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Lebanon was ranked as the #4 emerging housing market in the Wall Street Journal/Realtor.com Emerging Housing Markets Index for the first quarter of 2023.
It’s Lebanon’s first time breaking the top 20. In the most recent rankings, for the fourth quarter of 2022, Lebanon was ranked #53.
The index compares the 300 most populous of the country’s 900+ core-based statistical areas. The index is split between real-estate market indicators and economic health indicators.
The real-estate market indicators include supply, demand, and price trends, which are all equally weighted. A market where homes are on the market for relatively few days would have a higher supply score. The demand score is based on the average number of online views for properties in the market. The price score is based on median listing price trend.
The economic health indicators are also equally weighted and include unemployment, wages, regional price parity, amenities, commute, foreign-born residents, small businesses, and property taxes. Lower unemployment and higher wages lead to better scores. Regional price parity is a measure of how affordable a market is to live in compared to national averages.
These three scores are based on official U.S. government data from the U.S. Bureau of Labor Statistics and the U.S. Bureau of Economic Analysis.
The number of Small Business Administration loans is used to proxy the small business score, while lower real estate taxes lead to a higher score for the property tax metric. The number of foreign-born residents, based on census data, is used due to the strong correlation that exists between economic vitality and foreign-born residents.
Lastly, the Wall Street Journal contributes its own data for the “amenities” score – based on the number of Starbucks, Whole Foods, and Trader Joe’s locations within the area, per capita.
So did the new Starbucks in Lebanon’s Target help with the jump? In all likelihood, yes. (A third Starbucks is currently under construction near the Lebanon Valley Mall in North Lebanon Township.)
Lebanon was the only Pennsylvania market to make the top 10, which also didn’t include any markets from neighboring states. Ohio, though, had two markets in the top 20 – Columbus at #12 and Springfield at #15, part of a particularly strong showing from the midwest in the rankings.
Lafayette, Indiana, was ranked #1 for the second consecutive quarter.
According to the Wall Street Journal’s analysis of the results, this quarter’s emerging markets are smaller than previous quarters, which the paper calls “a sign that buyer demand for affordable homes remains robust even as activity in the broader market slows.”
Eighteen of the top 20 markets in the ranking – including Lebanon – had median home-listing prices below the national median of $424,000. (According to the index, Lebanon’s median home-listing price in the first quarter was $372,000.)
|Rank||Metro||Population||Unemployment Rate (%)||Median Home Listing Price 2023|
|5||Fort Wayne, IN||423,038||2.7||$339,000|
|7||Sioux City, IA-NE-SD||149,265||2.6||$305,000|
|8||Omaha-Council Bluffs, NE-IA||971,637||2.4||$345,000|
Although the possibility of a recession is still hanging over the market, and buyers are paying 28% more to finance 80% of a home purchase compared to just one year ago, the WSJ/Realtor.com index results show that demand for affordable homes remains robust.
The Wall Street Journal and Realtor.com do not publish the underlying data for the index.
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