If you’re in the market to buy a home, where do you get the most bang for your buck?
In 2015, the average closing price for a home sold in Orange County was $342,172, according to Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson. “This is a new high since (before) the recession,” he says.
2007, right before the housing crisis, was the only year in history that Orange County saw higher home prices – and if current trends continue, the county will break that record in 2016.
But what are the numbers underneath those numbers? How does the price of housing in Orange County compare with other counties in the area? If there’s a difference, what’s driving the difference? And is that difference growing, or shrinking?
Start with the average cost of a home. $342,000 is a lot to pay for a house – compare that to Durham County, where the average closing price was just over $200,000 in 2015. But Orange County is not number one, not anymore: closing prices are actually higher in Chatham.
“Chatham County peaked above Orange County for the first time last year,” Nelson says, “and (it) remains in that slot.”
In 2015, the average home buyer in Chatham County paid $359,000 for their house, $17,000 more than they did in Orange.
But that doesn’t necessarily mean Orange County is offering a better value: Nelson says Chatham County houses are more expensive partly because they’re bigger. In terms of the cost of housing per square foot, Orange County is still the priciest: $142 per square foot, versus $138 in Chatham.
And if you want a home in the Chapel Hill-Carrboro school district, you’re going to pay even more. Last year, the average home in Chapel Hill-Carrboro sold for more than $382,000, or $157 per square foot.
(Compare that to $107 per square foot in Durham.)
“Housing in Chapel Hill is 30 percent more per square foot in the district than it is in Durham,” Nelson says. “So that 3,000-square foot home – the same home – costs 30 percent more.”
So if you’re in the market for a new house, you can get a much better value in Durham – and a slightly better value in Chatham – than you can get in Orange County or Chapel Hill.
But there are signs that this may be changing. In Chatham County, the cost per square foot has gone up dramatically – nearly 10 percent in the last two years. In Durham it’s gone up about 6 percent.
In Orange County, though, exactly the opposite has occurred. “For the first time,” Nelson says, “last year we saw a slight decline.”
For the average home sold in Orange County, the cost per square foot actually dropped by 4.7 percent from 2013 to 2015.
So the value gap may be narrowing between Orange County and its neighbors.
But is that necessarily good?
“If you’re an affordable housing advocate, you are heartened by this information,” Nelson says, “(but) if you’re worried about the erosion of home value, you are concerned.”
The cost of housing in Chatham County is on the rise partly because it’s bigger – and partly because it’s newer. The same is true for Wake and Durham. The housing stock in Orange County, by contrast, tends to be significantly older – and that may be contributing to the decline in cost per square foot.
And the cost of the home itself is not the only factor when it comes to housing value. Don’t forget about taxes, Nelson says: “A $300,000 house in Orange County has a $150-a-month higher tax bill than the same house in Wake County.”
If you’re looking to get a mortgage, Nelson says that translates into about $28,000. “You can buy a slightly more expensive home in other markets,” he says, “so the taxes do impact our cost of housing.”
All of those numbers, Nelson says, are things that homebuyers do consider when it comes to making the decision to live – or not to live – in Orange County.
Nelson made those comments and delivered those statistics at his annual State of the Community Report, last week at the Friday Center.
We know that Orange County’s population is growing, and that’s a fact that has some local folks concerned: concerned that we’re getting too dense, that we’re losing our small-town character, or that we’re getting too big for our infrastructure to manage.
But how fast is Orange County really growing? How does our growth compare to our peer communities? And where is that growth actually coming from?
“The story I’ve been telling myself is that people are moving here, that they’re coming to us from Florida and Ohio and the Northeast – but that’s not what’s happening,” says Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson. “Our domestic migration is actually negative.”
What does that mean? “More people move out of Orange County into the (rest of the) US than move into Orange County from the US,” Nelson says.
He’s citing numbers from the U.S. Census Bureau. In the year 2014, Orange County’s population grew by an estimated 1,055 people – but that growth did not come from people moving to Chapel Hill from other parts of the country.
Where did it come from? Immigration, as it turns out. About 800 new immigrants settled in Orange County in 2014, most of them either from Asia or elsewhere in North America. Nelson says that accounts for a little more than half of our population growth.
The rest of our growth is natural: 1,269 people were born in Orange County that year, while 738 people died. That’s a net population gain of more than 500, without anyone moving in or out.
“So we have to be aware that some of (our population growth) is somewhat beyond our control,” Nelson says.
In fact the census numbers suggest that most of Orange County’s population growth is not driven by our local policy choices. It’s partly a product of birth rates, partly a product of international trends. (And a lot of the rest is regional: “The Triangle has been growing wildly,” Nelson observes.)
But how fast is Orange County growing, anyway?
In the 2000s, our population grew from 118,245 to 133,801 – that’s an increase of more than 15,000 people in one decade alone.
Which sounds like a lot – until you look back at the 1990s, when Orange County added nearly 25,000 new people.
“In fact,” Nelson says, “the 2000s are the slowest decade of growth in Orange County since the 1960s.”
Nelson says Orange County’s growth has actually slowed down in the last 15 years – not just in real numbers, but also (and especially) in terms of percentage.
“This is the lowest-percentage population growth that we’ve had since the 1930s,” he says.
According to the Census Bureau, Orange County’s population grew by only 9 percent in the 1930s, but it grew by at least 20 percent every decade since – until the 2000s, when we saw only 13 percent growth. (So far this decade, we’re on track to grow about 12.5 percent.)
Compare that to Chatham County, which saw its population grow by about 28 percent in each of the last two decades.
Still, Nelson says, those numbers do add up. Chapel Hill’s population today sits at about 60,000, twice what it was in 1980; by 2050 it’s projected to double again, to nearly 114,000.
And that’s not all. By 2050, Carrboro’s population will jump from less than 20,000 to more than 50,000; Hillsborough will double from 6,000 to 12,000. Mebane will skyrocket from less than 2,000 people today to more than 42,000 by midcentury – and that’s just the corner of Mebane that’s in Orange County.
Those numbers are daunting. But how will it feel? Nelson says to get a sense of what that population will be like, we need to look at population density.
And there, he says, we actually do have some room to grow before we start feeling crowded. Durham and Wake Counties, for instance, are currently about three times as dense as Orange, because Orange County is more rural.
But even when it comes to the cities, Chapel Hill and Carrboro, Nelson says there’s still plenty of room to grow. At about 3,000 people per square mile, Carrboro is the densest town in North Carolina, and Chapel Hill’s not far behind at about 2,700 per square mile – but many of our peer communities outside the state are considerably more dense than we are. Charlottesville, Virginia, Burlington, Vermont, and Ann Arbor, Michigan, for instance, are all above 4,000 people per square mile.
“And I think we admire many of those as places we think are beautiful and wonderful,” Nelson says.
Chapel Hill’s population density isn’t projected to hit 4,000 until at least 2030 – and even then, we’ll be no denser than Charlottesville is today.
(Which isn’t to say that we won’t have difficulty accommodating all those new people – but there are model cities around the country that show us it won’t be impossible.)http://chapelboro.com/featured/how-fast-is-orange-county-really-growing
This probably won’t come as a huge surprise – but the amount of money that’s spent by Orange County residents exceeds the amount of money that’s actually spent in Orange County.
That’s a phenomenon with a technical term: it’s called a “retail gap.”
Delivering his annual “State of the Community” report this week at the Friday Center, Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson said Orange County has a retail gap partly because we haven’t gone out of our way to bring in major retailers. “Retail is something that we’ve not historically recruited in our market,” he said, because “it generally (offers) low-wage jobs, and we’ve been thinking about (recruiting higher-paid) jobs.”
But that means a lot of the big retail centers are outside county lines – think Tanger Outlets in Alamance County, New Hope Commons and Southpoint in Durham County, and the new Walmart in Chatham. Orange County residents often leave the county to spend their money – and while other people do come to Orange County to shop and eat (especially to eat!), it’s not enough to make up the difference.
How big is Orange County’s retail gap? Citing figures from the NC Department of Commerce, Nelson says Orange County residents spent about 1.8 billion dollars in 2014, but Orange County saw less than a billion dollars in retail sales. That’s a “retail gap” of 866 million dollars in a single year, far more than any other county in our area.
And Nelson says while other nearby counties have been reducing or eliminating their retail gaps, Orange County’s has been growing.
Nelson said a growing retail gap is a sign that Orange County could still use more retail development – the better to increase sales tax revenue.
But there are also signs that sales tax revenue is already on the rise. According to the NC Department of Revenue, Orange County saw a 36 percent increase in sales tax revenue per capita in just one year, 2013.
Orange County now ranks 42nd out of North Carolina’s 100 counties in sales tax revenue per capita; prior to 2013, Orange County hadn’t cracked the top 60 in years.
Orange County is one of the wealthiest counties in North Carolina, but poverty is still a major issue.
How widespread is it?
“3,820 children in Orange County live in poverty,” says Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson, quoting numbers from the U.S. Census Bureau. “That’s a lot of children waking up in one of the richest counties in the state of North Carolina, in poverty.”
As of 2013, the latest available data, about 3800 Orange County children were living in poverty – about 13.4 percent of all Orange County kids. On the plus side, that’s down from a peak of 4800, or 17.4 percent, at the height of the recession in 2010.
“We’ve been bending down, and that’s really good news,” says Nelson.
But not every measure of childhood poverty is trending down. Nelson says the percentage of students receiving free and reduced lunch is still on the rise, in both of Orange County’s school districts.
“Orange County Schools (is) at 43 percent, up from 32 percent in 2006-07, (and) Chapel Hill-Carrboro City Schools is also on the increase, from 21 to 28.2 percent,” he says. “This number is not showing that trend down in poverty.”
And while the number of families receiving food and nutrition services (food stamps) is down slightly, it’s still significantly higher than it was even in the midst of the recession. 6,087 Orange County families receive food stamps today – down from a peak of 6,533 in 2013, but virtually unchanged from four years ago and well up from 4600 in the middle of 2010.
“The recession is long over, and yet this number (has) continued to grow,” Nelson says.
Nelson says the recent decline is good news, but the long-term trend is still sobering. In 2007, prior to the recession, only 2,900 Orange County families received food stamps. That number has more than doubled.
Orange County’s overall poverty rate is 15.5 percent, slightly below the 17.9 percent rate for the state as a whole – and surprisingly, more than 23 percent of Chapel Hillians live in poverty. Nelson says the student population skews that data a bit, but “I don’t want to discount that we do have poor students too, who really are struggling to make their way through college or community college.”
And he says the percentage of children living in poverty is a reminder that this is a very real issue in our community, students or no students.
Nor is a decline in poverty necessarily an entirely good thing. Nelson says there’s a correlation between the improving economy and the drop in poverty – but correlation does not equal causation. Is Orange County’s childhood poverty rate declining because poor families are moving out of poverty? Or is it because poor families are simply moving out of Orange County?
Nelson says it’s not clear. But there is one more troubling statistic. In the year 2000, according to the Urban Institute, there were 1,839 housing units in Orange County that were available for “extremely low income” households – or households making less than 30 percent of the county’s median income. At the time, Orange County had about 6,000 households fitting that description.
As of 2013, Orange County still had about 6,000 “extremely low income” households – but the number of available housing units had dropped almost in half, from more than 1800 down to 1,022.
Nelson says we’re seeing that trend in every county in the region.
“And I did some math – do you know what your wage is if you make minimum wage, working 40 hours a week, 52 weeks a year, you never take a vacation or a sick day?” he says. “It’s $16,500.”
Thirty percent of Orange County’s median income is $20,300 – so there are about six thousand households in Orange County making less than or barely over minimum wage (some of them students but not all), and the number of available housing units for those families has been shrinking rapidly for more than a decade.
Nelson made those comments last month, delivering his annual State of the Community report.
For years, local policymakers have been trying to create opportunities for people who live in Orange County to work in Orange County – and for people who work in Orange County to live here too.
But every day, thousands of Orange County residents get in their cars and drive to work somewhere else – and thousands of people who live somewhere else get in their cars and drive to work here.
“40,000 people drive into Orange County every morning, 37,800 people drive out of Orange County every morning – and (only) 19,000 folks wake up and work in Orange County,” says Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson.
And he adds that the number of people both living and working in Orange County has been trending downward for more than a decade. “45 percent of (Orange County residents) in 2002 lived here and worked here,” he says. “That’s down now to 34 percent.”
Among other things, Nelson says, this poses a challenge for our transit plan.
“We’ve designed an entire transit system to move people within our community,” he says. “If we’re more regionally employed, what is that going to mean for our transportation solutions?”
And while we often assume that people who commute into Orange County do so because they can’t afford to live here, Nelson says that may actually not be the case.
“We (think) we’re exporting high-wage white-collar workers and importing unskilled, semi-skilled work – but it’s not true,” he says. “19,000 people drive out for a job that pays $40,000 or more – and 19,500 people drive in for a job that pays $40,000 or more. We have 6,800 people driving out for a job that pays less than $15,000 – and we have almost the exact same number of people driving in (for similar-paying jobs).
“When we look at these as percentages, they’re really – shockingly – the same.”
What that means, Nelson says, is that addressing this issue may not be simply a matter of building more low-cost housing – it might also be about making connections.
“We must better connect local workers with local work opportunity, and that will dramatically change our in- and out-commute,” he says. “If we can specifically try to employ folks that live in our market, that will have great positive change – for the environment, for the lack of civic participation that happens when we commute, and the roads that we have to build and the transit system.”
And Nelson says it’s especially important to start making those connections now – because this trend, fewer and fewer people living and working in Orange County, is especially pronounced among residents under 30.
“There are 600 fewer young people – 15 percent fewer young people – living and working in our community over a two-year period,” he says. “That’s a trend I do not like.”
Nelson made those comments last month while delivering his annual State of the Community report.
Orange County is one of the richest counties in North Carolina in terms of per capita income, but we perennially rank near the bottom when it comes to retail sales and sales tax revenue.
But there are some indications that this may be starting to change: “Our taxable sales are now $1.47 billion,” said Aaron Nelson, president of the Chapel Hill-Carrboro Chamber of Commerce, during his annual “State of the Community” report Thursday at the Friday Center.
According to numbers from the state Department of Revenue, taxable sales in Orange County topped a billion dollars for the first time in fiscal year 2011 and have risen steadily since – topping $1.4 billion in fiscal year 2014 and reaching nearly $1.5 billion in the last fiscal year. That led to a spike in sales tax revenue – breaking $70 million in the last fiscal year for the first time ever, up from just over $50 million three years ago.
That’s a big shift. In 2012, despite being no. 2 in the state in per capita income, Orange County ranked 81st in per capita sales tax revenue. But in 2013, just a year later, Orange County ranked 42nd – moving past Wake, Alamance, and Chatham in the process.
“So around our office there were double-high fives, there was chest bumping – it was really exciting,” Nelson said.
But he says that number is a bit deceiving – because it’s not all about greater retail sales. “The revenue went up because we added a half-cent tax and a quarter-cent tax,” he said – and those tax increases added to the spike, along with the actual increase in sales. (Together, Orange County collected about $9.2 million from the half-cent and quarter-cent taxes in fiscal year 2015 – accounting for a little less than half of the $20 million increase in revenue from fiscal year 2012.)
Still, Nelson says the change is a promising sign that Orange County is making progress on an issue that’s troubled local policymakers and business leaders for many years – even if the issue still remains.
We’ll have many more numbers from Nelson’s State of the Community address on WCHL and Chapelboro.com in the coming days.http://chapelboro.com/news/business/sales-tax-revenue-up-in-oc-but-why
Nelson and Chamber board chair Paige Zinn at Tuesday’s presentation. Photo by Donn Young, courtesy Orange County Visitors Bureau.
CHAPEL HILL – Town and county officials have talked for years about making Orange County a place where people can “live, work and play” all in one location—but despite the effort, recent data show we’re still more of a bedroom community than county planners would like.
“Every morning 43,000 people wake up outside of Orange County and drive in, and every morning 39,000 wake up in Orange County and drive out–and only 21,000 people wake up and work in Orange County,” says Aaron Nelson, president of the Chapel Hill-Carrboro Chamber of Commerce.
In all, about two-thirds of those who work in Orange County live outside the county lines—and about two-thirds of Orange County residents leave the county to work. Those percentages have been steadily increasing for at least a decade—and Nelson says it’s putting a strain on the roads.
“The transportation planners should be really concerned,” says Nelson. “The challenge is (that) we have one of the best transit systems in the nation, but these people live outside that transit service area. They’re (using) park-and-ride lots, they’re driving in from all sorts of other places.”
The trend even extends to municipal employees: as of 2010, only 22 percent of those who work for the Town of Chapel Hill actually live in the Town of Chapel Hill. (That’s down from 41 percent in 1995.)
The most obvious would-be explanation for all the migration is simple economics: the cost of living in Orange County is high, so presumably people with low-paying jobs in Orange County have to live elsewhere, while residents of the county commute to higher-paying jobs in other parts of the Triangle. Nelson says that’s what he thought too—but the numbers actually say otherwise.
“Now, I had believed–and had even used the rhetorical ‘hey, it’s BMW out and Oldsmobile in’–that we had been importing our unskilled and semi-skilled labor and we were sending out our white-collar workers in order to work in the (Research Triangle) Park,” he says. “(But) that is not what is happening.”
In fact—contrary to popular belief—the number of individuals commuting into town for jobs paying more than $40,000 is nearly identical to the number of individuals commuting out of town for jobs paying more than $40,000. And the same is also true for jobs paying between $15,000 and $40,000, as well as jobs paying less than $15,000.
“So the disconnect between worker and work opportunity is not about wage,” Nelson concludes. “Some of it’s just about work opportunity. Adding work opportunity in any of these ranges will lower the commute.”
Interestingly, despite the increase in the percentage of people who drive into and out of Orange County for work, the average commute time has remained fairly steady for the last five years: Orange County residents in 2011 spent an average of 21.9 minutes to get to work—up only slightly from 21.4 minutes in 2007. (The average American’s commute is 25.4 minutes.)
Nelson delivered these numbers on Tuesday at the Friday Center, as part of his annual State of the Community report. You can see the whole presentation at this link.http://chapelboro.com/news/business/transit-planners-should-be-concerned-about-long-commutes
Aaron Nelson and Chamber board chair Paige Zinn at the State of the Community meeting. Photo by Donn Young, courtesy Orange County Visitors Bureau.
CHAPEL HILL – Orange County is the wealthiest county in the state of North Carolina—but the steady flow of money outside county lines continues to be a cause for concern.
“Per capita income is the highest (and) unemployment is the lowest in the state, but we still have this huge retail gap,” said Aaron Nelson, president of the Chapel Hill-Carrboro Chamber of Commerce, presenting data Tuesday at his annual State of the Community report.
The “retail gap” refers to the difference between the amount of money spent by Orange County residents each year and the amount of money that’s actually spent in Orange County.
According to the state Department of Commerce, Orange County residents spent about $1.68 billion dollars last year alone—but retail sales in Orange County were less than $1 billion.
“The gap in Orange County is $728 million” in 2012, says Nelson. “Making gains on this will have (a) huge impact.”
That $728 million gap is nearly twice that of Durham County ($376 million) and more than three times the retail gap of Chatham County ($236 million). And Alamance County—thanks in part to Tanger Outlets—actually has a $154 million retail surplus. Nelson says that gap helps explain why Orange County—number one in the state in per capita income—ranks only 65th in terms of sales tax revenue.
And he says eliminating that gap—or at least reducing it—will go a long way toward easing the tax burden on local property owners. About 87 percent of Orange County’s taxable land is residential property (compared to just 60 percent in Durham), which means the county’s property tax burden will always fall most heavily on homeowners. Nelson says that number’s not going to change—so the key is to generate more sales tax revenue from the commercial property we have, so as to be less reliant on property taxes as a whole.
“We should stop focusing on (and) beating ourselves about that split between residential and commercial,” he says. “We need to use that to remind ourselves (that) we’ve got to grow revenue from commercial sources.”
And Nelson also says Orange County can ease its burden by taking steps to reduce “wealth migration,” the amount of income that leaves the county whenever people move. Not surprisingly, Orange County draws in wealth from all over the country—but when it comes to our neighboring counties, there’s a lot more money leaving Orange County than coming in.
“The biggest outflow is $179 million worth of wealth…moving to Chatham County,” says Nelson. “The second highest amount was to Alamance County, $86 million, (and) Durham County, $83 million…Wealth migration has had a negative impact on Orange County, but a positive impact on our neighbors.”
Those numbers cover the period from 1992-2010; in that span, Orange County suffered a net wealth-migration loss of nearly $50 million in gross income. (All of that loss came in the last nine years; until 2001 Orange County was gaining more than it was losing.)
Nelson delivered his State of the Community report on Tuesday at the Friday Center. You can see the full presentation at this link.http://chapelboro.com/news/business/chamber-orange-county-tax-base-falling-into-retail-gap
Aaron Nelson and Chamber board chair Paige Zinn. Photo by Donn Young, courtesy of the Orange County Visitors Bureau.
CHAPEL HILL – Year after year, Orange County consistently ranks as the wealthiest in the state of North Carolina—but poverty, even here, continues to be a nagging and serious issue.
“There’s a big disparity between wealth, (and) there continues to be growth in childhood poverty,” said Chapel Hill-Carrboro Chamber of Commerce president Aaron Nelson at his annual State of the Community presentation this week. “That is (a statistic) that we need to pay close attention to.”
Orange County ranks first in the state with a per capita income of $48,683 in 2011, well above the state average of $36,000. But in spite of that, our poverty rate is also well above the state average: in 2011, 16.9 percent of Orange County residents were living below the poverty line, compared to 16.1 percent of all North Carolinians (and 14.3 percent of all Americans). The percentage is even higher in Chapel Hill alone, where 22.1 percent of residents lived below the poverty line in 2011.
“Some folks have often discounted that–(because they think) that’s just the student population…but our poverty level is high,” Nelson says. “We ought not to discount it simply because it includes students.”
For the first time, researchers this year were able to distinguish between students and non-students when analyzing wealth and poverty in the area. Students do account for much of the poverty rate in Chapel Hill—but that poverty rate is still elevated even when they’re taken out of the equation. About ten percent of Chapel Hill’s non-student population lives below the poverty line—a poverty rate that’s less than the state average, but still more than twice as high as nearby communities like Apex and Cary.
And the poverty rate increases when the focus is narrowed to children. “That is on the rise,” says Nelson, “and in a pretty serious way.”
The key increase is in the percentage of “economically disadvantaged” children, which is to say children who qualify for free and reduced lunch. 26.5 percent of Chapel Hill-Carrboro City School students and 41.6 percent of Orange County School students qualified for free and reduced lunch in 2011-12—the highest percentage in both districts since at least 2006, when the Chamber began collecting data.
And the high level of need in Orange County is at odds with the common perception of Chapel Hill as a wealthy community—a disconnect that actually makes it harder for governmental and non-governmental organizations to address the real need that exists.
“(It’s called) ‘Chapel Hill Syndrome,'” Nelson says. “Donors get this: it’s a belief that we don’t need anything, Orange County doesn’t need anything–we have the highest per capita income, the University’s there, the hospital’s there, your economy’s bulletproof–but the reality is that some of us feel that way and forget to reinvest and take a look under the rocks on what’s going on in our community with respect to poverty, particularly children in poverty.”
Nelson delivered his State of the Community report on Tuesday at the Friday Center. You can see the full presentation at this link.http://chapelboro.com/news/business/orange-county-wealthy-on-average-but-poverty-still-lingers
Aaron Nelson and Chamber board chair Paige Zinn compare notes before the State of the Community presentation. (Photo by Donn Young, courtesy of the Orange County Visitors Bureau.)
As the country, the state and the region pull slowly out of recession, the state of our community is strong — but still could stand to get stronger, particularly when it comes to housing.
That was the takeaway from the Chapel Hill-Carrboro Chamber of Commerce’s sixth annual State of the Community report, delivered at the Friday Center on Tuesday by Chamber president Aaron Nelson.
“(We have a) strong, educated workforce (that’s) increasingly diverse,” he says. “Our economy and community are resilent — we were late into this recession and we were first out — and many of those indicators look good.”
Generally speaking, Orange County ranks among the best in the state in most indicators of social wellbeing, from educational achievement to the crime rate to public health. Fittingly, though — for a region so often concerned about its perceived status as a ‘bedroom community’ — many of the more worrying statistics relate to movement.
“We are growing, and we will still grow…(and) we’ve got to figure out where these folks are going to live,” Nelson says. Orange County’s population in 2012 was just shy of 138,000, up 22,000 from the turn of the century — and by 2025 Orange County is projected to add another 30,000 residents, for a total of more than 166,000.
“That’s a lot of folks,” Nelson says. “Let me give you some perspective: 140 West Franklin downtown, the big tall thing, that holds 300 people. I just said 30,000.”
And the local housing market is struggling to keep up — a fact that’s contributing to the already-high cost of renting and buying homes.
More than half of all housing units in Chapel Hill are occupied by renters — in Carrboro it’s more than 60 percent — and affordable housing remains persistently scarce. More than half of all renters in Orange County now pay more than 35 percent of their income in rent, well above the “affordability” threshold.
“The rental market is growing, but the lack of supply is driving (the) rate,” Nelson says. “This huge increase in those rates — folks are moving into our community and (adding) pressure.”
And the cost of homeownership remains elevated as well. Nelson says the average closing price for an Orange County home has dropped slightly from its peak in 2010 — it’s now about $319,000, down from $330,000 — but that’s still far pricier than an average home in our neighboring counties, and it’s not just because the houses are bigger.
“The price per square foot in our market is dramatically higher,” Nelson says. “(It’s) $134 a square foot (in Orange County)…in Chapel Hill city limits it’s $180 a square foot. That’s — my editorial comment — a supply challenge, because folks are able to build it in Durham for $93 a square foot.”
Compounding the housing crunch, of course, is the demand coming from UNC: of the 29,000-plus students at UNC-Chapel Hill, 63 percent live off campus—more than 18,000 in total, all seeking housing in and around Orange County. That’s already caused some controversy in the Northside and Pine Knolls neighborhoods, both very near campus—where Town officials have had to step in to address parking concerns, and longtime residents have been driven out by the rising cost of housing (and the resulting property tax hike) that came with the increased demand.
But Nelson says it could be worse: in fact, 55 percent of UNC’s undergrads live on campus, a far higher percentage than many of UNC’s peer institutions. (At Indiana University, for instance—in the Chapel Hill-esque town of Bloomington—only 40 percent of undergrads live on campus.)
And there are also several housing projects currently in the works near downtown that are specifically geared for students—a development that Nelson says will also go a long way toward alleviating the problem of affordable workforce housing as well.
“(In) my view, the greatest growth of workforce housing, workforce rental, has been new student rental,” Nelson says. “If you go back in time (and) take a look at all the apartments that were student apartments in the late 1990s, early 2000s — when new student housing got built, students moved to that, and what was backfilled into the old student housing was workforce housing.”
Still, with 30,000 more residents projected to move into Orange County in the next twelve years, the housing crunch is not likely to go away anytime soon—and Nelson says that’ll be the case across the entire Triangle, where half a million more residents are expected to flock in by 2025.
We’ll have more from the Chamber’s State of the Community report throughout the week, but you can see the entire presentation for yourself at this link.http://chapelboro.com/news/development/in-orange-county-housing-crunch-is-here-to-stay