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Housing Stability Amid Price Increases: Charleston's Resilient Real Estate Market
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Charleston, Illinois, a city known for hosting Eastern Illinois University, has experienced significant changes in its housing market over the past decade. Despite a declining population, the city has maintained a relatively stable homeownership rate while seeing increases in both average home prices and rent. This analysis examines the trends in homeownership, property values, and rental prices from 2013 to 2024, and provides projections for the next five years.
From 2013 to 2022, Charleston's homeownership rate remained relatively constant, fluctuating between 52% and 54%. During this period, average home prices showed a general upward trend, increasing from $103,519 in 2013 to $126,357 in 2022, representing a 22% rise over nine years. This trend suggests that despite rising home prices, Charleston maintained a consistent level of homeownership.
Federal interest rates have played a significant role in shaping homeownership trends in Charleston. From 2013 to 2016, when interest rates were historically low (ranging from 0.11% to 0.40%), homeownership rates remained stable at around 52-54%. As interest rates began to rise more significantly from 2017 (1.00%) to 2019 (2.16%), homeownership rates showed resilience, maintaining at 54%. This suggests that other local factors, such as the university's presence, may have helped sustain homeownership rates despite rising interest rates.
Renter percentages in Charleston have shown minor fluctuations, ranging from 46% to 48% between 2013 and 2022. Average rent prices have generally increased during this period, albeit with some variability. In 2013, the average rent was $709, which rose to $765 by 2022, an increase of about 7.9%. Notably, there was a significant jump in average rent from $768 in 2020 to $815 in 2021, possibly influenced by the changing dynamics of the housing market during the COVID-19 pandemic. The city's population has been declining since 2013, from 26,416 to 21,254 in 2022, which may have influenced the rental market dynamics.
Looking at the most recent data, the average home price in Charleston continued its upward trajectory, reaching $131,701 in 2023 and further increasing to $139,414 in 2024. This represents a substantial 10.3% increase from 2022 to 2024. Concurrently, federal interest rates have risen significantly, reaching 5.02% in 2023 and 5.33% in 2024, which could potentially impact future homeownership rates and market dynamics.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in Charleston will continue to rise, potentially reaching around $160,000 by 2029. This projection is based on the consistent upward trend observed over the past decade. For average rent prices, the forecast suggests a more moderate increase, potentially reaching approximately $850 by 2029, assuming the trend of gradual increases continues.
In summary, Charleston's housing market has demonstrated resilience and growth over the past decade. Despite a declining population, homeownership rates have remained relatively stable, while both average home prices and rents have increased. The city has maintained a balance between owner-occupied and renter-occupied housing, even in the face of rising property values and fluctuating interest rates. As Charleston moves forward, it will be crucial to monitor how these trends evolve, particularly in light of the recent significant increases in both home prices and interest rates.
