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Ottumwa, Iowa: Rising Home Values and Shifting Ownership in Tom Arnold's Hometown
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
Ottumwa, Iowa, is a city with a rich history and a dynamic real estate market. Located in the southeastern part of the state, Ottumwa is known for its industrial heritage and as the hometown of famous actor Tom Arnold. Over the past decade, the city has experienced notable shifts in homeownership rates, average home prices, and average rent prices, reflecting broader economic trends and local market conditions.
From 2013 to 2022, Ottumwa saw a gradual decline in homeownership rates, dropping from 69% to 61%. During this same period, average home prices demonstrated an overall upward trend, rising from $73,251 in 2013 to $102,490 in 2022, representing a substantial increase of 39.9%. This inverse relationship suggests that as home prices increased, fewer residents were able to afford homeownership, leading to a shift towards renting.
The federal interest rate trends appear to have influenced homeownership rates in Ottumwa. From 2013 to 2016, when interest rates remained historically low (below 0.5%), homeownership rates held steady at around 68-69%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, homeownership rates declined more noticeably, dropping to 61% by 2022. This trend aligns with the general economic principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
Conversely, the percentage of renters in Ottumwa increased from 30% in 2013 to 39% in 2022. This rise in renter occupancy coincided with fluctuations in average rent prices. Average rents rose from $618 in 2013 to $829 in 2022, an increase of 34.1%. Notably, there were some fluctuations in rent prices during this period, with a significant jump from $725 in 2020 to $822 in 2021, possibly reflecting increased demand for rental properties as homeownership became less attainable for some residents.
In 2023 and 2024, Ottumwa's real estate market continued to evolve. Average home prices reached $107,345 in 2023 and further increased to $113,982 in 2024, representing a 6.2% year-over-year growth. This upward trajectory occurred despite the federal interest rate climbing to 5.02% in 2023 and 5.33% in 2024, indicating a robust local housing market that withstood higher borrowing costs.
Looking ahead, predictive models suggest that average home prices in Ottumwa may continue to rise over the next five years, potentially reaching around $130,000 by 2029 if current trends persist. Average rent prices are also expected to increase, potentially surpassing $900 per month within the same timeframe. These projections assume continued economic growth and steady demand for housing in the area.
In summary, Ottumwa has experienced a notable shift from homeownership to renting over the past decade, driven by rising home prices and fluctuating interest rates. The city's real estate market has shown resilience, with both home values and rent prices trending upward despite economic challenges. As Ottumwa continues to evolve, these trends suggest a changing landscape for residents, with potential implications for housing affordability and community development in the coming years.
