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Rising Home Values and Ownership: Lebanon, NH's Vibrant Housing Market
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, located in New Hampshire, is a vibrant community that has experienced significant growth and changes in its housing market over the past decade. With a population of 14,515 as of 2022 and covering an area of 41.27 square miles, Lebanon offers a blend of urban amenities and rural charm. The city has seen fluctuations in homeownership rates and notable increases in both average home prices and average rent prices.
The homeownership rate in Lebanon has shown a gradual increase over the years, rising from 48% in 2016 to 52% in 2022. This upward trend in homeownership coincides with a substantial rise in average home prices. In 2010, the average home price in Lebanon was $208,645, which steadily increased to $376,727 by 2022, representing an impressive 80.6% growth over 12 years. The most significant jump occurred between 2020 and 2022, with average home prices surging from $273,218 to $376,727, a 37.9% increase in just two years.
Federal interest rates have played a crucial role in shaping homeownership trends in Lebanon. The period from 2010 to 2021 saw historically low interest rates, ranging from 0.08% to 0.18%, which likely contributed to the increased homeownership rates. As interest rates remained low, more residents could afford mortgages, driving up demand for homes and subsequently, home prices. The sharp increase in home prices from 2020 to 2022 coincided with interest rates rising from 0.38% in 2020 to 1.68% in 2022, suggesting that buyers may have been rushing to purchase homes before rates climbed higher.
Renter percentages in Lebanon have fluctuated inversely to homeownership rates, decreasing from 51% in 2016 to 48% in 2022. Despite this slight decrease in the renter population, average rent prices have shown an overall upward trend. In 2013, the earliest year with available data, the average rent was $1,196. After some fluctuations, it reached $1,131 in 2022, representing a modest 5.4% decrease over nine years. However, it's worth noting that rent prices peaked at $1,235 in 2021 before slightly declining in 2022.
The years 2023 and 2024 have brought significant changes to Lebanon's housing market. Average home prices continued their upward trajectory, reaching $406,329 in 2023 and further increasing to $428,724 in 2024. This represents a 13.8% increase from 2022 to 2024. Simultaneously, federal interest rates have risen dramatically, hitting 5.02% in 2023 and 5.33% in 2024. These higher interest rates may impact future homeownership trends and potentially slow the rate of home price appreciation.
Looking ahead to the next five years, based on current trends and economic indicators, we can expect average home prices in Lebanon to continue rising, albeit at a potentially slower pace due to higher interest rates. A conservative estimate suggests average home prices could reach around $500,000 by 2029. Average rent prices are likely to follow suit, potentially increasing to approximately $1,300-$1,400 per month over the same period, assuming continued population growth and demand for rental properties.
In summary, Lebanon has experienced a notable increase in homeownership rates and substantial growth in average home prices over the past decade. The interplay between low interest rates and rising home values has been a significant factor in shaping the local housing market. While renter percentages have slightly decreased, rent prices have remained relatively stable with some fluctuations. The recent sharp increase in interest rates, coupled with continued home price appreciation, suggests a potentially changing landscape for Lebanon's housing market in the coming years.
