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Rising Home Values and Ownership in Zip Code 03257: New London's Robust Housing Market
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
New London, located in zip code 03257 in New Hampshire, has experienced significant shifts in homeownership rates and housing prices over the past decade. This area, known for its picturesque New England charm and home to Colby-Sawyer College, has seen a notable increase in homeownership and average home prices, while rental trends have fluctuated.
The homeownership rate in New London has shown a remarkable upward trend, increasing from 79% in 2015 to 91% in 2022. This substantial rise in homeownership coincides with a significant increase in average home prices. In 2015, the average home price was $346,511, which steadily climbed to $588,736 by 2022, representing a 70% increase over seven years. This strong correlation suggests that rising home values have not deterred homeownership; instead, it may have encouraged more residents to invest in property as a means of building wealth.
Federal interest rates have played a crucial role in shaping homeownership trends in New London. The period from 2015 to 2020 saw relatively low interest rates, ranging from 0.13% to 0.38%, which likely contributed to the increased homeownership rates during this time. As interest rates remained low, mortgages became more affordable, potentially encouraging more residents to purchase homes. The sharp rise in homeownership from 85% in 2020 to 91% in 2022 occurred despite a jump in interest rates to 1.68% in 2022, indicating strong local demand for homeownership even in the face of rising borrowing costs.
Conversely, the percentage of renters in New London has decreased significantly, from 21% in 2015 to just 9% in 2022. This decline in renters coincided with fluctuations in average rent prices. The average rent peaked at $1,417 in 2015 and then experienced ups and downs, settling at $1,169 in 2022. Interestingly, despite the overall decrease in renters, rent prices have not seen a corresponding decline, suggesting a competitive rental market for the remaining rental properties. The population has remained relatively stable during this period, with only minor fluctuations, indicating that the shift from renting to owning is not primarily driven by population changes.
In 2023 and 2024, the housing market in New London continued its upward trajectory. The average home price reached $609,385 in 2023 and further increased to $630,314 in 2024, representing a 3.5% and 7.1% increase from 2022, respectively. This growth occurred despite the Federal Reserve raising interest rates to 5.02% in 2023 and 5.33% in 2024, levels not seen since before the 2008 financial crisis. These higher interest rates have not yet appeared to dampen the local housing market significantly.
Looking ahead, predictive models suggest that average home prices in New London will continue to rise over the next five years, albeit at a potentially slower rate due to the higher interest rate environment. We can expect average home prices to potentially reach around $700,000 by 2029. Rent prices are also projected to increase moderately, possibly reaching an average of $1,300 to $1,400 per month in the same timeframe, assuming the current trends continue.
In summary, New London has experienced a significant shift towards homeownership, with a corresponding increase in average home prices. This trend has persisted even in the face of rising interest rates, indicating strong local demand for housing. The rental market has shrunk but remains stable in terms of pricing. As the area continues to attract homeowners, it's likely to see further appreciation in property values, albeit potentially at a more moderate pace due to the current high-interest rate environment.
