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Zip Code 35802: A Decade of Rising Home Values and Shifting Ownership Patterns in Huntsville, 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 35802, located in Huntsville, Alabama, covers an area of 17.62 square miles. This suburban area has experienced significant changes in homeownership rates, average home prices, and average rent prices over the past decade.
The homeownership rate in zip code 35802 has seen a steady decline from 2013 to 2022. In 2013, 65% of residents owned their homes, but by 2022, this figure had dropped to 55%. Conversely, the percentage of renters increased from 35% to 45% during the same period. This shift coincides with a substantial rise in average home prices. In 2013, the average home price was $204,893, which more than doubled to $347,166 by 2022, representing a 69.4% increase over nine years.
The trend in homeownership rates appears to be inversely related to federal interest rates. For instance, when interest rates were at historic lows between 2013 and 2016 (ranging from 0.11% to 0.40%), homeownership rates remained relatively stable at around 63-65%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, homeownership rates declined more rapidly, falling from 61% in 2017 to 55% in 2022.
Renter percentages have shown a consistent upward trend, rising from 35% in 2013 to 45% in 2022. This increase in renters has been accompanied by fluctuations in average rent prices. The average rent rose from $1,004 in 2013 to a peak of $1,098 in 2015, before declining to $919 in 2016. It then gradually increased again, reaching $986 by 2022. The population of the zip code has also grown during this period, from 20,323 in 2013 to 22,465 in 2022, which may have contributed to the increased demand for rental properties.
In 2023 and 2024, the average home prices in zip code 35802 continued to rise, albeit at a slower pace. The average home price reached $348,969 in 2023 and $350,875 in 2024, showing a modest increase of 0.54% from 2022 to 2023 and 0.55% from 2023 to 2024. This slowdown in price growth coincides with a significant increase in federal interest rates, which rose to 5.02% in 2023 and 5.33% in 2024.
Looking ahead, based on the observed trends and current market conditions, we can expect the following 5-year predictions: Average home prices are likely to continue increasing, but at a more moderate pace. We may see prices reach around $375,000 to $400,000 by 2029. Average rent prices are expected to follow an upward trend, potentially reaching $1,100 to $1,200 per month by 2029.
In summary, zip code 35802 has experienced a significant shift from homeownership to renting over the past decade, driven by rapidly increasing home prices and fluctuating interest rates. The area has seen substantial population growth and property value appreciation, indicating a dynamic and changing real estate market. As interest rates remain high, we may continue to see a preference for renting in the short term, but long-term homeownership trends will depend on factors such as economic conditions, local job market strength, and housing supply.
