Understanding the real estate boom in Chatham County

By Gene Galin

Pittsboro, NC – Chatham County is experiencing a significant transformation in its real estate landscape. This shift is driven by an influx of out-of-state residents, a booming job market, and evolving housing needs. The influx of residents from states like California and New York is creating a dynamic shift in the local market, characterized by sticker shock and a high demand for spacious homes and lots. In part 2 of a conversation I had with local real estate agent Eric Andrews, we delve into the multifaceted changes, examining why people are moving to Chatham County, the impact of new job opportunities, and the challenges and benefits of this rapid growth.

A New Wave of Residents

From California to North Carolina: A Tale of Sticker Shock

One of the most striking aspects of the current real estate market in Chatham County is the influx of residents from states with much higher property values, such as California and New York. For many of these new residents, the comparative affordability of homes in Chatham County is nothing short of astonishing. A 1,400 square foot home in California, often priced between $1.2 and $1.4 million, contrasts sharply with similarly sized homes in Chatham County, where such a sum can secure a considerably larger property. Eric noted, “They’re really blown away by how much house they can get compared to what they’re leaving in California.”

The allure extends beyond just price. Many newcomers are also enticed by the reduced commute times and the expansive lots available. In urban California, small lots are the norm, but in Chatham County, a one or two-acre lot is considered small. This abundance of space is a significant draw for those seeking more land for their investment.

Halfbacks and Regional Migrants

In addition to Californians, there is also a noticeable trend of “halfbacks” – people who initially moved from the northern states to Florida but are now relocating halfway back to places like North Carolina. These individuals often seek a more temperate climate and a balance of seasonal changes without the extremes of northern winters or Florida’s hurricanes and heat. North Carolina, with its moderate climate and four distinct seasons, offers an appealing middle ground.

Another major source of new residents comes from neighboring states and counties within North Carolina. Orange County, North Carolina, for example, has been a significant contributor to Chatham’s population growth, as people move from the more urbanized Raleigh-Durham area seeking more rural and spacious living conditions.

The Impact of Job Opportunities

Economic Drivers: Toyota and Wolfspeed

The burgeoning job market in Chatham County is another crucial factor fueling the real estate boom. Major companies such as Toyota and Wolfspeed have established significant operations in the region, attracting a highly skilled workforce and boosting the local economy. Toyota’s presence near Liberty and Wolfspeed’s expansive project on Highway 64 are bringing in not just jobs but also substantial investments in local infrastructure and housing.

As these companies expand, the demand for both rental properties and homes for purchase has skyrocketed. For instance, Wolfspeed employees have already had a notable impact on the local rental market, with no vacancies reported and a growing number of home sales attributed to these workers. The high-paying jobs offered by these companies mean that employees are often in a position to purchase more expensive properties, further driving up local real estate prices.

The Struggle for Affordable Housing

Despite the influx of wealth and the economic boom, there is a pressing need for affordable housing. The rapid development and rising property values are making it increasingly difficult for local workers, especially those in essential but lower-paying jobs, to find affordable homes. The local government and developers face the challenge of balancing growth with the need to maintain affordable housing options.

One of the significant barriers to affordable housing development in Chatham County is the availability of infrastructure, particularly water and sewer systems. In areas like Siler City, the lack of adequate sewer capacity has stalled new housing projects, exacerbating the housing shortage. While Pittsboro seems to be making progress in this area, it remains a critical issue that needs to be addressed to ensure sustainable growth.

The Price of Land and New Construction

Skyrocketing Land Prices

Land prices in Chatham County have seen a dramatic increase, driven by high demand and limited supply. The cost of a one-acre lot can range between $300,000 and $400,000, depending on its proximity to desirable locations like Jordan Lake. This price point makes it challenging for average buyers to afford land, pushing the market towards more expensive, high-end developments.

The sticker shock isn’t limited to those moving from other states; even local residents who have lived in the area for decades are finding it hard to cope with the rising prices. For many, the dream of buying a plot of land to build a home is becoming increasingly unattainable. The situation is particularly tough for younger generations, including those who grew up in the area and now wish to return.

The Shift Towards High-End Developments

New construction in Chatham County is increasingly skewed towards high-end, luxury homes. Neighborhoods featuring homes priced between $1.5 million and $3 million are becoming more common, especially in areas near natural attractions like Jordan Lake. These homes often boast large lots and premium features, catering to a wealthier clientele.

This shift towards luxury housing is partly driven by the demand from new residents who have sold expensive properties in other states and are looking to reinvest their wealth in Chatham County. However, it also reflects a broader trend in real estate development, where higher returns on investment can be achieved through high-end projects.

Balancing Growth and Preservation

The Role of the Unified Development Ordinance (UDO)

The planning board’s work on a proposed Unified Development Ordinance (UDO) in Chatham County aims to manage growth and development while preserving the rural character of the area. The UDO sets out regulations for zoning, land use, and development standards, aiming to strike a balance between encouraging economic growth and protecting the environment.

However, the UDO has sparked debate among residents and developers. While many appreciate its goals of preserving the county’s natural beauty and preventing urban sprawl, others argue that some of the regulations could inadvertently increase development costs, making housing even less affordable. For example, requirements for extensive landscaping and limitations on lot sizes can add significant costs to new developments.

Community Responses and Concerns

Local community members have voiced a range of opinions on the rapid changes taking place in Chatham County. Some residents welcome the economic opportunities and improved infrastructure that come with growth, while others are concerned about the potential loss of the county’s rural charm and the impact on local resources.

Eric Andrews, highlighted the difficulties faced by former students who wish to return to Chatham County but find it financially challenging. “A lot of people that want to move to the area are having to look at places like Sanford or Carthage where things are still cheaper,” he said. This sentiment echoes the broader concern about ensuring that Chatham County remains accessible to people from all walks of life.

Navigating the Future of Chatham County Real Estate

Chatham County is, experiencing unprecedented growth and change. The influx of new residents, driven by both economic opportunities and the allure of a more affordable, spacious lifestyle, is transforming the real estate market. While this growth brings many benefits, including increased economic activity and improved infrastructure, it also poses challenges, particularly in maintaining affordable housing and preserving the county’s rural character.

The future of Chatham County’s real estate market will depend on how well these challenges are managed. Ensuring a balanced approach to development, where economic growth does not come at the expense of affordability and environmental preservation, will be key. As the county continues to evolve, the voices of long-time residents, new arrivals, and local policymakers will all play crucial roles in shaping a sustainable and inclusive path forward.

Detailed Summary for Part 2 – State of real estate market in Chatham County – 5.17.24 by Merlin

Chatham County’s Real Estate Affected by California Migration & Toyota Impact – Insights on Growth & Job Opportunities.

00:14 Many people moving from high-cost areas to Chatham County for more affordable housing.

  • Specifically, a lot of people are moving from California, New Jersey, and New York to Chatham County.
  • People moving from California are impressed with the value they get for their money in Chatham County compared to their home state.

02:04 Proximity to coast and mountains driving growth in Chatham County

  • Chatham County offers a mild climate with access to the coast and mountains within three hours.
  • Presence of good paying jobs like Toyota is impacting the real estate market, with homes priced over $2 million.

03:42 Wolfspeed is aggressively building but lack of available new construction in Siler City is impacting workforce housing.

  • Wolfspeed’s building schedule is quick, but workers aren’t moving to Siler City due to lack of new construction.
  • Sewer issues in Siler City are delaying house construction, impacting the real estate market in Chatham County.

05:29 Chatham County offers more land compared to other areas.

  • 1. Chatham County has more land available than other areas like Wake County.
  • 2. Residents often consider a 1 or 2-acre lot small, which is much larger than in Cary.

07:12 Real estate market in Chatham County is competitive and prices vary based on location

  • a lot of people looking to move to the area are considering Sanford or Carthage due to cheaper prices
  • Properties near Jordan Lake or Army Corp land come at a premium due to privacy and lack of neighbors

08:58 Minimum lot sizes and prices for real estate in Chatham County.

  • Minimum lot size is 40,000 square feet with municipal water, otherwise 1.5 acres with well.
  • Neighborhood has $1.5 to $3 million homes, new construction prices going up.

10:45 Concerns over housing costs and rural preservation in Chatham County

  • Development regulations impacting affordable housing opportunities
  • Impact of UDO on the cost of development and potential focus on town growth

12:43 Balancing development with environmental preservation

  • Different issues in Western Chatham District versus northeastern part of the county
  • Considerations for preserving trees without pricing people out of the area