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Average Home Values and Ownership in Zip Code 07112: Newark's Shifting Housing Landscape
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 07112, located in Newark, New Jersey, has experienced significant changes in its housing market over the past decade. This area has consistently maintained a high percentage of renters, with homeownership rates hovering around 30%. Average home prices in this zip code have shown a remarkable upward trend, particularly in recent years, while average rent prices have also steadily increased, reflecting the dynamic nature of Newark's real estate market.
The homeownership rate in zip code 07112 has remained relatively stable, with a slight downward trend observed from 2013 to 2022. In 2013, the homeownership rate was 30%, which decreased to 28% by 2022. During this same period, average home prices experienced significant growth. In 2013, the average home price was $140,036, which increased to $389,496 by 2022, representing a substantial 178% increase over nine years. This inverse relationship between homeownership rates and average home prices suggests that rising property values may have made homeownership less attainable for some residents in this area.
Federal interest rates have played a role in shaping homeownership trends in zip code 07112. From 2013 to 2016, when interest rates were at historic lows (ranging from 0.11% to 0.40%), the homeownership rate remained stable at 29-30%. However, as interest rates began to rise from 2017 (1.00%) to 2019 (2.16%), we observed a slight decrease in homeownership to 27% in 2019. Interestingly, despite the drop in interest rates in 2020 and 2021 (0.38% and 0.08% respectively), homeownership only marginally increased to 28%, suggesting that other factors, such as rapidly increasing home prices, may have counteracted the potential positive effect of lower interest rates on homeownership.
The renter population in zip code 07112 has consistently been the majority, increasing from 70% in 2013 to 72% in 2022. This trend coincides with a steady increase in average rent prices. In 2013, the average rent was $1,084, which rose to $1,148 by 2022, an increase of about 5.9% over nine years. The population in this zip code fluctuated during this period, reaching a low of 24,068 in 2020 before increasing to 26,831 in 2022. The persistent high percentage of renters, coupled with rising rent prices, suggests a strong demand for rental properties in this area, possibly driven by the increasing difficulty of homeownership due to rising property values.
In 2023 and 2024, the housing market in zip code 07112 continued its upward trajectory. The average home price reached $423,894 in 2023 and further increased to $446,148 in 2024, representing a 5.2% year-over-year increase. This growth occurred despite the significant rise in federal interest rates, which stood at 5.02% in 2023 and 5.33% in 2024. These high interest rates, combined with the continued increase in home prices, may present challenges for potential homebuyers in the near future.
Looking ahead, based on the observed trends, we can predict that average home prices in zip code 07112 are likely to continue rising over the next five years, albeit potentially at a slower rate due to high interest rates. Average rent prices are also expected to increase, driven by the persistent demand for rental properties. If current trends continue, we might see average home prices reaching around $550,000 by 2029, while average rent prices could approach $1,400 per month.
In summary, zip code 07112 has experienced a significant increase in average home prices over the past decade, with a concurrent slight decrease in homeownership rates. The area maintains a high proportion of renters, with gradually increasing average rent prices. The interplay between rising property values, fluctuating interest rates, and the persistent demand for rental properties has shaped a dynamic housing market in this Newark zip code. As we look to the future, continued growth in both home prices and rent prices seems likely, potentially further impacting the balance between homeowners and renters in this area.
