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Average Home Values and Ownership in Zip Code 59068: Red Lodge's Mountain Town Housing Dynamics
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 59068, which encompasses Red Lodge in Montana, presents an intriguing case study of housing market dynamics in a small mountain town. This area has experienced notable fluctuations in homeownership rates and property values over the past decade, reflecting broader economic trends and local market conditions.
The homeownership rate in Red Lodge has shown a general decline from 2013 to 2022, with some fluctuations. In 2013, the homeownership rate stood at 72%, reaching a peak of 75% in 2017 before declining to 65% by 2022. This downward trend in homeownership coincided with a significant increase in average home prices. From 2016 to 2022, average home prices in the area rose dramatically from $243,867 to $448,915, representing an increase of approximately 84% over six years.
The relationship between federal interest rates and homeownership rates in Red Lodge shows some correlation. As interest rates remained low from 2013 to 2016, hovering around 0.1% to 0.4%, homeownership rates were relatively stable. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, there was a noticeable decline in homeownership rates. This trend aligns with the general principle that higher interest rates can make mortgages less affordable, potentially discouraging home purchases.
Renter percentages in Red Lodge have shown an overall increase from 28% in 2013 to 35% in 2022, inversely mirroring the decline in homeownership. Interestingly, average rent prices have not consistently followed this upward trend. Average rent peaked at $937 in 2014, then fluctuated over the years, dropping to $723 in 2022. This decrease in average rent despite an increase in the renter population could be attributed to various factors, including changes in the local economy or an increase in rental unit supply.
In 2023 and 2024, the housing market in Red Lodge continued to evolve. Average home prices reached $469,440 in 2023 and further increased to $497,689 in 2024, representing a 4.5% and 6% year-over-year increase, respectively. These price increases occurred despite a significant rise in federal interest rates, which stood at 5.02% in 2023 and 5.33% in 2024, potentially indicating strong demand in the local housing market.
Looking ahead, predictive models suggest that average home prices in Red Lodge may continue to rise over the next five years, albeit at a potentially slower rate than observed in recent years. This projection is based on the historical trend of increasing property values in the area. Average rent prices, which have shown more volatility, are harder to predict with certainty. However, if the trend of increasing renter percentages continues, it could lead to upward pressure on rent prices in the coming years.
In summary, Red Lodge's housing market has been characterized by declining homeownership rates, rapidly increasing average home prices, and fluctuating rent prices over the past decade. The interplay between these factors, along with changes in federal interest rates and local population dynamics, has shaped a complex and evolving housing landscape in this Montana community. As the market continues to adjust to economic conditions and demographic shifts, it will be crucial to monitor these trends and their impact on housing affordability and accessibility in Red Lodge.
