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Average Home Values and Ownership in Zip Code 07107: Newark's 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
Zip code 07107 is located in Newark, New Jersey, covering an area of 1.67 square miles. This densely populated urban area has experienced significant changes in homeownership rates and housing prices over the past decade. The zip code has seen a general trend of increasing average home prices and a recent shift towards higher homeownership rates.
The homeownership rate in zip code 07107 has shown a notable increase in recent years. In 2013, the percentage of owner-occupied housing units was 23%. This figure remained relatively stable until 2020 when it began to rise. By 2022, the homeownership rate had reached 32%, representing a significant increase of 9 percentage points over a two-year period. Concurrently, average home prices in the area have shown a consistent upward trend. In 2013, the average home price was $162,820. By 2022, this figure had risen dramatically to $422,284, representing an increase of approximately 159% over nine years.
The relationship between federal interest rates and homeownership rates in zip code 07107 appears to follow general economic trends. As interest rates remained low between 2013 and 2021, ranging from 0.08% to 0.4%, homeownership rates remained relatively stable. However, the significant increase in homeownership from 25% in 2020 to 32% in 2022 occurred despite a rise in interest rates from 0.38% in 2020 to 1.68% in 2022. This suggests that other factors, such as local economic conditions or housing policies, may have played a role in encouraging homeownership during this period.
Renter percentages in zip code 07107 have correspondingly decreased as homeownership rates have risen. In 2013, 77% of housing units were renter-occupied. This percentage remained relatively stable until 2020, when it began to decline. By 2022, the renter percentage had decreased to 68%. Average rent prices have shown some fluctuation over this period. In 2013, the average rent was $1,088. It declined slightly to $1,030 in 2016 before rising again to $1,116 in 2022. Despite the decrease in renter percentage, the modest increase in average rent prices may reflect the overall housing demand in the area, influenced by the growing population, which increased from 37,636 in 2013 to 40,736 in 2022.
In 2023 and 2024, the average home prices in zip code 07107 continued to rise. The average home price reached $448,053 in 2023 and further increased to $461,713 in 2024. This represents a growth of 6.1% from 2022 to 2023 and an additional 3.0% from 2023 to 2024. Notably, federal interest rates also increased significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024. Despite these higher interest rates, home prices in the area continued to appreciate, suggesting strong demand for housing in this zip code.
Looking ahead, based on the observed trends, we can forecast potential 5-year trends for average home and rent prices in zip code 07107. Assuming the current trajectory continues, average home prices could potentially reach around $550,000 to $600,000 by 2029. This projection considers the consistent year-over-year increases observed in the past decade. For average rent prices, a more modest increase might be expected, potentially reaching $1,200 to $1,300 per month by 2029, considering the slower rate of increase in rent prices compared to home values.
In summary, zip code 07107 in Newark has experienced a significant shift towards homeownership in recent years, accompanied by substantial increases in average home prices. Despite rising interest rates, the housing market in this area has shown resilience and continued growth. The trend of increasing homeownership and rising property values, if sustained, could reshape the demographic and economic landscape of this urban neighborhood in the coming years.
