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Zip Code 72227 in Little Rock: Rising Home Values and Stable Ownership Amid Market Fluctuations
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 72227, located in Little Rock, Arkansas, has experienced significant changes in homeownership rates and property values over the past decade. This area has seen a general trend of increasing homeownership and rising average home prices, while maintaining relatively stable average rent prices.
The ownership percentage in zip code 72227 has shown an overall upward trend from 2013 to 2022. In 2013, the homeownership rate was 59%, which increased to 66% by 2018, representing a substantial 7 percentage point increase in just five years. However, there was a slight decline to 61% by 2022. This trend generally aligns with the movement in average home prices. The average home price in 2013 was $183,506, which steadily increased to $253,792 by 2022, representing a 38.3% increase over this period. The most significant jump occurred between 2020 and 2022, with average home prices rising from $207,046 to $253,792, a 22.6% increase in just two years.
Federal interest rates have played a role in homeownership trends in zip code 72227. From 2013 to 2016, interest rates remained below 0.5%, coinciding with the period of increasing homeownership rates. As interest rates began to rise in 2017, reaching 2.16% by 2019, the homeownership rate stabilized around 63-64%. The sharp drop in interest rates to 0.08% in 2021 may have contributed to maintaining the homeownership rate at 61% in 2022, despite rising home prices.
Renter percentages in zip code 72227 have generally decreased as homeownership rates increased. In 2013, 41% of the population were renters, which decreased to 34% by 2018. However, there was a slight increase to 39% by 2022. Average rent prices have shown an overall upward trend, rising from $943 in 2013 to $1,084 in 2022, an increase of 14.9%. Notably, there was a significant spike in average rent to $1,244 in 2021, before decreasing to $1,084 in 2022. This temporary increase in rent prices coincided with a period of low interest rates and rising home prices, which may have put pressure on the rental market.
In 2023 and 2024, average home prices in zip code 72227 continued to rise, reaching $259,317 in 2023 and $261,919 in 2024. This represents a modest 2.2% and 1% increase respectively from the previous year. Interestingly, federal interest rates also increased significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024. Despite these higher interest rates, home prices continued to appreciate, albeit at a slower pace than in previous years.
Looking ahead, based on the historical trends and current market conditions, we can forecast the following 5-year trends for zip code 72227:
1. Average home prices are likely to continue their upward trajectory, but at a more moderate pace. We can expect prices to reach approximately $280,000 to $290,000 by 2029.
2. Average rent prices may stabilize or increase slightly, potentially reaching $1,200 to $1,300 per month by 2029, assuming no major economic disruptions.
In summary, zip code 72227 has demonstrated resilience in its housing market, with increasing homeownership rates and steadily rising average home prices over the past decade. The area has weathered fluctuations in federal interest rates and maintained a balance between ownership and rental markets. The recent slowdown in price appreciation, coupled with higher interest rates, suggests a potential stabilization of the market in the coming years.
