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Zip Code 35207: Average Home Values and Ownership Trends in Birmingham, Alabama
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 35207, located in Birmingham, Alabama, has experienced significant demographic and housing market changes over the past decade. This area has seen fluctuations in homeownership rates, average home prices, and average rent prices, reflecting broader economic trends and local market conditions.
The homeownership rate in zip code 35207 has remained relatively stable, hovering around 57-59% from 2013 to 2022. However, there has been a slight downward trend in ownership, dropping from 59% in 2013 to 57% in 2022. Concurrently, average home prices in the area have shown a substantial increase. In 2012, the average home price was $21,189, which rose steadily to reach $57,847 in 2022, representing a remarkable 173% increase over this period. This trend suggests that while home values have appreciated significantly, it hasn't translated into increased homeownership rates, possibly due to affordability issues for potential buyers.
Federal interest rates have played a crucial role in shaping homeownership trends. From 2012 to 2015, when interest rates were at historic lows (ranging from 0.09% to 0.14%), the homeownership rate in zip code 35207 remained stable at around 57-59%. As interest rates began to rise from 2016 onwards, reaching 1.68% in 2022, the homeownership rate showed a slight decline, settling at 57% by 2022. This trend aligns with the general principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
Renter percentages in zip code 35207 have shown a slight increase, moving from 40% in 2013 to 43% in 2022. This trend coincides with fluctuations in average rent prices. The average rent price was $693 in 2013, decreased to $620 in 2018, and then increased to $731 by 2022. This represents a 5.5% increase in average rent from 2013 to 2022, despite some fluctuations. The population in the zip code has decreased from 9,516 in 2013 to 7,966 in 2022, which may have influenced the rental market dynamics.
In 2023 and 2024, we see interesting developments in the housing market for zip code 35207. The average home price decreased from $57,847 in 2022 to $50,161 in 2023, a 13.3% drop. This downward trend continued into 2024, with the average home price further decreasing to $49,557. 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 home prices in the area.
Looking ahead, based on current trends and economic factors, we can predict that average home prices in zip code 35207 may stabilize or show modest growth over the next five years, assuming interest rates remain elevated. The average rent prices are likely to continue their gradual upward trend, potentially reaching around $800-$850 by 2029. However, these projections could be influenced by various factors including local economic conditions, population changes, and broader housing market trends.
In summary, zip code 35207 has experienced a significant increase in average home prices over the past decade, despite a slight decrease in homeownership rates. The rental market has seen moderate growth in both percentage of renters and average rent prices. Recent years have shown a cooling in the housing market, likely influenced by rising interest rates. These trends highlight the dynamic nature of the local real estate market and its sensitivity to broader economic factors.
