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Zip Code 27601: Downtown Raleigh's Shifting Home Values and Ownership Trends
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Zip code 27601, representing downtown Raleigh, North Carolina's capital city, has undergone significant changes in homeownership rates and property values over the past decade. From 2013 to 2022, the percentage of owner-occupied homes decreased from 33% to 27%, while average home prices more than doubled during the same period.
The relationship between homeownership rates and average home prices in zip code 27601 shows an inverse correlation. As average home prices increased from $192,805 in 2013 to $522,649 in 2022, the percentage of owner-occupied homes declined from 33% to 27%. This trend suggests that rising property values may have made homeownership less accessible for many residents in the area.
Federal interest rates have played a role in homeownership trends in zip code 27601. During periods of low interest rates, such as from 2013 to 2016 when rates ranged from 0.11% to 0.40%, homeownership rates remained relatively stable at around 32-33%. However, as interest rates began to rise in 2017 and reached 1.83% by 2018, homeownership rates dropped to 28%, indicating that higher borrowing costs may have deterred potential buyers.
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The renter population in zip code 27601 has grown steadily, with the percentage of renter-occupied homes increasing from 67% in 2013 to 73% in 2022. This shift coincides with a significant rise in average rent prices, which increased from $539 in 2013 to $1,310 in 2022. The population growth from 9,390 in 2013 to 10,493 in 2022 likely contributed to the increased demand for rental properties and subsequent rise in rent prices.
In 2023 and 2024, average home prices in zip code 27601 continued to rise, albeit at a slower pace. The average home price reached $526,389 in 2023 and $533,420 in 2024. Interestingly, federal interest rates also increased significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024, which may have impacted home buying decisions and property values.
Looking ahead, predictive models suggest that average home prices in zip code 27601 may continue to rise over the next five years, potentially reaching around $600,000 by 2029. Average rent prices are also expected to increase, potentially surpassing $1,500 per month within the same timeframe. These projections are based on historical trends and current market conditions.
In summary, zip code 27601 has experienced a significant shift towards a renter-dominated market over the past decade, with rising property values and rent prices potentially contributing to this trend. The inverse relationship between homeownership rates and average home prices, coupled with fluctuations in federal interest rates, has shaped the local real estate landscape. As the area continues to grow and evolve, it is likely to see further increases in both home values and rental costs in the coming years.
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