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Average Home Values and Ownership in Zip Code 94598: A Decade of Change in Walnut Creek
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 94598, located in Walnut Creek, California, has experienced significant changes in its housing market over the past decade. This analysis explores the trends in homeownership rates, average home prices, and average rent prices, providing insights into the evolving real estate landscape of this suburban community. The homeownership rate in zip code 94598 has shown a slight decline over the years, dropping from 82% in 2013 to 76% in 2022. This trend corresponds with a substantial increase in average home prices, which rose from $695,276 in 2013 to $1,496,650 in 2022, representing a remarkable 115% increase over nine years. The inverse relationship between homeownership rates and average home prices suggests that rising property values may be making it more challenging for residents to purchase homes in the area.
Federal interest rates have played a significant role in shaping homeownership trends in zip code 94598. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.11% to 0.40%, which coincided with a relatively stable homeownership rate around 77-79%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, the homeownership rate experienced a gradual decline to 76%. This trend aligns with the general principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
The renter population in zip code 94598 has seen a corresponding increase, rising from 18% in 2013 to 24% in 2022. This shift has been accompanied by a significant uptick in average rent prices, which escalated from $1,845 in 2013 to $2,780 in 2022, marking a 51% increase. The population in the zip code has remained relatively stable during this period, fluctuating between 28,000 and 30,000 residents. The combination of rising rents and a growing renter population suggests a strong demand for rental properties in the area, possibly driven by those priced out of the homeownership market.
In 2023 and 2024, the housing market in zip code 94598 showed signs of stabilization. The average home price in 2023 was $1,444,528, representing a slight decrease from the 2022 peak. However, in 2024, prices rebounded to $1,483,508. Notably, federal interest rates climbed to 5.02% in 2023 and further to 5.33% in 2024, reaching levels not seen since the early 2000s. These higher interest rates may contribute to a cooling effect on home price appreciation and potentially impact homeownership rates in the coming years.
Looking ahead, predictive models forecast continued growth in both average home prices and rent prices over the next five years, albeit at a more moderate pace. Average home prices are projected to increase by approximately 3-4% annually, potentially reaching around $1.75 million by 2029. Average rent prices are expected to rise by 2-3% per year, potentially surpassing $3,200 by 2029. These projections take into account historical trends, current market conditions, and potential economic factors.
In summary, zip code 94598 has experienced a notable shift in its housing market dynamics over the past decade. The area has seen a gradual decrease in homeownership rates coupled with substantial increases in both average home prices and rent prices. The interplay between federal interest rates, property values, and affordability has shaped these trends. As the market continues to evolve, it will be crucial to monitor how these factors influence housing accessibility and community demographics in this desirable Walnut Creek neighborhood.
