Home LoansMortgage

Best Cities for Homeownership in Pennsylvania

Owning a home is both a major financial milestone and an immense privilege. And in order to understand the value of that privilege, you have to know the full context of your investment. That means learning certain things about your community, such as local job prospects, educational opportunities and commute times. It also means understanding how an area’s economy might be affecting the value of homes in that area and the overall cost of living.

In Pennsylvania, home values in many parts of the state appreciated more than 10% between 2013 and 2017, according to the LendingTree study described below. The Keystone State is also home to two of the top 10 school districts in the U.S. and nearly 250 postsecondary and higher education institutions, according to the Pennsylvania Department of Community and Economic Development.

Still, which cities offer the best investment potential? To find out, LendingTree dug into U.S. Census Bureau data collected in both 2013 and 2017 for 34 Pennsylvania cities that are either part of a metropolitan statistical area or a micropolitan statistical area of 10,000 to 50,000 residents. The data was collected as part of the Census Bureau’s annual American Community Survey, which looks at qualities homebuyers often value, such as local home value appreciation, cost of housing increases, unemployment rates and average commute times.

Here’s what we found:

Key findings:

  • The State College metro area is the best place in Pennsylvania for homeownership. It has a high median home value ($225,200), low unemployment (4.6%) and solid home value appreciation from 2013-2017 (10.61%).
  • The Lewisburg micro area is the second-best place for homeownership. It has a high median home value of $183,200, the lowest unemployment on the list (3.4%) and the second-highest home value appreciation from 2013-2017 (15.8%).
  • The Johnstown metro area is the worst place for homeownership in Pennsylvania. It has a low median home value ($102,900), high unemployment (7.5%) and increasing housing costs from 2013-2017 (3.01%).

The best cities for homeownership in Pennsylvania

1. State College metro area

This central Pennsylvania metro area, home to Penn State University, outranked every other area in Pennsylvania, with a top score of 73.8. From 2013 to 2017, the median value of a home grew 10.61% to reach $225,200. The unemployment rate then (4.6%) was relatively average compared to other cities on this list, but commuters got to work quicker, in just 20.4 minutes. One potential downside: Housing costs in State College grew 5.62% between 2013 and 2017.

2. Lewisburg micro area

Lewisburg, also in central Pennsylvania, may have come in second in our city rankings, but it outperformed State College in two key ways. For example, between 2013 and 2017, home values appreciated 15.8%, about five percentage points higher than in State College. Lewisburg also had the lowest unemployment rate of any top 10 city in Pennsylvania, 3.4% in 2017. However, the median home value then was just $183,200, and the cost of housing grew about 7% from 2013 to 2017. Its overall homeowner score is 70.3.

3. Bloomsburg-Berwick metro area

Located east of Lewisburg, the Bloomsburg-Berwick metro area came in just shy of that city with a homeowner score of 70. From 2013 to 2017, housing costs here grew only about half a percent, significantly lower than in both Lewisburg and State College. Still, by 2017 home values had appreciated only about half as much as in Lewisburg (7.28%), the unemployment rate was almost 5%, and homes had a median value of $160,700.

4. Sayre micro area

Sayre, located along the New York-Pennsylvania border, had the best home value appreciation of any city we surveyed, growing 16.89% from 2013 to 2017. During that time, the cost of housing increased only 2.37%. Still, in 2017 the median value of a home here was just $153,600. However, with a lower bar to entry, new homebuyers may be attracted to Sayre, which could drive up home values further.

5. Harrisburg-Carlisle metro area

The Harrisburg-Carlisle metro area, located a few hours west of Philadelphia, tied with Williamsport (below) with a homeowner score of 64.7. Home values grew modestly here compared to other top 10 cities (4.16%) but outpaced an almost negligible rise in housing costs.

The average commute time was comparable to second-ranked Lewisburg, as was the median home value of $182,700. But the unemployment rate was higher, nearly 5%.

6. Williamsport metro area

Set in north-central Pennsylvania, this metro area saw its median home value grow nearly 12% from 2013 to 2017, which puts it near the top two cities on our list. The average commute time (20.2 minutes) was slightly shorter than for top-ranked State College. However, Williamsport had the highest unemployment rate (6.2%) of any top 10 city, and in 2017 the median housing value was just $155,600. With a final score of 64.7, it tied with Harrisburg-Carlisle.

7. Warren micro area

Warren sits along the northern edge of the Allegheny National Forest, near the New York state border. Residents here saw home values grow a median of 7.93% between 2013 and 2017; at the same time, the cost of housing decreased nearly 1%. In 2017, the median home value of $100,700 was the lowest for any city on our top 10 list. So if you haven’t bought a home yet, Warren might offer a good entry point to the market. Another point to consider: The area had a 5.7% unemployment rate in 2017, which was the second highest for a top 10. Its final homeowner score was 61.5.

8. Lancaster metro area

Located west of Philadelphia, Lancaster earned a final score of 60.3. In 2017, the median home value was close to $200,000, and the unemployment rate (4.7%) was middling. Still, Lancaster lagged the top-five cities on our list as measured by home appreciation. From 2013 to 2017, homes here appreciated a median of just 2.65%, while the cost of housing grew 1.68%.

9. Selinsgrove micro area

Selinsgrove is located just south of second-ranked Lewisburg, but its final homeowner score put it slightly below eighth-ranked Lancaster. In 2017, it had the second-lowest unemployment rate of any top 10 city (3.6%), and homes grew in value more than 10% from 2013 to 2017. Unfortunately, the cost of housing during that time grew 5.86%. Still, in 2017 the median home value was just $159,200.

10. Gettysburg metro area

Gettysburg, the site of the famous Civil War battle, is a metro area located in southern Pennsylvania near Maryland. In 2017, it had a median home value of more than $200,000. But at 27.6 minutes, the average commute time was the longest for any top 10 city. Another caveat: Home values here fell by 0.63% from 2013 to 2017. Still, housing costs decreased 1.11% during the same time frame.

Homebuying tips for Pennsylvania

If you’re considering moving to Pennsylvania, you may have solid options where your investment has the potential to grow. Still, home appreciation hasn’t been consistent throughout the state lately. Ten of the 34 areas we looked at had an increase in home value of more than 10% between 2013 and 2017, but eight saw either negligible growth (less than 2%) or a decrease.

Statewide, the Pennsylvania housing market doesn’t always resemble other parts of the country. For example, while all-cash offers now account for almost a quarter of home offers nationwide, there may be less reason to worry about them in Pennsylvania. A recent survey by the Pennsylvania Association of Realtors found that the number of Pennsylvania homebuyers using a 30-year mortgage to finance their purchase (a historically common option among homeowners) has increased lately, growing from 38 percent to 50 percent during the last half of 2018.

For anyone looking to get a mortgage, the standard recommendation is to put down 20%; although, in reality, down payments now are often far less. According to ATTOM Data Solutions, an Irvine, Calif.-based company that collects national property data, the median down payment in Pennsylvania during the first quarter of 2018 was just $8,000, or about 4.6% of the median home sale price of $174,000.

If you’re looking to buy a home with an affordable mortgage and possibly also a low down payment, you may be able to get help from national programs, such as those offered by the FHA and VA, as well as programs from the Pennsylvania Housing Finance Agency. Still, it’s important to consider the full weight of your investment to avoid overborrowing. If you already own a home, a high home value is a positive, but it’s something a buyer — especially a first-timer — needs to scrutinize.

In its recent survey, the Pennsylvania Association of Realtors found that only 43% of respondents said it took less than three months to find their home, down from nearly 50% in 2018. This means prospective homebuyers may need to work quickly once they find a home that’s right for them, and that usually means a pre-approved mortgage is key.

Like some states, Pennsylvania state law requires a seller to provide you with a property disclosure statement that details all known material defects, even if they’re not readily visible. However, it’s still important to get an inspection done on any property. Consider making your offer contingent on a good inspection report.

Methodology:

The methodology for this study was simple and straightforward.

1: Collect metropolitan statistical areas (“MSAs”) and micropolitan statistical areas from the U.S. Census Bureau using 2017 population data.
2: Each MSA and micropolitan statistical area was ranked on a scale from 34 (Best) to 1 (Worst) for five different metrics. Those metrics are:

  • Median Home Value (34-Highest Value, 1-Lowest Value)
  • Unemployment Rate (34-Lowest Rate, 1-Highest Rate)
  • Average Commute Time (34-Shortest Time, 1-Longest Time)
  • Median Home Value Appreciation (2013-2017) (34-Greatest Appreciation, 1-Smallest Appreciation)

Median Change in Yearly Housing Costs (2013-2017) (34-Smallest Cost Change, 1-Greatest Positive Cost Change) — The formula for this metric is:

(((Monthly Housing Costs for 2017 *12)+(Real Estate Tax for 2017))/ ((Monthly Housing Costs for 2013 *12)+(Real Estate Tax for 2013))-1)
3: An average score was then calculated for each MSA based upon the scores received for each metric.
4: The MSAs and micropolitan statistical areas were then ranked on a scale of 1 (Best) to 34 (Worst) based on their average scores.
5: All metrics were ranked equally.

Data:

All data were obtained from the U.S. Census Bureau. More information on where the data came from is provided below:

2017 Median Home Value, Monthly Housing Costs, Real Estate Taxes

  • Filtered for all MSAs
  • Then filter for Financial Characteristics for housing units with a mortgage – 2013-2017 American Community Survey 5-Year Estimates

2017 Unemployment Rate and Median Commute Time

  • Filtered for all MSAs
  • Then filter for Selected Economic Characteristics – 2013-2017 American Community Survey 5-Year Estimates

2013 Median Home Value, Monthly Housing Costs, Real Estate Taxes

  • Filtered for all MSAs
  • Then filter for Financial Characteristics for housing units with a mortgage – 2013-2017 American Community Survey 5-Year Estimates
 

Today's Mortgage Rates

  • 2.869%
  • 2.53%
  • 3.033%
Calculate Payment
Advertising Disclosures Terms & Conditions apply. NMLS#1136