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Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Continuous Population Growth Fuels Housing Demand

The continuous population growth in the United States is fueling a strong demand for housing, particularly in thriving markets like Cary, North Carolina.

This surge in housing demand is driven by various factors, including the desire to live in certain cities, leading to higher rents.

Despite the challenges, Cary's growing population, coupled with its strong education levels and human capital, make it a worthwhile investment for real estate in 2024.

The housing market in the US is experiencing a complex dynamic, with risks rising on both sides.

Hot, growing markets like Cary are experiencing speculative booms and undersupply, while contracting markets are facing oversupply and slowdowns in house price appreciation.

This situation highlights the need for strategic investments and careful market analysis to navigate the evolving real estate landscape.

According to the UN, the world population is projected to reach 8 billion by 2050, and the demand for new homes is expected to reach 300 million by 2030, or roughly 21 million new homes per year.

This rapid population growth is a major driver of the housing shortage in many parts of the world.

A study by Freddie Mac found that the risks in the housing market are rising on both sides - in hot, growing markets, there is an undersupply leading to speculative booms, while in contracting markets, there is an oversupply leading to a slowdown in house price appreciation.

Household growth is a key factor fueling housing demand, with the acceleration being driven by a pickup in growth among millennials, who are now entering their prime homebuying years.

The Joint Center for Housing Studies has found that underlying demographic shifts, including growing diversity and changing age structure, are shaping the type, quantity, quality, and location of housing that is in demand.

Climate change, population growth, and power sector changes are also impacting energy demand, with heterogeneous city-scale building source energy use changes driven by population and power sector changes, highlighting the complex interplay between population growth and the built environment.

Despite the challenges, education levels and human capital are driving the demand for housing in Cary, North Carolina, making it a worthwhile investment in 2024, according to industry experts.

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Low Interest Rates Keep Mortgages Affordable

Mortgage rates, while elevated compared to recent years, have shown slight downward movements and are predicted to remain in the 7% range for the foreseeable future.

This keeps mortgages relatively affordable, creating an attractive environment for homebuyers and driving increased demand and home prices in markets like Cary.

However, experts caution that even a small drop in rates may still be a significant factor for some prospective homebuyers.

Mortgage rates in 2024 have shown a slight downward movement, after hitting a recent high of 22%, and are predicted to stay within the 7% range for the foreseeable future.

Despite the recent increases, mortgage rates in 2024 remain lower than the historical highs recorded in 2008, making mortgages still relatively affordable in many markets.

Refinancing from a fixed-rate mortgage to a lower adjustable-rate mortgage can provide immediate savings, but comes with the risk of potential future interest rate increases.

Low mortgage rates have created an attractive environment for homebuyers, driving increased demand and home prices in some areas, including Cary.

The Federal Reserve's interest rate hikes to combat inflation have also affected mortgage rates, leading to the recent slight downward movement.

Homeowners with mortgage rates below 5% are nearly twice as likely to want to hold onto their current home, while those with higher rates are more likely to sell.

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Median Home Prices Remain Relatively High

Despite elevated median home prices in Cary, the town continues to offer competitive housing affordability compared to other nearby areas.

Contributing factors include limited inventory, strong demand, and the town's thriving economy, diverse population, and high quality of life, which attract a range of homebuyers.

While median home prices in Cary remain relatively high, the town's strong fundamentals and desirability make it a worthwhile investment opportunity in 2024.

The median home price in Cary, North Carolina, currently stands at around $612,000, with an average sale price per square foot of $

The median home value in Cary has increased by 3% over the past year, with the average home sale price rising by 6% year-over-year.

Despite a slight decrease in median home prices since last year, homes in Cary are still selling quickly, with an average of 4 offers per home and a sale time of around 6 days.

The rising home prices in Cary are partly due to low interest rates and increasing demand, as people continue to look for homes despite the higher prices.

The limited inventory and competitive demand in Cary, coupled with strong economic fundamentals, contribute to the town's relatively high median home prices.

The median household income in Cary exceeds the state and national averages, supporting homeownership potential and making the town's housing market more affordable compared to other nearby areas.

Cary's suburban and exurban locations with established neighborhoods and amenities are attractive to homebuyers, further driving up the median home prices in the area.

The US housing market as a whole is experiencing price increases, with the median US home price reaching a record high of $383,725, up 52% year-over-year.

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Housing Costs Comprise Significant Portion of Income

Housing costs represent a significant burden for many residents in Cary, with over 19 million renter households spending more than 30% of their income on housing in 2021.

This housing cost burden is particularly acute for lower-income groups, with affordability being a top priority.

The surge in housing costs in Cary, with the median-priced home costing 60% more in 2023 than in 2015, has contributed to an increase in housing cost burden, posing financial strain for individuals and families.

In 2020, spending on housing consumed 31% of the median renter's income in the United States, far outweighing other expenditures as a proportion of household spending.

Lower-income respondents in Cary cited freedom as their primary reason for prioritizing housing affordability, highlighting the significant burden that housing costs place on this demographic.

A 1% increase in the housing cost-to-income ratio is associated with 1,502 additional deaths per 100,000 population, demonstrating the adverse health consequences of housing cost burden.

The median-priced home in Cary cost 60% more in 2023 than it did in 2015, contributing to the rise in housing cost burden for residents.

In 2022, half of renter households in the US spent more than 30% of their income on housing and utilities, a significant financial strain for individuals and families.

The gap between what buyers can afford and what homes sell for is nearly $73,000 in the San Francisco Bay Area, a prime example of the pronounced mismatch between income and home prices.

Strong-market affordability issues are driven by the cost of housing being bid up by demand from more affluent households, exacerbated by the high cost and difficulty of building in these areas.

The poorest families are the most affected by housing cost burden, with 87% of renter households earning under $10,000 per year and 67% of those earning $10,000 to $19,999 spending 50% or more of their gross income on housing.

According to Statista, housing costs far outweigh other expenditures as a proportion of household spending, highlighting the significant financial pressure that housing costs place on individuals and families.

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Precious Metals Offer Inflation Hedge and Safe Haven

Precious metals, such as gold, have long been considered a reliable hedge against inflation.

During times of economic uncertainty and rising prices, investors often turn to the relative stability of precious metals to safeguard their wealth.

However, the performance of precious metals as an inflation hedge has been inconsistent, with some studies suggesting they are more effective as a long-term store of value rather than a short-term inflation hedge.

The content focused solely on the role of precious metals in providing an inflation hedge and safe haven for investors.

Historically, gold has been considered a reliable hedge against inflation, with its value tending to rise during periods of high inflation.

However, recent studies have shown that its performance as an inflation hedge can be inconsistent over shorter time periods.

Silver, another popular precious metal, has outperformed gold as an inflation hedge over the past century, with its price increasing by an average of 2% per year more than the inflation rate.

Platinum, a lesser-known precious metal, has demonstrated a stronger correlation with inflation compared to gold, making it a potentially more effective inflation hedge for some investors.

The supply of precious metals is finite, as they cannot be easily manipulated by governments or central banks, unlike fiat currencies, which are susceptible to devaluation during periods of high inflation.

Precious metals, such as palladium, have industrial applications in the production of catalytic converters, electronics, and other high-tech products, which can further drive demand and support their value as a hedge against inflation.

Diversifying a portfolio with precious metals can help mitigate the impact of inflation, as they often exhibit low or negative correlations with other asset classes, such as stocks and bonds.

The performance of precious metals as an inflation hedge can be influenced by various factors, including global economic conditions, central bank policies, and geopolitical events, which can create volatility in their prices.

Precious metals exchange-traded funds (ETFs) have become increasingly popular as a way for investors to gain exposure to the precious metals market, offering greater liquidity and diversification compared to physical bullion ownership.

The recent surge in gold prices in 2023, driven by a combination of high inflation and geopolitical tensions, has reignited interest in precious metals as a safe haven investment.

Top 7 Reasons Why Cary Is Still a Worthwhile Investment in 2024 - Cash and CDs Offer High Returns and Liquidity

Cash and certificates of deposit (CDs) have emerged as attractive investment options in 2024, offering high returns amidst rising interest rates.

With CD rates reaching over 7%, these low-risk investments provide a viable alternative to traditional savings accounts, delivering guaranteed returns and liquidity.

The best CD rates have surpassed 7% in 2024, making them highly competitive compared to other low-risk investments.

A CD ladder strategy, where CDs of different maturity terms are distributed, can provide a balance between liquidity and returns.

The top CD rates currently offer returns significantly higher than high-yield savings accounts, which have struggled to keep up with the rising interest rate environment.

With interest rates expected to fluctuate, diversifying funds between a CD and a high-yield savings account can provide consistent cash flow and optimize returns.

CDs are considered a safe investment, as they are backed by the full faith and credit of the US government, making them a reliable option in uncertain economic times.

The recent Federal Reserve interest rate hikes have led to a substantial increase in CD yields, with some reaching levels not seen in over a decade.

Splitting investments between CDs and other assets, such as stocks or real estate, can create a balanced portfolio that capitalizes on the unique advantages of each asset class.

The liquidity offered by CDs allows investors to access their funds when needed, without incurring the penalties associated with early withdrawal from other investment vehicles.

The rise in CD rates has created a competitive landscape, with banks and credit unions vying to offer the highest yields to attract depositors.