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Cedar Rapids: Rising Home Values and Strong Ownership in Iowa's Cultural Hub
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
Cedar Rapids, Iowa's second-largest city, is known for its rich cultural heritage and thriving economy. This vibrant city has experienced notable shifts in homeownership rates, average home prices, and average rent prices over the past decade. The overall trend shows a slight increase in homeownership, rising average home prices, and fluctuating average rent prices.
The homeownership rate in Cedar Rapids has shown resilience, with a slight upward trend from 65% in 2019 to 70% in 2022. This increase coincides with a steady rise in average home prices, which grew from $147,676 in 2019 to $179,714 in 2022, representing a 21.7% increase over three years. The relationship between homeownership rates and average home prices suggests that despite rising costs, Cedar Rapids residents have maintained a strong interest in homeownership.
Federal interest rates have played a significant role in shaping homeownership trends in Cedar Rapids. The period from 2010 to 2021 saw historically low interest rates, ranging from 0.08% to 2.16%. This low-interest environment likely contributed to the city's relatively high homeownership rates during this time. For instance, in 2017, when the federal interest rate was 1%, the homeownership rate stood at 71%. The relationship between low interest rates and high homeownership rates aligns with the general trend of increased affordability of home financing during periods of low interest rates.
Renter percentages in Cedar Rapids have fluctuated inversely to homeownership rates, ranging from 29% to 35% between 2013 and 2022. Average rent prices have shown an overall upward trend, increasing from $671 in 2013 to $835 in 2022, representing a 24.4% rise over nine years. The population growth from 128,422 in 2013 to 136,438 in 2022 may have contributed to the increased demand for rental properties, potentially driving up average rent prices.
In 2023, the average home price in Cedar Rapids reached $187,901, showing a continued upward trajectory from previous years. The federal interest rate for 2023 was 5.02%, significantly higher than the rates seen in the previous decade. Moving into 2024, the average home price has further increased to $193,104, while the federal interest rate has risen slightly to 5.33%. These figures indicate a continuation of the upward trend in home prices despite higher interest rates.
Looking ahead, based on historical trends and current market conditions, it's projected that average home prices in Cedar Rapids will continue to rise over the next five years, potentially reaching around $225,000 by 2029. Average rent prices are also expected to increase, possibly surpassing $950 per month within the same timeframe. These projections assume a continuation of current economic conditions and housing market dynamics.
In summary, Cedar Rapids has demonstrated a robust housing market characterized by increasing homeownership rates and rising average home prices. The city has maintained a strong preference for homeownership even in the face of rising costs. The rental market has also shown growth, with increasing average rent prices reflecting the city's population growth and demand for housing. As Cedar Rapids continues to evolve, these housing trends will likely play a crucial role in shaping the city's future development and community dynamics.
