Loading Content...
Rising Home Values and Strong Ownership in Providence, Kentucky: A Decade of Housing Market Dynamics
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Providence, Kentucky, a small urban area with a rich history in coal mining, has experienced notable shifts in its housing market over the past decade. This analysis explores the trends in homeownership rates, average home prices, and rent prices from 2013 to 2024, as well as their interrelationships.
From 2013 to 2022, Providence saw a slight decrease in homeownership rates, dropping from 70% to 68%. During this period, average home prices showed a steady upward trend. In 2013, the average home price was $40,090, which increased to $77,498 by 2022, representing a significant 93.3% growth over nine years. This substantial rise in home prices may have contributed to the slight decline in homeownership rates, as higher prices potentially made homeownership less accessible for some residents.
The federal interest rates play a crucial role in homeownership trends. In 2013, when interest rates were at a low 0.11%, homeownership in Providence was at 70%. As interest rates gradually increased to 1.68% by 2022, homeownership slightly decreased to 68%. This inverse relationship is typical, as lower interest rates generally make mortgages more affordable, encouraging homeownership.
Renter percentages in Providence showed a slight increase from 28% in 2019 to 32% in 2022. Interestingly, average rent prices displayed a more volatile trend. In 2013, the average rent was $337, which peaked at $1,097 in 2016 before declining to $932 in 2022. This represents a 176.6% increase from 2013 to 2022, despite some fluctuations. The increase in renter percentage, despite rising rent prices, might be attributed to the even steeper rise in home prices, making renting a more viable option for some residents.
In 2023 and 2024, the housing market in Providence continued its upward trajectory. The average home price reached $79,875 in 2023 and further increased to $82,303 in 2024, showing a consistent growth pattern. Simultaneously, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting homeownership affordability.
Looking ahead, based on the observed trends, we can project that average home prices in Providence may continue to rise over the next five years, potentially reaching around $95,000 by 2029. Average rent prices, while more volatile, might stabilize and gradually increase to approximately $1,100 by 2029. However, these projections are subject to various economic factors and local market conditions.
In summary, Providence has experienced a notable increase in both home prices and rent over the past decade, with a slight shift towards renting. The interplay between federal interest rates, housing prices, and homeownership rates highlights the complex dynamics of the local housing market. As the city moves forward, these trends will likely continue to shape its residential landscape and economic profile.
