Categories: Nags Head Real NC Estate News

Housing Crisis Hits the Outer Banks: A Local Perspective

The Outer Banks, renowned for their stunning beaches, face a pressing housing crisis affecting locals.

News Summary

The Outer Banks are facing a severe housing crisis, with skyrocketing costs and limited availability making it difficult for families to find homes. The demand for rentals has also surged, pushing prices beyond reach for many local workers. Efforts are underway to address these challenges and preserve the community’s vibrant culture.

Housing Crisis Hits the Outer Banks: A Local Perspective

The beautiful Outer Banks, known for its stunning beaches and relaxed lifestyle, is currently grappling with a pressing housing crisis that many locals are feeling the impacts of. Families looking for homes are discovering that the combination of skyrocketing costs and a severe shortage of available housing is making it harder than ever to find a place to call home.

Higher Costs and Limited Homes

Let’s break it down. Back in the fall of 2020, many families, including mine, were able to swoop in on the low interest rates and quick sales, allowing us to secure housing more easily. But fast forward to today, and things have taken a drastic turn. For example, if you’re a family of seven hunting for a new home, you’re now looking at a price tag of around $600,000 for a modest 2000 square foot house. Just three years ago, that would have felt like a distant dream for many.

The pandemic led to prices rising at an alarming rate. Currently, the most affordable homes—excluding condos and manufactured options—begin at approximately $375,000 for a two to three-bedroom property. If we factor in a 7% interest rate and a 20% down payment, the monthly mortgage payments can skyrocket to about $2,311. If a buyer can only muster a meager $5,000 for a down payment, that monthly payment jumps to an eye-watering $3,000, a burden that’s difficult for many families to shoulder.

Income Challenges

To afford this amount monthly, one would typically need to earn around $155,000 annually, based on a conservative 28% debt-to-income ratio. Yet, that’s a tall order for the average local. Educators in the area make approximately $35,000 a year, firefighters average $40,664, and police officers fare a bit better at about $53,802 annually. When you compare these salaries to the current housing market, it’s not hard to see why residents are feeling overwhelmed.

A Rental Market in Crisis

As if buying a home weren’t challenging enough, renting options have taken a hit as well. Just three years back, the average rental price for a two-bedroom home hovered around $1,500. Today, that same rental will run you over $2,000. Reports from local rental companies reveal a tight market with only minimal year-round rentals available. Demand is so high that some listings attract up to 50 inquiries within a short time frame.

The shift has led to some locals expressing frustration, particularly towards out-of-state vacation rental investors and Airbnb landlords who occupy properties that could otherwise serve long-term residents. With a growing number of homes being converted to short-term vacation rentals, the supply of long-term rental options continues to dwindle.

Efforts to Address the Shortage

6,500 members actively seeking rentals. Still, many desperate locals report a tough battle in securing homes, with some posting for housing assistance without success for up to a year. Small one-bedroom units often cost around $1,750, while two-bedroom units typically range from $2,000 to $2,500, with some even near $3,000!

Looking Towards Solutions

Recognizing the need for action, the Dare County Housing Task Force has formed to tackle these housing obstacles. Their focus is on ensuring that houses remain available for local workers instead of being snapped up for vacation rentals or second homes. New changes in Nags Head’s multifamily housing policies aim to promote long-term rentals, mandating that some units must be occupied by county employees and requiring leases of at least three months.

The Outer Banks is undeniably a special place, but as the housing market evolves, it’s critical that efforts are made to keep it accessible to those who live and work here. Without intervention, the attractive community that draws in tourists year after year may find itself at risk of losing its vibrant local culture—something that no one wants to see disappear.