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Medicine Lake, Montana: Rising Home Values Amidst Steady 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
Medicine Lake, Montana, is a small community that has experienced fluctuations in population and housing dynamics over the past decade. The town has maintained a relatively high rate of homeownership, with average home prices showing a significant increase in recent years. Meanwhile, average rent prices have displayed a more volatile trend.
Homeownership rates in Medicine Lake have remained consistently high, ranging from 70% to 78% between 2013 and 2022. The percentage of owner-occupied housing units peaked at 78% in 2022, up from 70% in 2017. This trend coincides with a substantial increase in average home prices. From 2019 to 2022, average home prices rose from $104,426 to $155,635, representing a 49% increase over just three years. This sharp rise in home values may have encouraged more residents to invest in homeownership, despite the potential for higher costs.
The relationship between federal interest rates and homeownership rates in Medicine Lake appears to follow the general trend of lower interest rates encouraging homeownership. For instance, as interest rates remained low from 2013 to 2021 (ranging from 0.08% to 2.16%), homeownership rates generally stayed above 70%. The slight dip in homeownership to 70% in 2017 coincided with a modest increase in interest rates to 1%. However, as interest rates began to rise more significantly in 2022 to 1.68%, homeownership in Medicine Lake actually increased to 78%, suggesting other local factors may have influenced this trend.
Renter percentages in Medicine Lake have fluctuated between 20% and 29% from 2013 to 2022. The highest percentage of renters was observed in 2017 at 29%, coinciding with the lowest homeownership rate. Average rent prices showed considerable variation during this period. In 2013, the average rent was $1,011, which increased to a peak of $1,485 in 2017. However, by 2022, average rent had decreased to $964, representing a 35% drop from its peak. This decrease in rent prices occurred despite a slight increase in population from 156 in 2017 to 190 in 2022, suggesting that other factors such as local economic conditions or housing supply may have influenced rental costs.
In 2023 and 2024, average home prices in Medicine Lake showed a slight decline, dropping from $155,635 in 2022 to $154,083 in 2023 and further to $148,413 in 2024. This cooling of the housing market coincides with a significant increase in federal interest rates, which rose to 5.02% in 2023 and 5.33% in 2024. These higher interest rates likely contributed to the softening of home prices by making mortgages more expensive and potentially reducing buyer demand.
Looking ahead, based on recent trends and current economic conditions, we can expect average home prices in Medicine Lake to stabilize or potentially decrease slightly over the next five years. The high interest rates may continue to exert downward pressure on home prices. Average rent prices, which have been decreasing since 2017, may begin to stabilize or increase modestly as the rental market adjusts to changing economic conditions and potential shifts in housing preferences.
In summary, Medicine Lake has maintained a strong homeownership rate despite fluctuations in home prices and interest rates. The recent cooling of the housing market, coupled with rising interest rates, suggests a potential shift in the local real estate landscape. The rental market has shown volatility, with recent trends indicating lower average rents. These dynamics will likely continue to shape the housing market in Medicine Lake over the coming years.
