Loading Content...
Rising Home Values and Shifting Ownership in West Calhoun: A Decade of Change
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
West Calhoun, a vibrant neighborhood in Minneapolis, Minnesota, has experienced significant changes in its housing market over the past decade. Located near the picturesque Lake Calhoun, this area has seen notable shifts in homeownership rates, average home prices, and rental costs. The neighborhood has generally trended towards increased renting, with fluctuations in both home values and rental prices.
The homeownership rate in West Calhoun has declined from 30% in 2013 to 25% in 2022. This change coincides with a substantial increase in average home prices, which rose from $186,857 in 2013 to $258,643 in 2022, representing a 38% increase. The inverse relationship between homeownership rates and average home prices suggests that rising property values may have made homeownership less attainable for many residents.
Federal interest rates have significantly influenced homeownership trends in West Calhoun. From 2013 to 2016, historically low interest rates ranging from 0.11% to 0.4% coincided with a decline in homeownership from 30% to 20%. As interest rates rose more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates stabilized around 19%. When interest rates dropped again in 2020 (0.38%) and 2021 (0.08%), there was a slight uptick in homeownership to 23%, potentially reflecting increased mortgage affordability.
The renter population in West Calhoun has grown considerably, with the percentage of renters increasing from 70% in 2013 to 75% in 2022. This trend aligns with the rise in average rent prices, which increased from $1,197 in 2013 to $1,378 in 2022, a 15% increase. The population of West Calhoun also grew during this period, from 1,892 residents in 2013 to 2,692 in 2022, suggesting a strong demand for rental properties in the area. The combination of population growth and rising rent prices indicates a robust rental market in the neighborhood.
In 2023 and 2024, West Calhoun experienced a slight decline in average home prices. The average home price in 2023 was $247,629, a 4.3% decrease from 2022. This trend continued into 2024, with prices further declining to $245,387. Concurrently, federal interest rates rose significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates may have contributed to the cooling of the housing market and the slight decrease in home prices.
Looking ahead, predictive models suggest that average home prices in West Calhoun may stabilize or experience modest growth over the next five years. Given the recent cooling trend and higher interest rates, prices are likely to increase at a slower rate compared to the past decade. Average rent prices, however, are projected to continue their upward trajectory, albeit at a more moderate pace. This forecast is based on the persistent demand for rental properties in the area and the overall population growth trend.
In summary, West Calhoun has transformed into a predominantly renter-occupied neighborhood with rising property values and rental costs. The inverse relationship between homeownership rates and average home prices, coupled with the influence of federal interest rates, has shaped the housing market dynamics. The recent stabilization of home prices and the continued growth in the rental market suggest that West Calhoun will likely maintain its appeal as a dynamic urban neighborhood with a mix of housing options for both owners and renters.
