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Pontiac's Housing Market: Rising Home Values and Shifting Ownership in the Automotive City
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Pontiac, Illinois, a city with a rich history dating back to its founding in 1837, has experienced notable shifts in its housing market over the past decade. Located in Livingston County and spanning 8.63 square miles, this charming Midwest city has seen fluctuations in homeownership rates, average home prices, and average rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Pontiac has shown a gradual decline from 2013 to 2022. In 2013, 71% of residents owned their homes, but by 2022, this figure had decreased to 64%. Interestingly, this decline in homeownership coincided with a rise in average home prices. In 2013, the average home price in Pontiac was $95,298, which steadily increased to $122,435 by 2022, representing a 28.5% increase over nine years.
The relationship between federal interest rates and homeownership rates in Pontiac follows a generally expected pattern. From 2013 to 2015, when interest rates were historically low (ranging from 0.11% to 0.13%), homeownership rates remained relatively stable at around 70%. However, as interest rates began to rise from 2016 onwards, reaching 1.68% by 2022, homeownership rates declined to 64%. This trend aligns with the principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
Renter percentages in Pontiac have inversely mirrored the homeownership trend, increasing from 29% in 2013 to 36% in 2022. Average rent prices have also seen an upward trajectory during this period. In 2013, the average rent was $652, which increased to $766 by 2022, marking a 17.5% rise. This increase in both renter percentages and average rent prices occurred despite a slight decline in population from 13,747 in 2013 to 13,095 in 2022, suggesting a shift in housing preferences or affordability constraints.
As of 2024, the average home price in Pontiac has reached $134,914, continuing the upward trend observed in previous years. This represents a 10.2% increase from the 2022 average price of $122,435. Concurrently, the federal interest rate has risen to 5.33% in 2024, significantly higher than the 1.68% rate in 2022. This sharp increase in interest rates could potentially impact homebuying affordability and market dynamics in the coming years.
Looking ahead, predictive models suggest that average home prices in Pontiac may continue to rise over the next five years, potentially reaching around $150,000 by 2029. Average rent prices are also expected to follow this upward trend, potentially increasing to approximately $850 per month within the same timeframe. These projections are based on historical trends and current market conditions.
In summary, Pontiac has experienced a gradual shift towards renting, with homeownership rates declining from 71% to 64% between 2013 and 2022. Despite this trend, average home prices have steadily increased, rising by 28.5% during the same period. Average rent prices have also shown consistent growth, increasing by 17.5% from 2013 to 2022. The recent sharp rise in federal interest rates, coupled with continuing increases in home prices, may further influence housing market dynamics in Pontiac in the coming years.
