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Altoona, Iowa: Rising Home Values and Ownership Trends in a Growing Suburb
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
Altoona, Iowa, a rapidly growing suburb of Des Moines, is known for its popular amusement park, Adventureland Resort. The city has experienced significant population growth and development over the past decade, which has had a notable impact on its housing market. Homeownership rates in Altoona have remained relatively stable, with a slight decline from 76% in 2013 to 71% in 2022. During this period, average home prices have shown a consistent upward trend, while average rent prices have also increased, particularly in recent years.
The relationship between homeownership rates and average home prices in Altoona reveals an interesting dynamic. Despite the steady increase in average home prices from $173,780 in 2010 to $295,666 in 2022, homeownership rates have only slightly decreased. This suggests that while rising home prices might have made purchasing a home more challenging for some residents, the overall demand for homeownership in Altoona has remained strong. The most significant drop in homeownership occurred between 2013 and 2015, falling from 76% to 73%, coinciding with a period of rapid home price appreciation.
Federal interest rates have played a role in shaping homeownership trends in Altoona. The period from 2010 to 2016 saw historically low interest rates, ranging from 0.09% to 0.40%, which likely contributed to maintaining relatively high homeownership rates despite rising home prices. As interest rates began to climb from 2017 onwards, reaching 1.68% in 2022, we observe a slight decrease in homeownership rates, dropping from 75% in 2017 to 71% in 2022.
The rental market in Altoona has shown an upward trend in both renter percentages and average rent prices. The percentage of renters increased from 22% in 2013 to 29% in 2022, while average rent prices rose from $476 in 2013 to $994 in 2022. This substantial increase in rent prices, more than doubling over nine years, reflects the growing demand for rental properties in the area. The population growth from 18,054 in 2013 to 22,892 in 2022 likely contributed to this increased demand for rental housing.
In 2023 and 2024, Altoona's housing market continued its upward trajectory. The average home price reached $304,173 in 2023 and further increased to $312,062 in 2024. Simultaneously, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, marking a substantial increase from previous years. These higher interest rates may impact affordability and potentially influence future homeownership trends in the city.
Looking ahead, based on the historical data and current trends, we can forecast continued growth in both average home prices and rent prices over the next five years. Average home prices are projected to maintain a steady increase, potentially reaching around $350,000 by 2029. Average rent prices are also expected to rise, possibly surpassing $1,200 per month within the same timeframe. However, the pace of these increases may moderate compared to the rapid growth seen in recent years, especially if interest rates remain elevated.
In summary, Altoona's housing market has demonstrated resilience and growth, characterized by steadily increasing home values and rising rent prices. While homeownership rates have slightly declined, they remain relatively high, indicating a strong desire for homeownership in the community. The city's population growth has been a key driver of housing demand, influencing both the ownership and rental markets. As Altoona continues to develop, balancing housing affordability with the city's growth will be crucial for maintaining a diverse and thriving community.
