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Zip Code 56132: Rural Minnesota's Rising Home Values and Ownership Trends
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
The Lakes, located in zip code 56132 in Minnesota, has experienced notable shifts in homeownership rates and housing prices over the past decade. This small community has maintained a consistently high rate of homeownership, with fluctuations in average home and rent prices. The ownership percentage in The Lakes has shown a slight upward trend in recent years, increasing from 85% in 2017 to 91% in 2022. This rise in homeownership coincides with changes in average home prices. In 2016, the average home price was $201,276, which decreased slightly to $198,611 in 2019. However, from 2020 onwards, there was a significant increase in average home prices, rising from $208,200 in 2020 to $261,753 in 2022, representing a 25.7% increase over this period.
Federal interest rates have played a role in homeownership trends. The period from 2016 to 2022 saw interest rates fluctuate, starting at 0.4% in 2016, peaking at 2.16% in 2019, then dropping to 0.08% in 2021 before rising to 1.68% in 2022. The low interest rates in 2020 and 2021 likely contributed to the increase in homeownership rates, as they made mortgages more affordable for potential buyers.
Renter percentages in The Lakes have generally decreased, moving from 15% in 2017 to 9% in 2022. Despite this decline in the renter population, average rent prices have shown an overall upward trend. In 2013, the average rent was $676, which increased to $905 by 2017. After reaching this peak, rent prices experienced some fluctuations, settling at $871 in 2022. This represents a 28.8% increase in average rent from 2013 to 2022, despite the decreasing proportion of renters.
Looking at the most recent data, the average home price in The Lakes continued to rise, reaching $268,943 in 2023 and $283,018 in 2024. This represents a substantial increase of 8.1% from 2022 to 2024. Concurrently, federal interest rates have also increased significantly, rising to 5.02% in 2023 and 5.33% in 2024. These higher interest rates may impact future homeownership trends and housing affordability in the area.
Applying predictive models to forecast 5-year trends, we can anticipate continued growth in average home prices, albeit at a potentially slower rate due to higher interest rates. Average home prices could reach around $320,000 to $340,000 by 2029. For rent prices, the trend suggests a moderate increase, potentially reaching an average of $950 to $1,000 per month by 2029, assuming economic conditions remain stable.
In summary, The Lakes has seen a strengthening in homeownership rates, coupled with significant increases in both average home prices and rent prices. The community has maintained a high proportion of owner-occupied housing, even as property values have risen substantially. The interplay between federal interest rates, homeownership rates, and housing prices will likely continue to shape the local real estate market in the coming years.
