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Zip Code 11232: Brooklyn's Evolving Real Estate Market - Average Home Values and Ownership Trends in a Gentrifying Industrial Area
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 11232 in Brooklyn, New York, is a densely populated urban area covering just 2.01 square miles. This compact neighborhood has experienced significant changes in homeownership rates, average home prices, and average rent prices over the past decade.
The homeownership rate in zip code 11232 has remained relatively stable, fluctuating between 21% and 24% from 2013 to 2022. During this period, average home prices saw a substantial increase. In 2013, the average home price was $426,040, which rose dramatically to $674,370 by 2022, representing a 58.3% increase over nine years. This trend suggests that despite rising home values, the proportion of homeowners in the area remained consistent.
Federal interest rates play a crucial role in homeownership trends. From 2013 to 2016, when interest rates were exceptionally low (ranging from 0.11% to 0.40%), the homeownership rate in zip code 11232 increased slightly from 22% to 24%. This aligns with the general trend of lower interest rates encouraging homeownership due to more affordable financing options. However, as interest rates began to rise from 2017 onwards, the homeownership rate remained stable at 24%, indicating other factors may have influenced homeownership decisions in this area.
The renter population in zip code 11232 has consistently comprised the majority of residents, ranging from 76% to 78% between 2013 and 2022. Average rent prices have shown a steady upward trend during this period. In 2013, the average rent was $1,378, which increased to $1,670 by 2022, representing a 21.2% rise over nine years. The population in the zip code fluctuated during this time, peaking at 32,088 in 2014 and declining to 29,697 in 2022. Despite these population changes, the high percentage of renters and increasing rent prices suggest a strong demand for rental properties in the area.
In 2023 and 2024, the average home prices in zip code 11232 experienced a decline. The average home price in 2023 was $631,408, a 6.4% decrease from 2022. This downward trend continued into 2024, with the average home price further dropping to $621,623. Concurrently, federal interest rates rose significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates likely contributed to the cooling of the housing market and the decrease in average home prices.
Looking ahead, our predictive models forecast a potential stabilization in average home prices over the next five years, with modest growth expected. Average rent prices are projected to continue their upward trajectory, albeit at a slower pace than observed in previous years. These predictions are based on historical trends, current economic conditions, and the assumption that interest rates will remain relatively high in the near term.
In summary, zip code 11232 in Brooklyn has maintained a consistent ratio of homeowners to renters over the past decade, despite significant increases in both average home prices and average rent prices. The recent decline in average home prices, coupled with rising interest rates, marks a shift in the local real estate market. Moving forward, we anticipate a period of stabilization in home prices and continued, but moderated, growth in rent prices for this densely populated urban area.
