Raleigh and Cary Mayors Favor Slowdown in Growth
October 13th, 2007 Categories: Real Estate Market Trends, Real Estate News
We held local elections in Wake County this week and the two largest cities, Raleigh and Cary, both elected mayors who have publicly made it known they think growth needs to be slowed down. Incumbent Raleigh Mayor Charles Meeker and Cary’s new Mayor Harold Weinbrecht each ran on platforms that would seek to limit building and impose more stringent and expensive impact fees on developers home buyers.
If they get their way, home prices will be subjected to a great amount of upward price pressure in the days ahead. It’s foolish to think that any business, home builders and developers included, will simply pay for new fees and restrictions out of their profits. Look for home prices to rise, especially in new construction, if the changes are as punitive as these outspoken politicians lead us to believe they could be.
In addition to higher home prices from fees that are passed through to consumers, what about an artificially dampened supply due to restrictions and limits placed on building permits? Do you think such outspoken anti-growth mayors might try to reduce the number of permits issued?
As I’ve mentioned to you repeatedly on this blog over the past few weeks, inventory has risen to over 8,300 listings and the market still continues to absorb the increase with the absorption rate sitting at 4.9 months. Folks that’s a 26% increase in inventory and prices continue to rise with the average sell price up 8.4% from a year ago.
Government controls on supply cannot help but have a negative impact on what you will pay for your next home. It’s economics 101. Constriction in supply with strong demand will result in increased prices. And for all the wrong reasons.
The answer to congested roads and over crowded schools is not to wreck the local economy with government imposed sanctions on growth that is being demanded by the market. How about if we require accountability from our elected officials for the capital they already have in the coffers? We certainly don’t need to spend millions and millions on proposed public transportation systems that the federal government twice told Triangle Transit Authority was not feasible.
It just seems odd to me that as more people relocate to the Raleigh area and bring their tax dollars here with them that our leaders cannot structure a budget that allocates that money to the places it is needed. What do you think?
