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Rising Home Values and High Ownership Rates in Zip Code 35907: A Resilient Housing Market in Southside, Alabama
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
Zip code 35907, located in Southside, Alabama, is characterized by high homeownership rates and steadily increasing property values. This suburban community has experienced notable growth in population and housing market dynamics over the past decade.
The homeownership rate in zip code 35907 has remained consistently high, hovering around 90% throughout most of the observed period. In 2013, the area boasted a 93% homeownership rate, which slightly decreased to 86% by 2018 before rebounding to 90% in 2022. This strong preference for homeownership has coincided with a significant increase in average home prices. The average home price in the area rose from $145,877 in 2010 to $242,646 in 2022, representing a substantial 66% increase over 12 years.
The relationship between federal interest rates and homeownership rates in this area appears to follow the general trend of lower interest rates encouraging homeownership. For instance, when interest rates were at historic lows between 2020 and 2021 (0.38% and 0.08% respectively), the homeownership rate in the zip code increased from 89% to 90%. This aligns with the principle that lower interest rates make mortgages more affordable, potentially driving up homeownership.
Renter percentages in zip code 35907 have fluctuated slightly but remained relatively low. The renter-occupied housing peaked at 14% in 2018 before decreasing to 10% in 2022. Average rent prices have shown some volatility, ranging from a high of $1,191 in 2013 to a low of $923 in 2016. By 2022, the average rent had settled at $947. The relatively stable and low renter percentage, coupled with the area's growing population (from 8,424 in 2010 to 9,676 in 2022), suggests a strong preference for homeownership in this community.
In 2023 and 2024, the housing market in zip code 35907 continued its upward trajectory. The average home price reached $250,973 in 2023 and further increased to $262,989 in 2024. This represents a 8.4% increase from 2022 to 2024. Notably, this price growth occurred despite a significant rise in federal interest rates, which climbed to 5.02% in 2023 and 5.33% in 2024.
Looking ahead, predictive models suggest that the upward trend in average home prices is likely to continue over the next five years, albeit potentially at a more moderate pace due to higher interest rates. Average rent prices may also see a gradual increase, driven by overall housing market appreciation and potential demand from those priced out of homeownership due to rising home values and interest rates.
In summary, zip code 35907 demonstrates a robust housing market with a strong preference for homeownership. The area has experienced significant appreciation in home values over the past decade, maintained high homeownership rates, and shown resilience in the face of changing economic conditions. The interplay between interest rates, home prices, and ownership rates underscores the dynamic nature of this local real estate market.
