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Zip Code 07103: Newark's Resilient Housing Market Sees Average Home Values Double Amid Stable Ownership Rates
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
Zip code 07103, located in Newark, New Jersey, is a densely populated urban area that has experienced significant demographic and economic changes over the past decade. This analysis explores the trends in homeownership, average home prices, and average rent prices in this dynamic neighborhood. The homeownership rate in zip code 07103 has remained relatively stable over the years, with a slight decline from 23% in 2013 to 22% in 2022. During this same period, average home prices have shown a remarkable increase. In 2013, the average home price was $143,057, and by 2022, it had risen to $347,107, representing a substantial 142.6% increase over nine years. This trend suggests that while homeownership rates have remained steady, the value of owned properties has significantly appreciated.
The relationship between federal interest rates and homeownership rates in this zip code appears to be somewhat atypical. Despite historically low interest rates between 2013 and 2021 (ranging from 0.08% to 1.68%), the homeownership rate did not increase as one might expect. This could indicate that other factors, such as local economic conditions or housing availability, may have a stronger influence on homeownership in this area than interest rates alone.
Renter occupancy in zip code 07103 has remained the dominant form of housing, increasing slightly from 77% in 2013 to 78% in 2022. Average rent prices have also shown an upward trend, albeit less dramatic than home prices. In 2013, the average rent was $1,064, and by 2022, it had increased to $1,086, representing a modest 2.1% rise. Interestingly, there was a spike in average rent to $1,187 in 2021, followed by a decrease in 2022. This trend coincides with a population increase from 33,614 in 2019 to 37,336 in 2022, suggesting that population growth may have influenced rental demand and prices.
Looking at the most recent data, the average home price in zip code 07103 decreased slightly from $347,107 in 2022 to $344,039 in 2023, representing a 0.9% decline. However, in 2024, the average home price rebounded to $361,527, showing a 5.1% increase from 2023. This uptick occurred despite the federal interest rate rising to 5.33% in 2024, indicating strong local demand for housing that outweighed the potential dampening effect of higher borrowing costs.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in zip code 07103 will continue to rise, albeit at a more moderate pace. Based on the historical data and current economic conditions, we project an average annual increase of 3-5% in home prices over the next five years. For rent prices, we expect a slightly more stable trajectory, with projected annual increases of 1-3%, assuming continued population growth and demand for rental properties in the area.
In summary, zip code 07103 in Newark has demonstrated resilience in its housing market, with significant appreciation in home values despite stable homeownership rates. The rental market remains dominant and has shown steady growth in both occupancy and prices. The recent rebound in home prices, even in the face of rising interest rates, suggests a robust local housing demand that is likely to support continued growth in both the ownership and rental markets in the coming years.
