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Shaker Heights, Ohio: Rising Home Values and Declining Ownership in a Historic Planned Community
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
Shaker Heights, Ohio, is a vibrant suburban city located just east of Cleveland. Known for its diverse architecture and commitment to racial integration, this community has experienced notable shifts in its housing market over the past decade. The city has seen a gradual decrease in homeownership rates, while average home prices and average rent have generally trended upward.
The homeownership rate in Shaker Heights has experienced a steady decline from 2013 to 2022. In 2013, 62% of housing units were owner-occupied, but by 2022, this figure had dropped to 60%. Concurrently, average home prices have shown a significant upward trend. In 2013, the average home price was $180,270, and by 2022, it had risen to $283,088, representing a 57% increase over this period. This inverse relationship suggests that rising home prices may have made homeownership less attainable for some residents.
Federal interest rates have played a role in homeownership trends in Shaker Heights. From 2013 to 2016, when interest rates were historically low (ranging from 0.11% to 0.40%), homeownership rates remained relatively stable at around 63-64%. However, as interest rates began to rise more significantly from 2017 onwards, reaching 1.68% in 2022, homeownership rates started to decline, dropping to 60% by 2022. This trend aligns with the general principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
Renter percentages in Shaker Heights have shown a corresponding increase as homeownership rates declined. In 2013, 37% of housing units were renter-occupied, and this figure rose to 40% by 2022. Average rent prices have also trended upward during this period, albeit with some fluctuations. In 2013, the average rent was $1,050, and it increased to $1,171 by 2022, representing an 11.5% increase. The population of Shaker Heights has remained relatively stable during this period, with a slight increase from 28,059 in 2013 to 29,157 in 2022, suggesting that the rise in renter percentages and rent prices may be more influenced by market factors than population growth.
In 2023 and 2024, Shaker Heights has continued to see growth in average home prices. The average home price in 2023 was $293,975, and in 2024 it further increased to $311,445. This represents a 10% increase from 2022 to 2024. Concurrently, federal interest rates have risen significantly, reaching 5.02% in 2023 and 5.33% in 2024. These high interest rates may put additional pressure on homeownership rates in the coming years.
Looking ahead, based on historical trends and current market conditions, we can forecast potential 5-year trends for Shaker Heights. Average home prices are likely to continue their upward trajectory, potentially reaching around $350,000-$375,000 by 2029. Average rent prices may also continue to increase, albeit at a slower rate, potentially reaching $1,300-$1,400 per month in the same timeframe. However, these projections are subject to various economic factors and market conditions.
In summary, Shaker Heights has experienced a gradual shift towards a higher percentage of renters, coupled with rising average home prices and rent costs. The inverse relationship between homeownership rates and home prices, influenced by fluctuating interest rates, has been a key factor in shaping the city's housing market. As the city moves forward, balancing affordability with market growth will likely be a crucial consideration for maintaining its diverse and vibrant community.
