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Rising Home Values and Stable Ownership: Shepherd's Housing Market Evolution
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Shepherd, a vibrant neighborhood in Chattanooga, Tennessee, has experienced significant changes in its real estate market over the past decade. This analysis focuses on the trends in homeownership rates, average home prices, and rent prices from 2013 to 2024, highlighting the neighborhood's resilience and growth. The homeownership rate in Shepherd has remained relatively stable, fluctuating between 43% and 48% from 2013 to 2022. During this period, average home prices showed a substantial upward trend, increasing from $111,830 in 2013 to $221,372 in 2022, representing a 98% increase over nine years. This significant rise in home values did not seem to have a major impact on homeownership rates, suggesting that other factors may have influenced ownership decisions in the neighborhood. Federal interest rates have played a role in shaping homeownership trends in Shepherd. From 2013 to 2016, when interest rates were historically low (ranging from 0.09% to 0.40%), homeownership rates remained relatively stable around 46-47%. As interest rates began to rise more significantly from 2017 (1.00%) to 2019 (2.16%), homeownership rates showed slight variations but generally stayed within the 46-48% range. The dramatic drop in interest rates in 2020 and 2021 (to 0.38% and 0.08% respectively) coincided with a slight decrease in homeownership to 45% and 43%, possibly due to increased competition in the housing market from investors and other buyers taking advantage of low rates.
Renter percentages in Shepherd have shown a complementary trend to homeownership rates, ranging from 51% to 57% between 2013 and 2022. Average rent prices have generally increased over this period, starting at $916 in 2013 and reaching $1,010 in 2022, a 10.3% increase. Notably, there was a significant spike in average rent to $1,263 in 2021, coinciding with the lowest homeownership rate of 43% observed during this period. This spike may have been influenced by the population increase to 5,311 in 2021, the highest in the dataset, potentially creating more demand for rental properties.
In 2023 and 2024, the Shepherd neighborhood continued to see growth in average home prices, reaching $234,167 in 2023 and further increasing to $243,944 in 2024. This represents a 5.7% and 4.2% year-over-year increase respectively. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, marking the highest rates in over a decade. These higher interest rates may impact future homeownership trends and affordability in the neighborhood.
Looking ahead, based on historical trends and current market conditions, we can project continued growth in both average home prices and rent prices over the next five years. Average home prices could potentially reach around $300,000 by 2029, assuming a conservative annual growth rate of 4-5%. Average rent prices may increase to approximately $1,200-$1,300 per month, factoring in historical growth patterns and potential market adjustments.
In summary, Shepherd has demonstrated resilience in its real estate market with steadily increasing average home prices despite fluctuations in homeownership rates. The neighborhood has experienced a general upward trend in both average home values and rent prices, influenced by factors such as population changes, federal interest rates, and broader economic conditions. As we move forward, the interplay between these factors will continue to shape the housing landscape in this dynamic Chattanooga neighborhood.
