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Zip Code 90404: Santa Monica's Beach-Adjacent Urban Area Sees Home Values Double Amid Stable Renter Majority
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 90404, located in Santa Monica, California, is a coastal area known for its beautiful beaches and thriving tech scene. This analysis focuses on the changes in homeownership rates, average home prices, and average rent prices over the past decade. The data reveals that while ownership percentages have remained relatively stable, average home and rent prices have shown substantial increases.
In 2013, the homeownership rate in zip code 90404 was 21%, with an average home price of $599,521. By 2022, the ownership rate remained steady at 21%, but the average home price had nearly doubled to $1,164,955. This significant increase in average home prices, despite a consistent ownership rate, indicates strong demand for properties in this desirable area. The most dramatic rise occurred between 2017 and 2018, when average home prices jumped from $832,309 to $973,594, a 17% increase in just one year.
Federal interest rates have influenced homeownership trends in the area. In 2013, when interest rates were at a low 0.11%, the ownership rate was 21%. As interest rates gradually increased to 1.83% in 2018, there was a slight uptick in homeownership to 23%. However, by 2022, despite interest rates rising to 1.68%, the ownership rate returned to 21%, suggesting that factors beyond interest rates affect homeownership in this zip code.
Renter percentages have mirrored the homeownership trends, with 79% of residents renting in both 2013 and 2022. Average rent prices have shown a steady increase over this period. In 2013, the average rent was $1,466, rising to $1,846 by 2022, a 26% increase. The population growth from 21,570 in 2013 to 24,465 in 2022 likely contributed to the rising rental costs due to increased demand for housing in the area.
Recent data shows that the average home price in zip code 90404 decreased slightly from $1,164,955 in 2022 to $1,116,383 in 2023, a 4.2% drop. However, in 2024, prices have begun to recover, reaching $1,132,034. This slight rebound occurs despite the significant increase in federal interest rates, which rose from 1.68% in 2022 to 5.02% in 2023 and further to 5.33% in 2024.
Predictive models forecast continued growth in both average home and rent prices for zip code 90404 over the next five years. Average home prices are projected to surpass $1.3 million by 2029, while average rent prices could reach approximately $2,200 per month. These projections are based on historical trends and assume continued demand for housing in Santa Monica.
In conclusion, zip code 90404 has demonstrated remarkable resilience in its real estate market. Despite stable homeownership rates, average home prices have nearly doubled over the past decade. Rental prices have also shown consistent growth, reflecting the area's desirability and increasing population. The recent slight dip in home prices followed by a recovery suggests a robust market capable of weathering short-term fluctuations. As Santa Monica continues to attract residents with its coastal lifestyle and proximity to tech hubs, the upward trend in both home values and rental prices is expected to persist in the coming years.
