SALISBURY — Salisbury resident Tawanda Doby said she moved to Lakewood Apartments in 2019 and paid $850 a month for her unit.
His lease renewal for this year showed the rate would rise to $1,600. When she called the office to ask if this was an error, she was told it was for “regional market growth”.
That leaves Doby with less than $100 from one of her paychecks every two weeks, she said, although she earns too much to qualify for income-tested housing. She also takes care of three children. She said Salisbury needs more options for single-family families and those ‘in between’, meaning they don’t earn enough to support rent increases, but earn too much to income-based housing.
“They can’t afford the cost of rent that’s promoted, but they’re still earning too much for income-based (housing),” Doby said.
Whether it’s supply chain issues, lack of available property, or the 2008 economic crisis that led to a recession, local residents, real estate agents and others involved in the housing market fear that the challenges facing the housing market today will put off potential buyers, especially those who are currently renting but are looking for a home for the first time.
The latest cost of living survey compiled by Catawba College students at the Ketner School of Business shows Salisbury received a composite score of 92, putting it eight points below the national average. That’s lower than Charlotte’s rate of 94.8, Raleigh’s rate of 92.8 and Winston-Salem’s rate of 95.6. Data shows the average price for a 950 square foot, two bedroom unfurnished apartment in Salisbury was $954, which was lower than in Charlotte, Winston-Salem, Raleigh and Asheville.
Meanwhile, the average purchase price for a 2,400-square-foot, four-bedroom, two-bathroom home in Rowan County was $289,330, which was higher than Charlotte’s average price of $281,522 and Winston-Salem priced at $228,299, but far below a home in Raleigh at $323,846 or Asheville at $472,724.
Redfin’s market rent tracker shows rents in the United States rose 14.1% year-on-year to $1,877 in December. The nationwide monthly mortgage payment for homebuyers rose 21.6% year over year.
According to online apartment rental site Zumper, its National Rent Index showed a 12% year-over-year increase in the median one-bedroom rental rate across the country from January 2021.
Dan Wagoner of Wagoner Realty, which is both a property management company and a real estate agency, said the current housing market has caused “major challenges” for his business. Wagoner said these problems stem from a crisis older than the current pandemic: the 2008 recession. Although construction stopped at that time, the market looked promising until last year, he said. declared. Now, it’s hard to find available properties statewide, and rental rates have gone up because property values have gone up.
Wagoner said he receives daily calls about housing options, of which the company has only two at the moment. Years ago, the company would have up to 20 options open at once.
Wagoner said the company tried to avoid rent increases for tenants, but had to increase them by an average of at least 10%. But the company has tried to make the increases incremental each year to avoid a one-shot price hike.
“Years ago we did very few rent increases,” Wagoner said. “But now they’re almost annual.”
More housing needs to be built, he said, and it is starting to accelerate. But rising construction costs pose another challenge. Additionally, developers are looking for land on the lot or undeveloped land where construction has never taken place, as there is a demand for more rental properties and single-family housing.
Wagoner said potential home buyers are bidding well above the asking price and still not being accepted due to limited options.
“It’s a good deal for real estate agents, but not for potential tenants or buyers,” Wagoner said.
Lindsey Modica said she moved to Salisbury from Raleigh during the pandemic in June 2020. She was surprised to find rent rates comparable to those in Raleigh.
“I thought moving here would be cheaper. This is absolutely not true,” Modica said. “The rent in Salisbury is almost higher than in Raleigh.”
For now, Modica said she is living in an RV in the area until she can move elsewhere.
“Salisbury is not Raleigh, Charlotte or Chapel Hill,” Modica said. “They are able to charge so much rent due to location and lots of options for work and fun activities to do, and most allow pets.”
The Salisbury Community Development Corporation is a non-profit organization that focuses on providing affordable housing, promoting stable communities and improving homeownership opportunities for low to middle income families. The company is currently building two homes, one on the 500 block of Park Avenue and another on the 600 block of West Cemetery Street. These homes will be sold to families earning less than 80% of the region’s median income, or just under $42,000 per year in 2019.
Homes are generally sold at market price, but the CDC receives $50,000 in federal funding each year to help first-time home buyers with down payment assistance. This federal funding also caps the maximum asking price they can charge.
Salisbury CDC executive director Chanaka Yatawara said he was shocked to find a dozen new townhouses being built on West Cemetery listed on Zillow for more than $250,000.
“I’m shocked,” Yatawara said. “I feel like I’m in Charlotte.”
Although the CDC focuses on those with low to moderate incomes, Yatawara said the market still plays an important role in the work they do. It’s difficult for homebuyers to buy homes when multiple offers come in above the asking price but still aren’t accepted, he said. And rising construction costs are hurting CDC projects as they try to base their asking price on construction costs.
But the current low interest rates have also pushed prices up, Yatawara said.
Yatawara said the city needs more single-family homes.
“Otherwise they will leave Salisbury,” Yatawara said. “The city needs more young people to be able to settle and put down roots here.”
Salisbury resident George W. Benson, who sits on the Rowan County Board of Elections, said he had experienced a monthly rent increase of around $100. Salisbury needs more homes for people aged 55 and over who are on fixed and limited incomes, he said.
The city estimates about 500 new homes this year, with about 160 confirmed affordable homes and the potential for another 70. At least 270 market-priced homes will be available, with the potential for hundreds more. The outlook beyond 2022 could include an additional 1,600 housing units, which would be a mix of low-income and market-priced housing. In December, the city approved a project to redevelop a former Ford dealership on South Main Street to provide 64 affordable intergenerational housing units by 2023.