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72718 Zip Code: Soaring Home Values and Ownership in Cave Springs' Rapidly Growing Suburban Area
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
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Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Cave Springs, located in zip code 72718 in Arkansas, has experienced significant growth and changes in its housing market over the past decade. This analysis explores the trends in homeownership rates, average home prices, and average rent prices in this rapidly developing area. The homeownership rate in Cave Springs has shown a strong upward trend, increasing from 72% in 2013 to 89% in 2022. This rise in homeownership coincides with a substantial increase in average home prices. In 2013, the average home price was $228,430, and by 2022, it had risen to $460,238, representing a 101.5% increase over nine years. This trend suggests a growing demand for homeownership in the area, despite rising prices.
Federal interest rates have played a significant role in shaping homeownership trends. From 2013 to 2016, interest rates remained low, ranging from 0.11% to 0.4%, which likely contributed to the increase in homeownership from 72% to 84% during this period. As interest rates began to rise from 2017 to 2019, reaching 2.16%, homeownership continued to grow, albeit at a slower pace, reaching 89% by 2019. The subsequent drop in interest rates to 0.08% in 2021 coincided with a peak in homeownership at 91%.
The rental market in Cave Springs has experienced fluctuations in both the percentage of renters and average rent prices. In 2013, 28% of residents were renters, with an average rent of $1,451. By 2022, the renter percentage had decreased to 11%, while the average rent had increased to $1,723. This trend suggests that as the population grew from 2,344 in 2013 to 5,429 in 2022, more residents transitioned to homeownership, potentially due to the area's economic growth and desirability.
In 2023 and 2024, the housing market in Cave Springs continued to evolve. The average home price reached $485,339 in 2023 and further increased to $497,822 in 2024, representing a 5.5% and 2.6% year-over-year growth, respectively. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, which may impact future homeownership trends and housing affordability in the area.
Looking ahead, predictive models suggest that average home prices in Cave Springs are likely to continue rising over the next five years, albeit at a potentially slower pace due to higher interest rates. Average rent prices are also expected to increase, driven by the area's population growth and limited rental inventory. However, the rate of increase may be moderated by the strong preference for homeownership in the community.
In summary, Cave Springs has experienced a remarkable increase in homeownership rates and average home prices over the past decade. The interplay between federal interest rates, population growth, and local economic factors has shaped a housing market that strongly favors ownership. As the city continues to grow, balancing housing affordability with the demand for homeownership will be crucial for maintaining the area's attractiveness to both current and future residents.
