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Rising Home Values and Stable Ownership in Zip Code 31406: Savannah's Resilient Real Estate 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
Zip code 31406 in Savannah, Georgia, has experienced significant changes in homeownership rates and property values over the past decade. This area, known for its proximity to historic Savannah and coastal amenities, has seen fluctuations in its real estate market that reflect both local and national economic trends.
The ownership percentage in zip code 31406 has shown a general upward trend, rising from 55% in 2016 to 59% in 2022. This increase in homeownership coincides with a substantial rise in average home prices. In 2016, the average home price was $157,436, which steadily increased to $259,250 by 2022, representing a 64.7% increase over six years. This trend suggests a growing preference for homeownership in the area, despite rising property values.
Federal interest rates have played a crucial role in shaping homeownership trends in zip code 31406. The period from 2016 to 2020 saw relatively low interest rates, ranging from 0.4% to 2.16%. This low-interest environment likely contributed to the increase in homeownership, as mortgage financing became more affordable. The ownership rate peaked at 61% in 2021 when interest rates were at a historic low of 0.08%, making homeownership particularly attractive.
Renter percentages in zip code 31406 have generally decreased as homeownership rates increased. The renter population decreased from 45% in 2016 to 41% in 2022. Despite this decline, average rent prices have shown an upward trend. In 2016, the average rent was $1,092, which increased to $1,228 by 2022, representing a 12.5% increase. This rise in rent prices, coupled with a decreasing renter population, suggests a tightening rental market, possibly due to increased demand for higher-quality rental properties or limited rental inventory.
In 2023 and 2024, the real estate market in zip code 31406 continued to evolve. The average home price reached $288,131 in 2023 and further increased to $309,473 in 2024, marking a significant 19.4% rise from 2022 to 2024. This substantial increase occurred despite a sharp rise in federal interest rates, which reached 5.02% in 2023 and 5.33% in 2024. These high interest rates would typically discourage homebuying, yet the continued price appreciation suggests strong demand in this zip code, possibly driven by local economic factors or the area's desirability.
Looking ahead, predictive models suggest that the upward trend in both average home prices and rent prices is likely to continue in zip code 31406 over the next five years. Home prices are projected to increase by approximately 5-7% annually, potentially reaching around $410,000 by 2029. Rent prices are expected to rise at a more moderate rate of 3-4% per year, potentially reaching about $1,450 by 2029. These projections assume continued economic stability and sustained demand for housing in the Savannah area.
In summary, zip code 31406 has demonstrated a robust real estate market characterized by increasing homeownership rates and rising property values. The area has shown resilience in the face of changing interest rates, with home prices continuing to appreciate even during periods of higher rates. The rental market, while shrinking in terms of percentage, has seen steady increases in average rent prices. These trends point to a dynamic and potentially competitive housing market in this Savannah zip code for the foreseeable future.
