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The development of social capital is acknowledged as key for sustainable social development. Little is known about how social capital changes over time and how it correlates with sociodemographic and socioeconomic factors. This study was conducted in 46 neighbourhoods in Umeå Municipality, northern Sweden. The aim was to examine neighbourhood-level characteristics associated with changes in neighbourhood social capital and to discuss implications for local policies for sustainable social development. We designed an ecological study linking survey data to registry data in 2006 and 2020. Over 14 years, social capital increased in 9 and decreased in 15 neighbourhoods. Higher levels of social capital were associated with specific sociodemographic factors, but these differed in urban and rural areas. Urban neighbourhoods with a higher proportion of older pensioners (OR = 1.49, CI: 1.16–1.92), children under 12 (OR= 2.13, CI: 1.31–3.47), or a lower proportion of foreign-born members (OR= 0.32, CI: 0.19–0.55) had higher odds for higher social capital levels. In rural neighbourhoods, a higher proportion of single-parent households was associated with higher levels of social capital (OR = 1.44, 95% CI = 1.04–1.98). Neighbourhood socioeconomic factors such as income or educational level did not influence neighbourhood social capital. Using repeated measures of social capital, this study gives insights into how social capital changes over time in local areas and the factors influencing its development. Local policies to promote social capital for sustainable social development should strive to integrate diverse demographic groups within neighbourhoods and should increase opportunities for inter-ethnic interactions.