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Rising Home Values and Ownership in Parma Heights, Ohio: A Decade of Housing Market Resilience
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
Parma Heights, Ohio, is a suburban city located in Cuyahoga County. With a population of 20,706 in 2022 and an area of 4.2 square miles, this compact community has experienced interesting housing market dynamics over the past decade. The city has maintained a relatively stable balance between homeowners and renters, with a slight increase in homeownership rates in recent years. Average home prices have shown steady growth, while average rent prices have experienced moderate fluctuations.
The homeownership rate in Parma Heights has seen a gradual increase from 53% in 2015 to 58% in 2022. This upward trend in homeownership coincides with a significant rise in average home prices. In 2015, the average home price was $103,080, which steadily climbed to $176,289 by 2022, representing a substantial 71% increase over seven years. This trend suggests that despite rising prices, more residents were able to enter the housing market, possibly due to favorable economic conditions or attractive mortgage terms.
Federal interest rates have played a crucial role in shaping homeownership trends in Parma Heights. The period from 2015 to 2020 saw relatively low interest rates, ranging from 0.13% to 2.16%. This low-interest environment likely contributed to the increase in homeownership, as it made mortgage financing more affordable for potential buyers. The slight dip in homeownership from 56% in 2020 to 55% in 2019 might be attributed to the marginal increase in interest rates during that time, which rose from 0.38% in 2020 to 2.16% in 2019.
The renter population in Parma Heights has remained relatively stable, with a slight decrease from 44% in 2017 to 42% in 2022. Average rent prices have shown moderate growth during this period, increasing from $933 in 2017 to $994 in 2022, a 6.5% rise. This modest increase in rent prices, coupled with the growing homeownership rate, suggests that some renters may have transitioned to homeownership, taking advantage of the low-interest-rate environment.
In 2023 and 2024, Parma Heights experienced continued growth in average home prices. The average home price reached $185,929 in 2023 and further increased to $196,649 in 2024. This represents a 5.5% and 5.8% year-over-year increase, respectively. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting future homeownership trends.
Looking ahead, based on historical trends and current market conditions, we can expect average home prices in Parma Heights to continue their upward trajectory over the next five years. Projecting the current growth rate, average home prices could potentially reach around $260,000 by 2029. Average rent prices are also likely to increase, albeit at a more moderate pace, potentially reaching approximately $1,100 per month in the same timeframe.
In summary, Parma Heights has demonstrated a resilient housing market characterized by increasing homeownership rates and steadily rising home values. The interplay between federal interest rates, homeownership trends, and property values has shaped a dynamic real estate landscape in this Ohio city. As the community continues to evolve, the balance between homeowners and renters, along with the trajectory of housing prices, will play a crucial role in defining Parma Heights' residential character in the coming years.
