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Zip Code 93420: Arroyo Grande's Rising Home Values and Stable Ownership Rates
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 93420, located in Arroyo Grande, California, has experienced significant changes in homeownership rates, average home prices, and average rent prices over the past decade. This area, known for its pleasant Mediterranean climate and proximity to the Pacific coast, has seen a generally stable homeownership rate with fluctuations in housing and rental markets.
The homeownership rate in zip code 93420 has remained relatively steady, with slight variations between 67% and 72% from 2013 to 2022. Despite these minor fluctuations, the average home prices have shown a consistent upward trend. In 2013, the average home price was $506,672, which increased to $946,991 by 2022, representing an impressive 86.9% growth over this period. This substantial rise in average home prices, coupled with a relatively stable homeownership rate, suggests that existing homeowners have benefited from significant property value appreciation while new buyers faced increasingly challenging market conditions.
The relationship between federal interest rates and homeownership rates in this area is noteworthy. From 2013 to 2015, when interest rates were extremely low (0.11% to 0.13%), the homeownership rate actually decreased slightly from 70% to 67%. However, as interest rates began to rise more significantly from 2016 onwards, the homeownership rate stabilized around 70%. This trend suggests that other local factors, such as the robust increase in home prices, may have had a more significant impact on homeownership rates than interest rates alone in this particular market.
Renter percentages in zip code 93420 have remained relatively stable, ranging from 28% to 33% between 2013 and 2022. During this period, average rent prices showed an overall upward trend, albeit with some fluctuations. In 2013, the average rent was $1,601, which increased to $1,826 by 2022, representing a 14% increase. It's worth noting that the population grew from 30,631 in 2013 to 32,596 in 2022, a 6.4% increase. This population growth, combined with the rising average rent prices, indicates a steady demand for rental properties in the area.
Looking at more recent data, the average home price in zip code 93420 continued its upward trajectory, reaching $969,542 in 2023 and further increasing to $1,016,868 in 2024. This represents a 7.4% increase from 2022 to 2024. Simultaneously, federal interest rates have risen significantly, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates, combined with the continued increase in home prices, may pose challenges for potential new homebuyers in the area.
Applying predictive models to forecast 5-year trends, we anticipate that average home prices in zip code 93420 will continue to rise, potentially reaching around $1,250,000 by 2029. This projection is based on the historical growth rate and assumes continued demand in the area. For average rent prices, we expect a more moderate increase, potentially reaching approximately $2,100 by 2029, reflecting the area's steady population growth and consistent demand for rental properties.
In summary, zip code 93420 has demonstrated a robust and appreciating housing market over the past decade, with significant increases in average home prices despite relatively stable homeownership rates. The rental market has also shown steady growth, albeit at a more moderate pace. The area's desirability, coupled with population growth, suggests continued upward pressure on both home prices and rents in the coming years, potentially presenting challenges for affordability but opportunities for existing property owners.
