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Zip Code 36904: Rising Homeownership and Fluctuating Home Values in Butler, 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 36904, located in Butler, Alabama, showcases an interesting dynamic in its housing market over the past decade. This rural area, spanning 226.78 square miles, has experienced fluctuations in homeownership rates and average rent prices, reflecting the changing economic landscape of the region.
The homeownership rate in zip code 36904 has shown a general upward trend from 2013 to 2022. In 2013, 73% of residents were homeowners, which increased to 78% by 2022. This rise in homeownership coincided with changes in average home prices, although specific data for earlier years is not available. By 2022, the average home price in the area was $126,085.
Federal interest rates play a significant role in homeownership trends. From 2013 to 2020, interest rates remained relatively low, ranging from 0.11% to 2.16%. This period of low interest rates likely contributed to the increase in homeownership, as mortgages became more affordable for potential buyers. The homeownership rate peaked at 79% in 2021 when interest rates were at a mere 0.08%.
Renter percentages in zip code 36904 have fluctuated inversely to homeownership rates. In 2013, 27% of residents were renters, which increased to a peak of 34% in 2016 before declining to 22% in 2022. Average rent prices have shown considerable volatility during this period. In 2013, the average rent was $538, which rose to $725 in 2018, the highest point in the available data. By 2022, the average rent had decreased to $580. These fluctuations in rent prices and renter percentages may be influenced by changes in the local economy and housing availability.
In 2023 and 2024, we observe a slight decline in average home prices in zip code 36904. The average home price decreased from $126,085 in 2022 to $123,191 in 2023, and further to $122,357 in 2024. This trend occurs alongside a significant increase in federal interest rates, which rose from 1.68% in 2022 to 5.02% in 2023 and 5.33% in 2024. The higher interest rates may be contributing to the softening of home prices in the area.
Looking ahead, predictive models suggest that average home prices in zip code 36904 may continue to experience a slight downward trend over the next five years if current economic conditions persist. However, given the area's relatively low housing costs compared to national averages, this decline is likely to be moderate. Average rent prices are projected to remain relatively stable, potentially fluctuating within a narrow range around the current level of $580, assuming no major economic shifts in the region.
In conclusion, zip code 36904 has demonstrated resilience in its housing market, with a strong trend towards homeownership despite fluctuations in average rent prices. The recent increase in federal interest rates appears to be exerting downward pressure on home prices, which may impact future homeownership rates. The area's relatively affordable housing market is likely to continue attracting residents, potentially supporting stability in both home prices and rent levels in the coming years.
