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Alexandria, Kentucky: Rising Home Values and High Ownership Rates in a Resilient Housing Market
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
Alexandria, Kentucky, a vibrant city nestled in Campbell County, has experienced significant changes in its housing market over the past decade. With a population of 11,975 in 2022 and covering an area of 6.96 square miles, Alexandria has maintained a strong preference for homeownership throughout the years. The city has seen notable fluctuations in average home prices and average rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Alexandria has remained consistently high, showcasing a strong community preference for owning rather than renting. In 2013, the homeownership rate stood at 87%, and by 2022, it had increased slightly to 89%. This upward trend in homeownership coincides with a substantial increase in average home prices. The average home price in Alexandria rose from $162,710 in 2013 to $280,956 in 2022, representing a remarkable 72.7% increase over nine years.
The relationship between federal interest rates and homeownership rates in Alexandria appears to follow the general trend of lower interest rates encouraging homeownership. For instance, when interest rates were at historic lows between 2020 and 2021 (0.38% and 0.08% respectively), Alexandria's homeownership rate reached its peak at 89% in 2022. This suggests that the low-interest environment may have contributed to making home purchases more accessible for residents.
Conversely, the percentage of renters in Alexandria has shown a slight decline over the years, from 13% in 2013 to 11% in 2022. Despite this decrease in the renter population, average rent prices have experienced significant fluctuations. The average rent increased from $696 in 2013 to a peak of $978 in 2021, before slightly decreasing to $941 in 2022. This represents a 35.2% increase in average rent over the nine-year period, which is substantial but not as dramatic as the rise in home prices.
Looking at more recent data, the average home price in Alexandria continued to rise, reaching $287,456 in 2023 and $288,675 in 2024. This represents a modest increase of 2.7% from 2022 to 2024. Interestingly, this slower rate of appreciation coincides with a significant increase in federal interest rates, which rose to 5.02% in 2023 and 5.33% in 2024. These higher interest rates may be contributing to a cooling effect on home price growth.
Applying predictive models to forecast 5-year trends, we can anticipate continued growth in both average home prices and average rent prices in Alexandria, albeit at a more moderate pace. Average home prices are projected to reach approximately $320,000 by 2029, representing an estimated 10.9% increase from 2024. Average rent prices are expected to follow a similar trajectory, potentially reaching around $1,100 per month by 2029, an increase of about 16.9% from 2022 levels.
In summary, Alexandria, Kentucky, has demonstrated a robust housing market characterized by high homeownership rates and significant appreciation in both home values and rent prices over the past decade. The city's strong preference for homeownership, coupled with rising property values, suggests a stable and desirable residential market. However, the recent slowdown in price appreciation, coinciding with rising interest rates, indicates a potential shift towards a more balanced market in the coming years. As Alexandria continues to grow and evolve, its housing market is likely to remain an attractive option for both homeowners and investors alike.
