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Zip Code 07201: Rising Home Values and Declining Ownership in Elizabeth, NJ
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 07201, located in Elizabeth, New Jersey, has experienced significant shifts in homeownership, average home prices, and average rent prices over the past decade. This urban area has seen a notable trend towards renting, with a concurrent rise in both average home values and average rent prices.
The homeownership rate in zip code 07201 has steadily declined from 29% in 2013 to 22% in 2022. This decline coincides with a substantial increase in average home prices, which rose from $155,165 in 2013 to $386,589 in 2022, representing a 149% increase over nine years. The inverse relationship between homeownership rates and average home prices suggests that rising property values may be pricing out potential buyers in this area.
Federal interest rates have played a role in shaping homeownership trends. From 2013 to 2016, when interest rates were extremely low (ranging from 0.11% to 0.40%), homeownership rates in the zip code remained relatively stable, hovering around 27-30%. However, as interest rates began to rise more significantly from 2017 onwards, reaching 1.68% by 2022, homeownership rates declined more sharply, dropping to 22%. This trend aligns with the general principle that higher interest rates can make mortgages less affordable, potentially discouraging homeownership.
As homeownership declined, the percentage of renters in zip code 07201 increased from 71% in 2013 to 78% in 2022. During this period, average rent prices also rose, albeit less dramatically than home prices. Average rent increased from $1,176 in 2013 to $1,269 in 2022, a 7.9% increase. The population in the zip code grew from 26,290 in 2013 to 28,580 in 2022, potentially contributing to increased demand for rental properties and supporting the upward trend in rent prices.
Looking at the most recent data, average home prices in zip code 07201 continued their upward trajectory, reaching $423,778 in 2023 and $461,093 in 2024. This represents a further 19.3% increase from 2022 to 2024. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting affordability and homeownership rates in the area.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in zip code 07201 will continue to rise, potentially reaching around $550,000 by 2029. Average rent prices are also expected to increase, possibly surpassing $1,400 per month within the same timeframe. These projections assume a continuation of current economic conditions and housing market trends.
In summary, zip code 07201 has experienced a clear shift towards renting, with homeownership rates declining as average home prices have significantly increased. The area has seen moderate growth in average rent prices, coupled with population growth. The recent sharp rise in interest rates may further impact homeownership trends. As the area continues to evolve, it's likely to see ongoing changes in its housing market dynamics, with a potential continuation of the trend towards renting and rising property values.
