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Pekin, Illinois: Rising Home Values and Shifting Ownership Trends Along the Illinois River
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
Pekin, Illinois, a city in Tazewell County and the hometown of Senator Everett Dirksen, has experienced significant changes in its housing market over the past decade. The city's homeownership rate has slightly declined from 73% in 2013 to 71% in 2022, coinciding with an increase in average home prices from $100,030 to $113,652 during the same period, representing a 13.6% rise.
Federal interest rates have played a crucial role in shaping Pekin's homeownership trends. From 2013 to 2016, historically low interest rates of 0.1% to 0.4% corresponded with stable homeownership rates of 72-73%. However, as interest rates increased from 2017 onwards, reaching 1.68% by 2022, homeownership rates slightly decreased to 71%, reflecting the impact of financing costs on property ownership.
The rental market in Pekin has shown an inverse relationship to homeownership trends. The percentage of renters increased from 26% in 2013 to 29% in 2022, while average rent prices rose steadily from $711 to $806 during the same period, a 13.4% increase. This trend suggests growing demand for rental properties, possibly due to changing demographics, job market dynamics, or challenges in entering the homeownership market.
In 2023 and 2024, Pekin's housing market continued to evolve. Average home prices reached $117,532 in 2023 and further increased to $126,268 in 2024, representing a significant 7.4% year-over-year growth. This substantial rise coincided with elevated federal interest rates of 5.02% in 2023 and 5.33% in 2024, potentially impacting affordability and future homeownership trends in the city.
Predictive models suggest that Pekin's housing market will likely continue its upward trajectory. Over the next five years, average home prices are projected to increase by approximately 15-20%, potentially reaching around $145,000 to $151,000 by 2029. Average rent prices are also expected to rise, albeit at a slightly slower pace, potentially increasing by 10-15% over the same period, which could bring average rents to approximately $885 to $925 per month.
In summary, Pekin's housing market has demonstrated resilience and growth over the past decade, with rising average home and rent prices despite slight declines in homeownership rates. The interplay between federal interest rates, local economic conditions, and demographic shifts has shaped these trends. As the city moves forward, the continued rise in both home values and rental costs suggests a dynamic and evolving housing landscape that will likely present both opportunities and challenges for Pekin's residents and potential newcomers.
