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Farmington, Missouri: Home Values Double as Ownership Rates Decline
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Farmington, Missouri, a vibrant city in St. Francois County, has experienced significant changes in its housing market over the past decade. With a population of 21,531 in 2022, this community has seen a gradual decrease in homeownership rates alongside rising average home prices and fluctuating average rent prices.
The homeownership rate in Farmington has steadily declined from 65% in 2013 to 58% in 2022. This trend correlates with a substantial increase in average home prices, which rose from $103,462 in 2013 to $224,984 in 2022, representing a 117% increase over nine years. The inverse relationship between homeownership rates and average home prices suggests that rising property values may be making homeownership less accessible for some residents.
Federal interest rates have played a crucial role in shaping homeownership trends in Farmington. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.11% to 0.4%, which coincided with relatively stable homeownership rates between 61% and 65%. However, as interest rates began to rise more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates started to decline more noticeably, dropping from 64% in 2017 to 62% in 2019. This trend illustrates how higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
As homeownership rates declined, the percentage of renters in Farmington increased from 35% in 2013 to 42% in 2022. Average rent prices have shown some volatility during this period. Starting at $656 in 2013, average rent peaked at $707 in 2015 before declining to $644 in 2018. However, there was a significant uptick in recent years, with average rent reaching $797 in 2021 before slightly decreasing to $749 in 2022. This overall upward trend in rent prices, combined with the growing renter population, suggests increasing demand for rental properties in Farmington.
In 2023 and 2024, Farmington's housing market continued to evolve. The average home price rose to $231,760 in 2023 and further increased to $240,715 in 2024, indicating a continued upward trend in property values. Concurrently, federal interest rates climbed significantly to 5.02% in 2023 and 5.33% in 2024, reaching levels not seen since before the 2008 financial crisis. These higher interest rates are likely to impact mortgage affordability and could influence future homeownership rates in the city.
Looking ahead, predictive models suggest that Farmington's housing market will continue to experience growth in both average home prices and rent prices over the next five years. Average home prices are projected to increase by approximately 3-5% annually, potentially reaching around $280,000 by 2029. Average rent prices are expected to follow a similar trajectory, with annual increases of 2-4%, potentially surpassing $850 per month by 2029. These projections assume relatively stable economic conditions and continued population growth in Farmington.
In summary, Farmington has witnessed a clear shift towards a more rental-oriented housing market over the past decade, driven by rising home prices and fluctuating interest rates. The city's growing population and increasing property values suggest a robust demand for housing, both for purchase and rent. As Farmington continues to evolve, these housing market trends will play a crucial role in shaping the city's demographic and economic landscape in the coming years.
