Loading Content...
Rising Home Values and Stable Ownership in Zip Code 55391: Orono's Resilient Housing Market
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Zip code 55391, located in Orono, Minnesota, showcases an intriguing real estate landscape characterized by high homeownership rates and substantial property values. This area has experienced notable shifts in its housing market over the past decade, with fluctuations in both ownership percentages and average home prices.
The homeownership rate in zip code 55391 has remained relatively stable, with a slight decline from 76% in 2013 to 75% in 2022. During this period, average home prices have shown a significant upward trend. In 2013, the average home price was $522,333, which steadily increased to $905,937 by 2022, representing a remarkable 73.4% growth over nine years. This substantial appreciation in home values, coupled with the consistently high homeownership rate, suggests a strong and desirable housing market in the area.
Federal interest rates have played a crucial role in shaping homeownership trends in zip code 55391. From 2013 to 2016, interest rates remained extremely low, hovering around 0.1% to 0.4%. During this period, the homeownership rate slightly decreased from 76% to 74%, possibly due to rising home prices making it more challenging for new buyers to enter the market despite favorable financing conditions. As interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, the homeownership rate stabilized at 75%, indicating a resilient market where existing homeowners maintained their properties despite higher borrowing costs.
The rental market in zip code 55391 has also experienced notable changes. The percentage of renters increased from 24% in 2013 to 28% in 2019, before settling back to 25% in 2022. Average rent prices have shown volatility, rising from $1,590 in 2013 to $1,645 in 2014, then fluctuating before reaching $2,008 in 2022. This represents a 26.3% increase in average rent over the decade. The population growth from 15,237 in 2013 to 16,713 in 2022 likely contributed to the upward pressure on both home prices and rents.
In 2023 and 2024, the housing market in zip code 55391 continued its upward trajectory. The average home price reached $920,899 in 2023 and further increased to $925,594 in 2024, showing a 1.7% and 0.5% year-over-year growth, respectively. This growth occurred despite the significant rise in federal interest rates, which stood at 5.02% in 2023 and 5.33% in 2024, demonstrating the robust demand for housing in this area even in a high-interest rate environment.
Looking ahead, predictive models suggest that the strong housing market in zip code 55391 is likely to continue its upward trend over the next five years. Average home prices are projected to increase by approximately 2-3% annually, potentially reaching around $1,050,000 by 2029. Average rent prices are expected to follow a similar trajectory, with an estimated annual growth of 3-4%, potentially surpassing $2,300 per month by 2029.
In summary, zip code 55391 in Orono, Minnesota, presents a robust housing market characterized by high homeownership rates and steadily appreciating property values. Despite fluctuations in interest rates and modest changes in the rental market, the area has maintained its attractiveness to both homeowners and investors. The consistent population growth and the area's desirability suggest that this positive trend in both home values and rental prices is likely to continue in the foreseeable future.
