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Zip Code 35209: Rising Home Values and Ownership in Homewood, 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 35209, located in Homewood, Alabama, has experienced significant changes in homeownership rates and property values over the past decade. This area, known for its suburban charm and proximity to Birmingham, has seen a notable shift in the balance between owners and renters, alongside substantial fluctuations in average home and rent prices.
The homeownership rate in zip code 35209 has shown a steady increase from 2013 to 2022. In 2013, the area had a homeownership rate of 41%, which gradually rose to 53% by 2022. This 12 percentage point increase coincided with a significant rise in average home prices. In 2013, the average home price was $243,165, and by 2022, it had climbed to $474,687, representing a 95% increase over this period. The trend suggests a strong correlation between rising home values and increased homeownership rates, possibly indicating growing confidence in the local real estate market and improved economic conditions for residents.
Federal interest rates have played a crucial role in shaping homeownership trends in zip code 35209. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.11% to 0.4%. During this time, homeownership rates increased from 41% to 43%, likely due to more affordable financing options. As interest rates began to rise more significantly from 2017 (1%) to 2019 (2.16%), homeownership continued to grow, reaching 49% by 2019. This trend suggests that other factors, such as local economic growth and housing market dynamics, may have outweighed the impact of rising interest rates on homeownership decisions in this area.
The rental market in zip code 35209 has experienced its own set of changes. In 2013, 58% of residents were renters, paying an average rent of $1,131. By 2022, the percentage of renters had decreased to 47%, while the average rent had increased to $1,259, a 11.3% rise over nine years. This trend indicates that while fewer residents are choosing to rent, those who do are facing higher rental costs. The population growth from 28,635 in 2013 to 29,954 in 2022 may have contributed to the upward pressure on rent prices despite the declining percentage of renters.
Looking at the most recent data, the average home price in zip code 35209 reached $491,026 in 2023 and further increased to $491,966 in 2024, showing a continued upward trend in property values. Simultaneously, interest rates have risen significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates may impact future homeownership trends, potentially slowing the rate of increase seen in previous years.
Applying predictive models to forecast future trends, we anticipate that average home prices in zip code 35209 will continue to rise over the next five years, albeit at a potentially slower rate due to higher interest rates. The average home price could reach approximately $550,000 by 2029. Average rent prices are also expected to increase, potentially reaching around $1,500 by 2029, reflecting ongoing demand for rental properties in the area despite the trend towards increased homeownership.
In summary, zip code 35209 has experienced a significant shift towards homeownership from 2013 to 2022, with a 12 percentage point increase in owner-occupied homes. This trend has been accompanied by a substantial 95% increase in average home prices over the same period. The rental market has seen a decrease in the percentage of renters but an increase in average rent prices. Recent data shows continued growth in property values, with potential moderation due to rising interest rates. These trends reflect a dynamic and evolving real estate market in this Alabama suburb, with implications for both current and future residents.
