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Eagan, Minnesota: Rising Home Values and Steady Ownership in a Business-Friendly City
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
Eagan, a vibrant city in Minnesota, has experienced notable shifts in its housing market over the past decade. Located in Dakota County, Eagan is known for its strong business community and high quality of life. The city has seen fluctuations in homeownership rates, with a general trend towards increased ownership, while average home prices and average rent prices have shown steady growth.
From 2013 to 2022, Eagan's homeownership rate increased from 66% to 65%, with some fluctuations in between. During this same period, average home prices rose significantly, from $225,254 in 2013 to $396,785 in 2022, representing a 76% increase. This trend suggests a strong correlation between rising home values and homeownership rates, as residents may have been motivated to purchase homes due to the potential for appreciation.
Federal interest rates have played a crucial role in shaping homeownership trends in Eagan. From 2013 to 2016, when interest rates were historically low (ranging from 0.11% to 0.40%), homeownership rates remained relatively stable around 67%. As interest rates began to rise from 2017 (1.00%) to 2019 (2.16%), there was a slight increase in homeownership, reaching 71% in 2018. This trend aligns with the general principle that lower interest rates encourage homeownership due to more affordable financing options.
Regarding rental trends, the percentage of renters in Eagan decreased from 34% in 2013 to 35% in 2022. However, average rent prices increased substantially during this period, rising from $1,085 in 2013 to $1,515 in 2022, a 40% increase. This trend suggests that despite rising rental costs, a significant portion of the population continued to rent, possibly due to factors such as job mobility or preference for rental lifestyle.
In 2023 and 2024, Eagan's housing market showed signs of stabilization. The average home price in 2023 was $394,197, a slight decrease from 2022, but rebounded to $396,907 in 2024. Interestingly, federal interest rates rose significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024, which may have impacted home buying decisions.
Looking ahead, based on historical trends and current market conditions, it's projected that average home prices in Eagan will continue to rise moderately over the next five years, potentially reaching around $450,000 by 2029. Average rent prices are also expected to increase, possibly surpassing $1,800 per month within the same timeframe.
In summary, Eagan's housing market has demonstrated resilience and growth over the past decade. The city has maintained a strong homeownership rate despite rising home prices, while also seeing significant increases in average rent. The interplay between federal interest rates, home prices, and rental costs has shaped the housing landscape, with recent stabilization in home prices potentially indicating a more balanced market moving forward.
