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Average Home Values and Ownership in Zip Code 55720: Cloquet'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 55720, located in Cloquet, Minnesota, has experienced notable shifts in homeownership rates and housing prices over the past decade. This area, known for its picturesque landscapes and strong community ties, has seen a gradual increase in homeownership alongside fluctuating average home and rent prices.
The homeownership rate in zip code 55720 has shown a general upward trend from 2013 to 2022. In 2013, the homeownership rate was 72%, which steadily increased to a peak of 76% in 2017. However, there was a slight decline in recent years, settling at 72% in 2022. This trend coincides with changes in average home prices, which have seen significant growth. The average home price in 2013 was $134,593, and it rose consistently year over year, reaching $227,645 in 2022, representing a substantial 69% increase over this period.
Federal interest rates have played a crucial role in shaping homeownership trends in zip code 55720. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.11% to 0.40%, which likely contributed to the increase in homeownership rates during this time. As interest rates began to rise more significantly from 2017 onwards, reaching 1.83% in 2018 and 2.16% in 2019, we observed a slight decline in homeownership rates, suggesting a correlation between higher interest rates and reduced home buying activity.
Renter percentages in zip code 55720 have inversely mirrored the homeownership trends, decreasing from 28% in 2013 to a low of 24% in 2017, before rising back to 28% in 2022. Average rent prices have shown an overall upward trend, increasing from $841 in 2013 to $902 in 2022, with some fluctuations in between. The highest average rent was recorded in 2021 at $919. These trends suggest that while homeownership became more prevalent, rental prices also increased, potentially due to increased demand for the limited rental stock or improvements in rental property quality.
In 2023 and 2024, we see a continuation of the upward trend in average home prices in zip code 55720. The average home price reached $242,485 in 2023 and further increased to $247,168 in 2024. This represents a 6.5% increase from 2022 to 2023 and a 1.9% increase from 2023 to 2024. Notably, federal interest rates also rose significantly during this period, hitting 5.02% in 2023 and 5.33% in 2024, which are the highest rates seen in over a decade.
Looking ahead, based on the observed trends and current economic conditions, we can project that average home prices in zip code 55720 may continue to rise over the next five years, albeit at a potentially slower rate due to higher interest rates. We might expect average home prices to reach around $270,000 to $280,000 by 2029. Average rent prices are also likely to increase, potentially reaching $950 to $1,000 per month in the same timeframe, assuming consistent growth patterns and barring any major economic shifts.
In summary, zip code 55720 has demonstrated a robust housing market with increasing homeownership rates and rising property values over the past decade. The interplay between federal interest rates, homeownership percentages, and housing prices underscores the dynamic nature of the local real estate market. While recent years have seen some stabilization in homeownership rates, the continued rise in average home and rent prices suggests ongoing demand for housing in this area.
