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Rising Home Values and Shifting Ownership in Farmington, Illinois: A Decade of Housing Market Dynamics
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Farmington, Illinois, a small city in Fulton County, has experienced significant changes in its housing market over the past decade. This analysis examines the trends in homeownership rates, average home prices, and rental market dynamics from 2013 to 2024, as well as projections for the future.
The homeownership rate in Farmington has shown a declining trend, decreasing from 85% in 2013 to 73% in 2022. This shift coincided with fluctuations in average home prices, which started at $86,600 in 2013, dropped to a low of $79,540 in 2015, and then rebounded to reach $113,304 by 2022. This represents a 42.5% increase from the 2015 low, indicating a significant recovery and growth in the housing market. The inverse relationship between rising home prices and declining homeownership rates suggests that increasing property values may have made homeownership less accessible for some residents.
Federal interest rates have played a crucial role in shaping Farmington's homeownership trends. From 2013 to 2016, interest rates remained historically low at 0.1-0.4%, corresponding with stable homeownership rates between 83-88%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, homeownership rates declined more sharply. This trend aligns with the general principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
The rental market in Farmington has also shown interesting trends. The percentage of renters increased from 15% in 2013 to 27% in 2022. Average rent prices experienced significant fluctuations, starting at $582 in 2013, decreasing to $437 in 2017, and then rising sharply to $893 in 2022. This represents a 104% increase in average rent from 2017 to 2022. The growing renter population, combined with rising rent prices, suggests an increasing demand for rental properties in the city.
In 2023 and 2024, Farmington's housing market continued to evolve. The average home price reached $117,308 in 2023, showing continued growth. However, there was a slight decrease to $114,877 in 2024, indicating a potential cooling of the market. Federal interest rates rose significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates may have contributed to the slight decline in average home prices observed in 2024.
Looking ahead, predictive models suggest that average home prices in Farmington may continue to rise moderately over the next five years, potentially reaching around $125,000 by 2029. However, this growth rate may be slower compared to the rapid increases seen in recent years. Average rent prices are also expected to continue their upward trend, potentially surpassing $1,000 per month within the next five years if current trends persist.
In conclusion, Farmington has experienced a shift towards a higher proportion of renters, coupled with significant increases in both average home prices and average rent prices. The interplay between federal interest rates, homeownership rates, and housing costs has been evident, with higher interest rates coinciding with decreased homeownership. As the city moves forward, it's likely to see continued growth in its housing market, albeit at a potentially slower pace than in recent years.
