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Norwood, Illinois: Rising Home Values and Stable Ownership in a Small Community
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
Norwood, Illinois, a small community in Peoria County, has experienced significant changes in its housing market over the past decade. With a population of 2,158 in 2022 and an area of just 0.31 square miles, this compact village has seen notable shifts in homeownership rates, average home prices, and average rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Norwood has fluctuated between 2013 and 2022. Starting at a high 93% in 2013, it decreased to 84% by 2019 but rebounded to 91% in 2022. Concurrently, average home prices have generally trended upward. In 2015, the average home price was $75,172, rising to $92,121 by 2022, representing a 22.5% increase over seven years. This upward trend in home prices, despite some fluctuations in ownership rates, suggests a growing desirability of the area and potential appreciation of property values.
Federal interest rates have influenced homeownership trends in Norwood. From 2013 to 2016, historically low interest rates of 0.1% to 0.4% corresponded with high homeownership rates of 89% to 93%. As interest rates rose more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates declined, reaching a low of 84% in 2019. This trend aligns with the general principle that lower interest rates tend to encourage homeownership by making mortgages more affordable.
Renter percentages and average rent prices in Norwood have shown an interesting relationship. In 2013, only 7% of residents were renters, with an average rent of $836. By 2019, the renter percentage had more than doubled to 16%, with average rent increasing to $1,040. This 24.4% increase in average rent over six years coincided with a decrease in population from 2,498 in 2013 to 2,299 in 2019, suggesting that despite fewer residents, demand for rentals increased, possibly due to changing demographics or economic factors.
In 2023 and 2024, Norwood has seen continued growth in average home prices. The average home price reached $98,330 in 2023 and further increased to $105,320 in 2024, representing a 14.3% increase from 2022 to 2024. This substantial rise occurred despite the federal interest rate climbing to 5.02% in 2023 and 5.33% in 2024, indicating strong local demand for housing even in a higher interest rate environment.
Looking ahead, predictive models suggest that average home prices in Norwood may continue to rise over the next five years, potentially reaching around $120,000 by 2029 if current trends persist. Average rent prices are also expected to increase, potentially surpassing $1,200 per month within the same timeframe. However, these projections are subject to various economic factors and local market conditions.
In summary, Norwood has maintained a high rate of homeownership despite fluctuations, with recent years showing a strong rebound. Average home prices have consistently increased, even in the face of rising interest rates, indicating robust demand for housing in the area. The rental market has also seen growth, both in terms of renter percentages and average rent prices. These trends suggest that Norwood remains an attractive location for both homeowners and renters, with potential for continued growth in property values and rental rates in the coming years.
