2 min read October 2023 — In an interview, Jim Allen, president of the Jim Allen Group, talked about the Triangle area’s strengths and how those lead to robust job creation. The real estate market remains strong, with increased interest in affordable housing, open concepts and customizations, Allen explained to Invest:.
What have been some milestones for the company over the past year and what are your differentiators?
We were named the No. 1 team for Coldwell Banker in the United States and we are ranked 14th internationally by RealTrends. We are competing with teams of 1,000 but we are able to get that ranking with just 60 members.
In terms of differentiators, we are trying to provide a consistent experience to everyone who works with us, so rather than having agents who lack experience in closing patterns or who may not know how to write well to enter listings correctly, we have hired professionals to do each portion of the actual transaction so that agents focus on client representation and making clients comfortable.
What are the main strengths of the Triangle area?
Our biggest strengths are the industries that are here because we have some of the most diverse industries in the country. The high-tech sector gets all the news but we also have car manufacturing, Amazon distribution centers, IBM and so on. At RTP alone, we have over 100 different corporations. There are another 100 at Centennial Campus that all have their worldwide headquarters here. We have about 40,000 new jobs being created currently, so our biggest challenge is providing housing for those people. For that reason, we have become a popular investment area for investors looking to purchase either rental resources or build apartments.
How is the economic landscape impacting development?
Prices are continuing to increase and we have bidding wars for homes hitting the market. The reality is that consumers have adjusted to the interest rate change and now we are at more solid rates. For the last 40 years, the average interest rate everywhere has been 7.8% and we are still under that. There was simply a four-year period of time where interest rates were too low.
In terms of inflation, it is being caused by scarcity right now. When you do not have enough of something, prices will continue to climb and that is still happening with housing. Our population continues to grow but we have less housing available than we ever have.
I don’t believe the economy is impacting us locally at all because we have so much job creation and people entering the workforce, so from a real estate perspective, it is not impacting us.
What are some of the current housing trends you are seeing?
Affordability is the biggest thing people are considering at the moment. We are still seeing open concepts trending and we are starting to see more and more people rehabilitate homes. People are fixing them up and improving the properties they are in because, while they can sell for more than they have ever dreamed, they do not have a place to move to. In terms of what people are looking for, they are looking for better finishes and want to have more customizations.
Are there any significant developments in the pipeline?
I am developing about 1,100 lots that will come online over the next year. It will be a drop in the bucket in terms of what the market needs, but we are supplying a lot within multiple different price points and in areas that we have previously not touched to get prices below $400,000, which currently does not exist. We are also developing multiple neighborhoods that produce housing in the $800,000 – $1.8 million range. There are multiple different things happening though, and we are seeing people trend toward narrow, smaller lots, making townhomes the new first home. Another area where I am seeing a trend is rooftop terraces, where rather than having backyards to deal with, outdoor living is on the roof. We are seeing more elevators in buildings to accommodate that and we are seeing more folks trying to get multigenerational housing to bring parents back into the homes or adult children staying longer at the home. Our city has also been embracing putting secondary housing on one lot for families. It all has to do with affordability.
What is your outlook and what are your top priorities for the next few years?
The biggest factor is engaging the smaller communities around the Triangle. My hope is to get city councils that understand that to produce affordable housing, they have to change guidelines and speed up processes. It is currently bogged down and takes way too long, so by the time housing hits, inflation has continued to ramp up the costs. They all want affordable housing but they are the problem, putting more legislation in place and making housing development harder.
Our HBA is very involved in this topic and our president is involved with municipalities around the Triangle. Unfortunately, a lot of people who run for city council are doing so because they have grievances they are trying to air, rather than being experts in what is good for a local economy. I hope the trend will be hiring experts to counsel them on what is good for cities. We are not going to stop growing as a population. As people continue to come here, they will need housing and that is something that will not change. It is important for our leaders to address that.
My plate has grown and I am representing 12 different counties where it used to be three. We’ve had to incorporate that urban sprawl as the city continues to develop. Even though we talk about ourselves in terms of a large city, when compared to Atlanta, we are very small but in that same vein, traffic is not as bad and we have the opportunity to create better road systems as we grow. Cities also need to take a look at all these large-lot subdivisions in the center of downtown that have 80-year-old restrictions, break them and stand behind zoning to allow for necessary development. There is no more Earth and we are not moving to another planet, so we have to do the best with the resources we have. Just because a home is smaller doesn’t mean it can’t have a personality. Everyone wants a place to call home.
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