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Lebanon, Missouri: Rising Home Values and Stable Ownership in Route 66 Festival City
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
Lebanon, Missouri, is a vibrant city located in the heart of the Ozarks. Known for its natural beauty and outdoor recreational opportunities, Lebanon has experienced notable shifts in its housing market over the past decade. The city has maintained a relatively stable homeownership rate, while average home prices and average rent prices have shown significant fluctuations.
The homeownership rate in Lebanon has remained relatively steady, with slight variations over the years. In 2013, 62% of housing units were owner-occupied. This figure increased slightly to 63% in 2014 and 2015, before settling at 61% from 2017 to 2022. Despite these minor fluctuations, the overall trend suggests a stable homeownership market in Lebanon. Interestingly, this stability in homeownership rates occurred against a backdrop of rising average home prices. In 2013, the average home price in Lebanon was $106,564. This figure steadily increased over the years, reaching $192,284 by 2022, representing an impressive 80.4% increase over this period.
The relationship between federal interest rates and homeownership rates in Lebanon appears to follow the general trend observed nationally. From 2013 to 2015, when interest rates were extremely low (0.11% to 0.13%), Lebanon saw a slight increase in homeownership rates from 62% to 63%. As interest rates began to rise more significantly from 2016 onwards, reaching 1.68% by 2022, the homeownership rate in Lebanon stabilized at 61%. This aligns with the principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
Renter-occupied housing units in Lebanon have shown a slight upward trend over the years. In 2013, 37% of housing units were renter-occupied. This percentage increased to 39% in 2016 and remained relatively stable through 2022. The average rent prices in Lebanon have experienced some fluctuations during this period. In 2013, the average rent was $678 per month. It peaked at $738 in 2021 before settling at $692 in 2022. These changes in rent prices and renter percentages occurred as Lebanon's population grew from 21,125 in 2013 to 22,006 in 2022, suggesting a growing demand for rental properties in the city.
Looking at more recent data, the average home price in Lebanon continued its upward trajectory, reaching $202,621 in 2023 and $208,645 in 2024. This represents a 5.5% increase from 2022 to 2023 and a further 3% increase from 2023 to 2024. Concurrently, federal interest rates rose significantly to 5.02% in 2023 and 5.33% in 2024, potentially impacting homebuying decisions in the city.
Applying predictive models to forecast 5-year trends, it's anticipated that average home prices in Lebanon will continue to rise, albeit at a potentially slower rate due to higher interest rates. Average rent prices are also expected to increase moderately, driven by population growth and demand for rental properties. However, the rate of increase may be tempered by the city's efforts to maintain housing affordability.
In summary, Lebanon's housing market has demonstrated resilience and growth over the past decade. The city has maintained a stable homeownership rate despite rising home prices, while also seeing an increase in the proportion of renters. The relationship between interest rates, home prices, and ownership rates in Lebanon reflects broader economic trends. As the city continues to grow, balancing affordable housing options with rising property values will likely be a key focus for local policymakers and residents alike.
