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Southern Shores, NC: Rising Home Values and High Ownership Rates in a Coastal Town
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
Southern Shores, a town in North Carolina, has experienced significant changes in its housing market over the past decade. This coastal community has maintained a strong preference for homeownership, with consistently high owner-occupancy rates. The town has seen substantial fluctuations in both average home prices and average rent prices, reflecting broader economic trends and local market dynamics.
The homeownership rate in Southern Shores has remained impressively high, fluctuating between 88% and 93% from 2013 to 2022. This strong trend towards homeownership coincides with a substantial increase in average home prices. In 2010, the average home price was $428,650, which rose to $735,778 by 2022, representing a 71.6% increase over 12 years. Notably, the homeownership rate reached its peak of 93% in 2017 and 2018, when average home prices were $439,997 and $447,827 respectively. Despite the rising home prices, the high homeownership rates suggest a strong local economy and a preference for long-term residence in the area.
Federal interest rates have played a significant role in homeownership trends. From 2010 to 2021, interest rates remained historically low, ranging from 0.08% to 2.16%. This period of low interest rates coincided with the town's high homeownership rates, as affordable financing options likely encouraged home buying. For instance, in 2020, when the interest rate was just 0.38%, the homeownership rate stood at 92%.
Renter percentages in Southern Shores have been consistently low, ranging from 7% to 12% between 2013 and 2022. Interestingly, average rent prices have shown a sharp upward trend, especially in recent years. In 2013, the average rent was $977, which increased to $1,894 by 2022, a 93.9% rise. The most dramatic increase occurred between 2020 and 2021, when average rent jumped from $1,564 to $1,983, a 26.8% increase in just one year. This surge in rent prices, coupled with the low renter percentage, suggests a tight rental market with limited supply and high demand.
In 2023 and 2024, the housing market in Southern Shores continued its upward trajectory. The average home price reached $780,948 in 2023 and further increased to $803,467 in 2024, representing a 9.2% rise over two years. Simultaneously, federal interest rates climbed significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates may impact future homeownership trends and housing affordability in the area.
Looking ahead, predictive models suggest that both average home prices and rent prices in Southern Shores are likely to continue their upward trend over the next five years. Based on historical data and current market conditions, average home prices could potentially reach or exceed $900,000 by 2029. Average rent prices may similarly continue to rise, potentially surpassing $2,500 per month within the same timeframe. However, these projections may be influenced by various factors, including economic conditions, local development, and broader housing market trends.
In summary, Southern Shores has maintained a robust homeownership market despite rising home prices, likely supported by historically low interest rates until recent years. The rental market, while small, has seen substantial price increases, indicating high demand for the limited rental properties available. The recent spike in interest rates, coupled with consistently rising home and rent prices, may reshape the housing landscape in Southern Shores in the coming years, potentially affecting affordability and homeownership rates.
