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Rising Home Values and Ownership in Zip Code 03867: Rochester's Resilient 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
Rochester, New Hampshire, zip code 03867, is a growing city that has experienced significant changes in its housing market over the past decade. This area has seen a notable shift in homeownership rates and fluctuations in both average home prices and average rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Rochester has shown an overall upward trend, increasing from 61% in 2013 to 63% in 2022. This rise in homeownership coincided with a substantial increase in average home prices. In 2013, the average home price in the area was $149,907, which steadily climbed to $317,405 by 2022, representing a remarkable 111.7% increase over nine years. This trend suggests a strong correlation between rising property values and homeownership rates, possibly indicating growing confidence in the local real estate market.
Federal interest rates have played a significant role in shaping homeownership trends in Rochester. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.09% to 0.40%, which likely contributed to the initial increase in homeownership from 61% to 62%. As interest rates began to rise more significantly from 2017 (1.00%) to 2019 (2.16%), homeownership continued to climb, reaching 67% in 2019. This suggests that despite higher borrowing costs, other factors such as a strong local economy or desire for homeownership outweighed the impact of rising interest rates during this period.
Rental trends in Rochester have shown an inverse relationship to homeownership rates. The percentage of renters decreased from 39% in 2013 to 37% in 2022. Despite this decline, average rent prices have generally increased, albeit with some fluctuations. In 2013, the average rent was $1,064, which rose to $1,125 by 2022, representing a 5.7% increase. The most significant jump in rent prices occurred between 2020 and 2021, rising from $1,111 to $1,220, a 9.8% increase in a single year. This spike coincided with a slight increase in the renter population, possibly due to tightening in the housing market or economic uncertainties.
Looking at the most recent data, 2023 saw average home prices in Rochester reach $342,696, a further 8% increase from 2022. This trend continued into 2024, with prices climbing to $365,075, marking a 6.5% year-over-year increase. These rises occurred despite a significant jump in federal interest rates, which reached 5.02% in 2023 and 5.33% in 2024. This suggests a robust local housing market that has maintained strong demand even in the face of higher borrowing costs.
Applying predictive models to forecast 5-year trends, we anticipate continued growth in average home prices, albeit at a potentially slower rate due to the current high interest rate environment. Average home prices could potentially reach around $450,000 by 2029 if current trends persist. For rent prices, we expect a moderate upward trajectory, potentially reaching an average of $1,300 to $1,400 per month by 2029, assuming consistent economic growth and housing demand in the area.
In summary, Rochester's zip code 03867 has demonstrated a resilient and growing housing market over the past decade. The area has seen a steady increase in homeownership rates, substantial growth in average home prices, and moderate increases in average rent prices. Despite recent rises in interest rates, the housing market has continued to show strength, indicating a potentially promising outlook for both homeowners and investors in the coming years.
