NC Unemployment Will Hurt North Carolina Housing Market

Posted on | July 15, 2009 | No Comments

A few months ago I wrote an article on the effects of the unemployment rate on the state of North Carolina.  I am now following that up by saying that NC unemployment will definitely hurt the North Carolina housing market.  In the spring, both the Raleigh and Charlotte housing markets got a little bit of a pop, but that looks to be rolling over now.  The all time high for the Raleigh market was shown in May of 2008 with a median home value of $252,000.  That has since come off and is now sitting at $245,000.  While this is minimal compared to most markets, the NC unemployment has yet to take its full effect.

The North Carolina unemployment rate was reported at a all time high of 11.1% for the month of May.  This is VERY bad news for current home owners.  No matter how resilient the NC housing market seems to be, unemployment is definitely going to have an effect on home prices.  If the unemployment rate stays above 10% for a long period of time, home prices in the state of North Carolina may see losses in excess of 20%.

Overall, most home owners in North Carolina have only seen minimal losses on their homes value.  Both the cities of Raleigh and Charlotte are less than 10% off the housing market top back in July of 2006.  Now that unemployment is hitting hard, we could see these two markets see a drastic decline.  The banking industry in Charlotte and the government jobs in Raleigh have held up these markets, but we will see what happens as unemployment increases.

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