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Lincoln, Alabama: Rising Home Values and Strong Ownership in NASCAR's Backyard
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
Lincoln, Alabama, is a small but growing community located in the heart of the state. Known for its picturesque setting and friendly atmosphere, this city has experienced interesting shifts in homeownership and housing prices over the past decade. The overall trend shows an increase in homeownership rates, coupled with rising average home prices and fluctuating average rent prices.
Homeownership rates in Lincoln have shown a notable upward trend, particularly in recent years. In 2013, the homeownership rate was 84%, which decreased slightly to 79% by 2018. However, from 2018 onwards, there was a significant increase, reaching 88% in 2022. This rise in homeownership coincides with a steady increase in average home prices. In 2013, the average home price was $126,790, which grew to $153,318 by 2018, and further increased to $226,791 by 2022, representing a substantial 79% increase over this nine-year period.
The relationship between federal interest rates and homeownership rates in Lincoln follows a general trend observed in many markets. As interest rates decreased from 2.16% in 2019 to 0.38% in 2020 and further to 0.08% in 2021, homeownership rates increased from 80% to 83% and then to 86%. This aligns with the principle that lower interest rates tend to encourage homeownership due to more affordable financing options. However, it's worth noting that despite the interest rate increase to 1.68% in 2022, homeownership continued to rise to 88%, suggesting other factors may also be influencing this trend.
Renter percentages in Lincoln have shown an inverse relationship to homeownership rates, naturally decreasing as homeownership increased. The renter population peaked at 21% in 2018, coinciding with a period of relatively higher average rent prices. Average rent prices fluctuated over the years, with notable increases from $892 in 2013 to $1,068 in 2016. However, there was a decrease in average rent prices in recent years, dropping from $975 in 2019 to $814 in 2022. This decrease in rent prices, coupled with the city's population growth from 11,366 in 2019 to 11,334 in 2022, may have contributed to the shift towards increased homeownership.
In 2023 and 2024, the average home prices in Lincoln continued to rise, reaching $232,640 in 2023 and $235,076 in 2024. This represents a modest increase of about 1% from 2023 to 2024. Interestingly, this slower rate of increase coincides with higher federal interest rates, which rose to 5.02% in 2023 and 5.33% in 2024. These higher interest rates may be contributing to a cooling effect on home price growth.
Looking ahead, based on the historical data and current trends, we can project that average home prices in Lincoln may continue to rise over the next five years, but potentially at a slower rate than seen in recent years. The average home price could potentially reach around $250,000 to $260,000 by 2029. Average rent prices, which have been decreasing in recent years, may stabilize or potentially see modest increases, possibly reaching around $850 to $900 per month by 2029. However, these projections are subject to various economic factors and local market conditions.
In summary, Lincoln has experienced a significant increase in homeownership rates and average home prices over the past decade, with a concurrent decrease in the renter population and average rent prices. The relationship between interest rates and homeownership rates generally follows expected patterns, although recent years have shown some deviation. The city's housing market appears to be transitioning towards a more owner-occupied model, with potential for continued growth in home values, albeit at a potentially slower pace in the coming years.
