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Zip Code 40902: Rural Kentucky's Homeownership Resilience Amid Rising Home Values
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 40902, located in Arjay, Kentucky, has experienced significant demographic and housing market changes over the past decade. This rural area has seen fluctuations in homeownership rates and housing prices, reflecting broader economic trends and local market conditions.
The homeownership rate in zip code 40902 has shown a general upward trend from 2013 to 2022, with some fluctuations. In 2013, the homeownership rate was 70%, which increased to a peak of 78% in 2017 and 2018. By 2022, it slightly decreased to 70%. This trend generally correlates with changes in average home prices. From 2018 to 2022, average home prices in the area increased steadily from $50,040 to $62,025, representing a 24% increase over four years.
Federal interest rates have played a role in homeownership trends in zip code 40902. The period from 2013 to 2016 saw historically low interest rates, ranging from 0.09% to 0.40%. During this time, homeownership rates increased from 70% to 72%. As interest rates began to rise more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates initially peaked at 78% before starting to decline. This suggests that while low interest rates initially encouraged homeownership, other factors, such as rising home prices, may have offset this effect in later years.
Renter percentages in zip code 40902 have generally decreased from 2013 to 2022, inversely mirroring the homeownership trend. The renter percentage dropped from 30% in 2013 to a low of 22% in 2017 and 2018, before increasing slightly to 30% in 2022. Average rent prices have shown a significant upward trend, particularly in recent years. In 2013, the average rent was $276, which remained stable until 2017 when it began to increase. By 2022, the average rent had risen to $478, representing a 73% increase from 2013. This substantial rise in rent prices occurred despite a declining population, which decreased from 1,196 in 2013 to 829 in 2022.
In 2023 and 2024, we observe some changes in the housing market for zip code 40902. The average home price in 2023 was $60,198, showing a slight decrease from 2022. In 2024, the average home price further decreased to $56,321. This downward trend coincides with a significant increase in federal interest rates, which rose to 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, our predictive models forecast continued volatility in the housing market for zip code 40902 over the next five years. Average home prices are expected to stabilize and potentially see modest growth, reaching approximately $65,000 by 2029. Rent prices are projected to continue their upward trajectory, albeit at a slower pace, potentially reaching an average of $550 per month by 2029.
In summary, zip code 40902 has experienced notable shifts in its housing market dynamics. The area has seen an overall increase in homeownership rates and significant growth in both home prices and rent prices from 2013 to 2022. However, recent data from 2023 and 2024 indicates a potential cooling in the housing market, likely influenced by rising interest rates. The interplay between homeownership rates, housing prices, and economic factors will continue to shape the real estate landscape in this Kentucky community in the coming years.
