Publisher's Note: This post appears here courtesy of the John Locke Foundation. The author of this post is Brittany Raymer.
Raleigh is experiencing a housing crisis. Rising apartment costs are currently outpacing inflation in the city, meaning that families are going to find it more and more difficult to afford housing. In fact, the median rise of a rental in North Carolina's capitol is more than $2,000.
As one of the most pro-business states in the nation, Raleigh is attracting some of the biggest companies in the world to set up shop, but that does have a cost.
Rents are rising across the city, faster than inflation can keep up. This is putting the squeeze on families, who are already struggling with higher grocery bills and pain at the pump.
According to a report from Redfin, of the nation's 50 most populous cities, Raleigh had the seventh highest year-over-year rent growth increase. The median price for an apartment in September was $2,030, up $287 from a year ago.
Home prices are also rising, with the average cost increasing by 14.1% in Wake Count and 12.1% in Johnson County. The rise in inflation, the growing burden of rentals and houses, in addition to a 7% interest rate, makes home purchases almost an impossible option now for families.
The inability to purchase a home makes it difficult for people to establish long-term.
"The rise in shelter costs is problematic both for policymakers as it's harder to mitigate these costs and they are slower to decelerate or decline,"
said Dr. Gerald Cohen in an interview with WRAL TechWire. He's the chief economist at the Kenan Institute. "Especially low-income households, as wages are still not keeping up with inflation."
Given the looming recession and the possibility of layoffs and an uncertain job market, the pressure of higher housing costs will no doubt be an additional burden.
Making housing more affordable for North Carolinians is important as the country heads towards an economic downturn. This is especially true as the state continues to attract more and more businesses.
A way to make construction easier and more cost effective, it's prudent to ease regulations to increase housing opportunities, especially for low-income families.
The John Locke Foundation is planning on hosting an Affordable Housing Symposium in December.