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Cherry Creek's Rising Home Values and Shifting Ownership Trends: A Decade of Change in Denver's Affluent Neighborhood
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
Cherry Creek, an affluent neighborhood in Denver, Colorado, has experienced significant changes in homeownership rates and property values over the past decade. The area, known for its upscale shopping district and luxurious residential areas, reflects broader economic trends and local market dynamics in its real estate landscape.
Homeownership rates in Cherry Creek have fluctuated notably since 2013. The rate increased from 45% in 2013 to a peak of 54% in 2017, coinciding with a substantial rise in average home prices. During this period, average home values climbed from $593,759 to $811,409, representing a 36.7% increase. However, the ownership rate has since declined, reaching 44% in 2022, while average home prices continued to rise, reaching $1,150,702 in the same year. This inverse relationship suggests that escalating property values may have made homeownership less attainable for some residents.
Federal interest rates have played a crucial role in shaping homeownership trends in Cherry Creek. The period of low interest rates from 2013 to 2016, when rates remained below 0.5%, corresponded with the increase in homeownership rates. As interest rates began to rise from 2017 onwards, reaching 1.83% in 2018 and 2.16% in 2019, the homeownership rate in Cherry Creek started to decline. This trend aligns with the general principle that lower interest rates tend to encourage homeownership by making mortgages more affordable.
Renter percentages in Cherry Creek have shown an inverse relationship to homeownership rates. The renter population decreased from 54% in 2013 to 45% in 2017, before climbing back to 56% in 2022. Average rent prices have generally increased over this period, rising from $1,846 in 2013 to $2,083 in 2022, with some fluctuations in between. The increase in renter percentages despite rising rent prices could be attributed to the growing population in Cherry Creek, which expanded from 5,420 in 2013 to 6,097 in 2022, potentially driving up demand for rental properties.
In 2023 and 2024, Cherry Creek's average home prices have stabilized, with values of $1,140,333 and $1,140,670 respectively. This plateau in home prices comes as federal interest rates have risen significantly to 5.02% in 2023 and 5.33% in 2024, potentially cooling the housing market.
Looking ahead, predictive models suggest that average home prices in Cherry Creek may experience modest growth over the next five years, potentially reaching around $1.3 million by 2029. Average rent prices are also expected to continue their upward trajectory, potentially surpassing $2,500 per month within the same timeframe. These projections are based on historical trends and current market conditions.
In summary, Cherry Creek has witnessed a complex interplay between homeownership rates, property values, and rental market dynamics. The neighborhood has seen substantial increases in both home prices and rent over the past decade, with recent trends indicating a shift towards a higher percentage of renters. The stabilization of home prices in 2023 and 2024, coupled with higher interest rates, may signal a new phase in the neighborhood's real estate market, potentially affecting future homeownership rates and property values.
