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Hanceville, Alabama: Home Values Double Amid Fluctuating Ownership Rates
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
Hanceville, a city in Alabama, has experienced notable shifts in its housing market over the past decade. This small urban center, covering 4.4 square miles, has seen fluctuations in homeownership rates and significant changes in average home and rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Hanceville has shown a declining trend since 2013. In 2013, 59% of housing units were owner-occupied. This rate peaked at 64% in 2016 and 2018 but has since decreased to 55% in 2022. Concurrently, average home prices have risen substantially. In 2013, the average home price was $100,717, which steadily increased to $199,029 by 2022, representing a 97.6% increase over this period.
The relationship between federal interest rates and homeownership rates in Hanceville aligns with general economic principles. As interest rates remained low between 2013 and 2016 (ranging from 0.11% to 0.40%), homeownership rates increased from 59% to 64%. However, as interest rates began to rise more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates started to decline, reaching 63% by 2019. This trend continued into 2022, with homeownership dropping to 55% as interest rates climbed to 1.68%.
Renter occupancy in Hanceville has shown an inverse relationship to homeownership trends. The percentage of renter-occupied units increased from 41% in 2013 to 45% in 2022. Average rent prices have also risen, albeit less dramatically than home prices. In 2013, the average rent was $590, which increased to $660 by 2022, representing a 11.9% increase. This more modest increase in rent prices, compared to the sharp rise in home prices, may have contributed to the growing proportion of renters in the city.
In 2023 and 2024, Hanceville's housing market continued to evolve. The average home price reached $200,693 in 2023, the highest point in the city's recent history. However, 2024 saw a slight decrease to $199,065, possibly influenced by the significant rise in federal interest rates to 5.33% in 2024. This high interest rate environment may continue to impact homeownership rates and market dynamics in the near future.
Looking ahead, predictive models suggest that average home prices in Hanceville may continue to rise moderately over the next five years, albeit at a slower pace than the rapid growth seen in the early 2020s. Rent prices are also expected to increase, potentially at a rate outpacing wage growth, which could further shift the balance towards renting for many residents.
In summary, Hanceville has experienced a significant increase in average home prices, a decline in homeownership rates, and a moderate rise in average rent prices over the past decade. These trends, influenced by factors such as interest rates and local economic conditions, have reshaped the city's housing landscape. The recent stabilization of home prices and high interest rates may signal a new phase in Hanceville's housing market, potentially impacting future homeownership trends and rental demand.
