks from software engineers and PhDs. While prices have corrected slightly from their peak, the floor is incredibly high because we have close to 100 people moving here every single day.”

The cons: North Carolina real estate practice typically requires a nonrefundable “due diligence” fee from a prospective buyer, paid directly to the seller, to obtain the right to inspect the property. In competitive markets like Wake County, home to Raleigh, this fee can be substantial. “If you walk away, you lose that money,” Smith warns. “It forces you to be deadly serious about your numbers before you make an offer.”

His advice: “Be careful with ‘luxury condos’ in Downtown Raleigh. We have an influx of supply, and I see stagnation there,” Smith says. “If you want to get rich slow and stay rich forever, buy around the Outer Ring of Highway 540 in Fuquay-Varina, Wendell, and Knightdale. These towns used to be ‘too far,’ but the new highway loops have cut commute times by a fourth. You can still buy a three-bedroom, two-bath house here for under $375k that rents for $2,200. That math doesn’t work inside the Raleigh beltline anymore. The Outer Ring and I-440 up to Durham is where this generation’s gold is made.”