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Rising Home Values and Shifting Ownership in Raceland, Kentucky: A Small City's Housing Evolution
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Raceland, Kentucky, a small city in Greenup County, is notable for its rich railroad history and close-knit community. Over the past decade, Raceland has experienced fluctuations in homeownership rates and housing prices, reflecting broader economic trends and local market dynamics. The city has maintained a relatively high rate of homeownership, with average home prices showing a general upward trend, while average rent prices have also increased steadily.
The homeownership rate in Raceland has remained relatively stable, with slight fluctuations over the years. In 2013, the homeownership rate stood at 76%, and it peaked at 77% from 2015 to 2017. However, there has been a gradual decline since then, reaching 71% in 2022. This trend coincides with changes in average home prices. In 2013, the average home price was $89,945, and it increased to $97,267 by 2018, representing an 8.1% growth over five years. The average home price continued to rise, reaching $123,003 in 2022, a substantial 26.5% increase from 2018.
Federal interest rates have played a role in shaping homeownership trends in Raceland. From 2013 to 2015, when interest rates were extremely low (0.11% to 0.13%), homeownership rates in Raceland remained high at 76-77%. As interest rates began to rise gradually from 2016 onwards, reaching 1.83% in 2018, homeownership rates started to decline slightly. This trend suggests that higher interest rates may have made home financing less affordable for some residents, potentially contributing to the decrease in homeownership.
The rental market in Raceland has shown an inverse relationship to homeownership trends. As the percentage of renters increased from 23% in 2017 to 29% in 2022, average rent prices also rose significantly. In 2013, the average rent was $584, and it increased to $693 by 2018, a 18.7% rise. The upward trend continued, with average rent reaching $765 in 2022, representing a further 10.4% increase from 2018. This rise in rent prices coincided with a slight decrease in population from 3,380 in 2017 to 2,898 in 2022, suggesting that other factors such as housing supply and local economic conditions may have influenced the rental market more than population changes.
In 2023, the average home price in Raceland reached $127,257, showing a continued upward trend. As of 2024, the average home price has further increased to $132,990. These figures represent a 3.4% increase from 2023 to 2024, indicating a steady appreciation in home values. Notably, federal interest rates have also risen significantly, reaching 5.02% in 2023 and 5.33% in 2024. This increase in interest rates may impact future homebuying decisions and could potentially slow down the rate of home price appreciation.
Looking ahead, based on the observed trends, we can project that average home prices in Raceland are likely to continue their upward trajectory over the next five years, albeit potentially at a slower rate due to higher interest rates. Average home prices could reach approximately $150,000 to $160,000 by 2029. Similarly, average rent prices are expected to maintain their upward trend, potentially reaching around $850 to $900 per month by 2029, assuming current economic conditions persist.
In summary, Raceland has experienced a gradual shift from homeownership to renting over the past decade, with both average home prices and rent prices showing consistent increases. The interplay between federal interest rates, local economic factors, and housing market dynamics has shaped these trends. As the city moves forward, it will likely continue to see moderate growth in both home values and rental costs, reflecting the ongoing evolution of its housing market.
