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Zip Code 55328: Rising Home Values and Shifting Ownership Trends in Delano, Minnesota
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 55328, located in Delano, Minnesota, has experienced significant growth and changes in its housing market over the past decade. This area has seen a steady increase in population, rising from 8,529 in 2010 to 10,188 in 2022, indicating a growing demand for housing in the region.
The homeownership rate in zip code 55328 has shown a slight downward trend over the years. In 2013, the area boasted a high homeownership rate of 88%, which gradually decreased to 82% by 2022. This decline coincides with a substantial increase in average home prices, which rose from $193,341 in 2010 to $431,423 in 2022, representing a remarkable 123% increase over 12 years.
Federal interest rates have played a significant role in shaping homeownership trends in the area. The period from 2010 to 2016 saw historically low interest rates, ranging from 0.1% to 0.4%. During this time, homeownership rates remained relatively stable, hovering around 86-88%. However, as interest rates began to rise from 2017 onwards, reaching 1.68% in 2022, homeownership rates declined slightly to 82%. This trend aligns with the general principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
The renter population in zip code 55328 has grown steadily, with the percentage of renters increasing from 10% in 2013 to 18% in 2022. This shift coincides with fluctuations in average rent prices. The average rent rose from $920 in 2013 to a peak of $1,336 in 2017, before experiencing some volatility in subsequent years. By 2022, the average rent stood at $896, which is slightly lower than the 2013 figure. The increase in the renter population, despite the fluctuating rent prices, suggests a growing demand for rental properties in the area, possibly driven by the rising home prices that may be pricing some potential buyers out of the market.
Looking at the most recent data, the average home price in zip code 55328 slightly decreased from $431,423 in 2022 to $426,992 in 2023, marking a small dip of about 1%. However, in 2024, the average home price rebounded to $431,739, surpassing the 2022 level. This recovery occurs despite the significant increase in federal interest rates, which rose to 5.02% in 2023 and further to 5.33% in 2024. These higher interest rates typically make mortgages more expensive, yet the housing market in this zip code appears to remain resilient.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in zip code 55328 will continue to rise, albeit at a more moderate pace compared to the rapid growth seen in the early 2020s. The average home price is projected to reach approximately $475,000 by 2029. For rent prices, the forecast suggests a gradual increase, with average rents potentially reaching around $1,600 per month in the next five years.
In summary, zip code 55328 has demonstrated a dynamic housing market characterized by strong population growth, rising home values, and an increasing renter population. The slight decline in homeownership rates, coupled with the substantial increase in home prices, indicates a shifting landscape where more residents are turning to renting. Despite recent interest rate hikes, the housing market remains strong, with home prices showing resilience. The area is poised for continued growth in both home values and rental rates, making it an interesting market to watch in the coming years.
