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Zip Code 35242: Rising Home Values and Ownership Rates in Hoover, 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 35242, located in Hoover, Alabama, has experienced significant changes in homeownership rates, average home prices, and average rent prices over the past decade. This area has shown a consistent trend towards increased homeownership and rising property values, making it an interesting case study for real estate market dynamics.
The homeownership rate in zip code 35242 has shown a steady increase from 65% in 2013 to 72% in 2022. This upward trend in homeownership coincides with a substantial rise in average home prices. In 2013, the average home price was $314,906, which increased to $508,983 by 2022, representing a remarkable 61.6% growth over nine years. This strong positive correlation between homeownership rates and average home prices suggests that despite rising costs, more residents in this area are choosing to buy homes rather than rent.
Federal interest rates have played a significant role in shaping homeownership trends in zip code 35242. From 2013 to 2016, when interest rates were extremely low (ranging from 0.11% to 0.4%), the homeownership rate increased from 65% to 66%. As interest rates began to rise more sharply from 2017 to 2019 (1% to 2.16%), homeownership continued to climb, reaching 68% by 2019. This trend suggests that other factors, such as local economic conditions or housing market dynamics, may have outweighed the impact of rising interest rates on homeownership decisions in this area.
While homeownership has been on the rise, the percentage of renters in zip code 35242 has decreased from 31% in 2013 to 28% in 2022. Despite this decline in the renter population, average rent prices have shown a consistent upward trend. The average rent increased from $1,191 in 2013 to $1,344 in 2022, a 12.8% increase over nine years. This rise in rent prices, coupled with a decreasing renter population, suggests a tightening rental market with potentially higher-quality or more desirable rental properties becoming available.
In 2023 and 2024, the real estate market in zip code 35242 continued to evolve. The average home price reached $522,738 in 2023 and further increased to $536,388 in 2024, showing a continued upward trajectory. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting homebuying decisions and mortgage affordability for residents in the area.
Looking ahead, predictive models suggest that the upward trend in both average home prices and rent prices is likely to continue over the next five years. Average home prices are projected to increase by approximately 3-5% annually, potentially reaching around $620,000 by 2029. Average rent prices are expected to rise at a similar rate, potentially reaching $1,550 per month by 2029. These projections assume continued economic growth and stable local market conditions.
In summary, zip code 35242 has demonstrated a strong trend towards increased homeownership, with rising average home prices and rent prices. The area has shown resilience in its housing market, with homeownership rates continuing to climb even in the face of rising interest rates. The combination of increasing property values and a growing preference for homeownership suggests a robust and desirable real estate market in this Hoover zip code.
