"The three-bedroom Victorian-style home at 1139 Great Ridge Parkway looks nearly identical to when it was built in 2010. On paper it is unrecognizable.
The Chapel Hill, N.C., house is currently listed for $520,000, more than double what it first sold for in 2011. A buyer who puts 20% down would have a mortgage payment of about $2,800 at a 6.96% interest rate, nearly triple the monthly cost in 2011. Then add property taxes and insurance, both of which have risen sharply.
"We could never afford this house today," current owner Rachel Walker said.
Walker and her husband Brian bought the house in 2020 for $315,000 with a 3.75% mortgage rate. The price was a stretch then, but they knew the home would appreciate. They never imagined its value would rise by roughly two-thirds in under five years.
The dramatic change in value tells a story of home affordability across the country. Through three owners in 14 years, the house hasn't had major renovations or additions beyond a fresh coat of paint. Yet its rise in value, coupled with higher mortgage rates and inflation, made it harder to reach 1139 Great Ridge Parkway and addresses like it along the road to the American dream.
"The bar keeps getting higher and higher for what it takes to afford the typical home," said Daryl Fairweather, Redfin chief economist. "Many first-time buyers wish they could take a time machine back five years to when both prices and mortgage rates were significantly lower."
In January 2012, the household income required to afford the typical home in the U.S. was $39,223, according to Redfin. As of November 2024, home buyers need to earn $126,764, a 223% increase.
Here is the tale of the three-story home.
2011: A new home
Donna and Thomas Worcester bought 1139 Great Ridge Parkway as a spec home from the builder in 2011 for $250,000 in cash. They had sold their place in Chicago to retire in a region with a warmer climate.
The couple fell in love with its farmhouse features and hardwood floors. They appreciated the surrounding nature trails, the proximity to three universities and the lower property taxes.
The home's annual tax bill was about $1,777 at the time. By last year it had risen 57% to around $2,790, according to CoreLogic and county records. Taxes jumped by about 23% in 2021 alone, when the county reappraised the property.
The Worcesters recall paying about $130 a month in homeowner's association dues.
Donna, a master gardener, created a plot in the backyard with native shrubs and perennials. She felt reassured that many of their neighbors worked for the surrounding hospitals.
"I liked to joke that if one of us ever had a medical emergency, I could just shout out our door and one of our doctor or nurse neighbors would come running to help," Donna said.
But over time, the couple worried that the stairs to the third floor of the home would be too steep for their aging knees. They sold the home to an institutional buyer in 2015 for $270,000 in cash, netting a few thousand dollars of profit after real-estate commissions. The Worcesters moved about 15 minutes away and built a single-story home.
Despite the home's subsequent rise in value, they have no regrets, partly because they didn't want to be landlords.
'It's a charming house in a good location," Donna said.
2015: For rent
Nearly a third of single-family-home sales are made to investors. Most are mom-and-pop landlords, but institutional investors account for more than 1%, according to CoreLogic.
Invitation Homes, a major owner and manager of single-family homes, bought the Worcesters' house in 2015 and rented it out soon after, according to a spokeswoman from the company.
Invitation Homes sold the home in 2020, in part because of HOA rules of that community.
Much appreciated
Rachel and Brian Walker were relieved when they found 1139 Great Ridge Parkway after being outbid on several other homes in the area. The newlyweds were determined to move into the Briar Chapel community so Rachel's son could continue high school in the same district where his biological father lived.
The house they bought for $315,000 became their haven, especially during the challenging times of the pandemic. The screened-in back deck is a favorite spot, allowing them to enjoy nature without pesky mosquitoes. Each family member found their own space to work, study and relax, with the third floor becoming Rachel's personal retreat for remote work.
The Walkers made no major renovations or improvements, except for the $10,000 they recently spent to paint the exterior of the home forest green.
The Walkers are benefiting the most from the home's appreciation as the biggest jump in value happened during their ownership. They are asking $520,000 with a $5,000 concession.
"I will deeply miss bird-watching, pink sunsets, our garden and the warm community we were a part of," Rachel said.
The Walkers are hoping they'll find a buyer soon. They are building a house near the beach and are counting on some of the proceeds to allow them to take out a smaller mortgage on the new house.
"We'll miss the house and our low mortgage rate," Rachel said." [1]
1. Ballooning Costs
Hit American Dream --- A home that more than doubled in value since
2011 highlights affordability woe: 'We could never afford this house
today'. Dagher, Veronica. Wall Street Journal, Eastern edition; New York, N.Y.. 29 Jan 2025: A10.
