Loading Content...
Ocoee, Tennessee: Home Values Double Amid Population Growth and Interest Rate Fluctuations
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Ocoee, Tennessee, is a small community that has experienced significant demographic and housing market changes over the past decade. The city has seen fluctuations in homeownership rates and notable increases in both average home prices and average rent prices. This analysis will explore these trends and their interrelationships.
The homeownership rate in Ocoee has shown considerable variation from 2013 to 2022. In 2013, the homeownership rate stood at 83%, but it experienced a decline to its lowest point of 61% in 2019. However, there has been a recent resurgence, with the rate climbing back to 74% by 2022. Correspondingly, average home prices have shown a steady upward trend. In 2013, the average home price was $119,299, and by 2022, it had more than doubled to $276,375. This substantial increase in home values may have contributed to the temporary dip in homeownership rates as affordability became a challenge for some residents.
Federal interest rates have played a significant role in shaping homeownership trends in Ocoee. The period from 2013 to 2016 saw historically low interest rates, hovering around 0.1% to 0.4%. During this time, homeownership rates remained relatively high, above 75%. As interest rates began to rise from 2017 onwards, reaching 2.16% in 2019, we observed a corresponding decline in homeownership rates to 61%. However, the sudden drop in interest rates to 0.08% in 2021 coincided with a rebound in homeownership to 72%, demonstrating the inverse relationship between interest rates and homeownership.
Renter percentages in Ocoee have mirrored the inverse of homeownership rates, ranging from a low of 13% in 2014 to a peak of 39% in 2019. Average rent prices have shown an overall upward trend, albeit with some fluctuations. In 2013, the average rent was $704, which decreased to $597 in 2015 before rising again to reach $832 in 2022. The increase in rental prices, particularly from 2019 to 2022, may be attributed to growing demand as the population increased from 1,191 to 1,623 during this period.
In 2023 and 2024, Ocoee's housing market continued to evolve. The average home price in 2023 was $275,892, showing a slight decrease from 2022. However, in 2024, the average home price rebounded to $289,575. These changes occurred against the backdrop of significantly higher federal interest rates, which rose to 5.02% in 2023 and 5.33% in 2024. Despite these high interest rates, the housing market in Ocoee has demonstrated resilience with continued price appreciation.
Looking ahead, predictive models suggest that average home prices in Ocoee may continue to rise over the next five years, albeit at a more moderate pace due to the current high interest rate environment. We can expect average home prices to potentially reach around $320,000 to $340,000 by 2029. Average rent prices are also likely to continue their upward trajectory, potentially reaching $900 to $950 per month in the same timeframe, driven by population growth and housing demand.
In summary, Ocoee has experienced significant changes in its housing market over the past decade. The interplay between homeownership rates, average home prices, and federal interest rates has been evident, with periods of low interest rates generally corresponding to higher homeownership rates. The community has seen substantial appreciation in both home values and rental prices, reflecting its growing attractiveness and population increase. As we look to the future, moderate growth in both home prices and rents is anticipated, shaped by broader economic factors and local demographic trends.
