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Highlands, NC: Rising Home Values and Declining Ownership in a Mountain Retreat
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
Highlands, a town in the mountains of North Carolina, has experienced significant changes in its housing market over the past decade. This community, known for its natural beauty and small-town charm, has seen notable shifts in homeownership rates, average home prices, and average rent prices. The general trend has been characterized by decreasing homeownership, rising average home prices, and relatively stable average rent prices.
From 2013 to 2022, Highlands witnessed a substantial decrease in homeownership rates. In 2013, 78% of residents owned their homes, but this figure dropped to 66% by 2022. Simultaneously, the percentage of renters increased from 22% to 34%. This shift coincided with a dramatic rise in average home prices. The average home price in Highlands more than doubled from $445,990 in 2013 to $970,166 in 2022, representing a 117.5% increase over nine years.
The relationship between federal interest rates and homeownership rates in Highlands is noteworthy. From 2013 to 2020, interest rates remained relatively low, ranging from 0.09% to 2.16%. During this period, homeownership rates declined steadily, from 78% to 68%. This trend suggests that factors other than interest rates, such as rapidly increasing home prices, may have had a more significant impact on homeownership in Highlands.
Renter percentages in Highlands increased from 22% in 2013 to 34% in 2022. Interestingly, average rent prices remained relatively stable during this period. In 2013, the average rent was $941, peaking at $989 in 2015, and then gradually decreasing to $816 in 2022. This stability in rent prices, despite the increasing percentage of renters, could be attributed to various factors, including local economic conditions and housing policies.
In 2023 and 2024, Highlands experienced a slight adjustment in its housing market. The average home price in 2023 was $944,937, representing a 2.6% decrease from 2022. However, in 2024, prices rebounded slightly to $966,725. Concurrently, federal interest rates rose significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates could potentially impact future homeownership rates and housing affordability in the town.
Looking ahead, predictive models suggest that average home prices in Highlands may continue to rise, albeit at a more moderate pace. Over the next five years, average home prices could potentially reach $1.1 million to $1.2 million, assuming current trends persist. Average rent prices, which have shown more stability, may see modest increases, potentially reaching $850 to $900 per month in the same timeframe.
In summary, Highlands has experienced a significant shift in its housing market over the past decade. The most notable trends include a decrease in homeownership rates, a substantial increase in average home prices, and relatively stable average rent prices. The recent rise in interest rates and the slight cooling of home prices in 2023 may signal a new phase in the town's housing market dynamics. As Highlands continues to evolve, these trends will likely play a crucial role in shaping the community's future housing landscape.
