The local real estate market is active as the economy revs up, unemployment slides down and millennials reach home-buying age.
Seven or eight years out of the “great” recession, the Louisville housing market has again become a vibrant pool of activity. Sale prices are rising. People with homes to sell are celebrating the professional evaluation of a “seller’s market” and people looking to buy homes are finding the loosening of mortgage regulations.
You can tell this by strolling around your own neighborhoods and seeing the front lawns dotted with tulips, crocuses and “For Sale” signs. Or you could listen to the real estate professionals and look over their shoulders at all their positive market reports.
We’ve tapped into a few of these pros for their good news. And Tim Moore, senior vice president of marketology at Semonin Realty, has shared a slew of encouraging facts and figures from the Greater Louisville Association of Realtors.
Moore attributes the uptick of local activity to three market indicators and a sociological observation.
“An agent once told me that the market always hinges on three things: the level of inventory, interest rates and the economy,” said Moore. “If one of those changes, it affects the entire market.”
Well, inventory is still low and interest rates are starting to inch up – “close to as high as they’ve been in the last five years,” Moore notes. But the local economy is strong and unemployment is down.
More to the point, Moore feels, millennials are entering the market – those born, beginning in the 1980s, who threaten to become the largest land mass of a generation in history, larger even than the baby boomers.
“The older millennials are in the 25-35-year age range,” Moore said. “That’s the time for home ownership. They’re earning money and have job stability. They also have that quiet confidence that maybe it’s okay to commit to buying a home.”
So, if you own a home or are considering putting yours on the market, you’ll find this a fun spring read.
Inventory Ins and Outs
The story of our city’s current real estate market is pure Economics 101: Supply is down; prices are up.
Average list price $346,000
One year ago: $328,000
Active listings in the Greater Louisville area: 2,863
a month earlier: 2,806
three months ago: 3,348
six months ago: 3,814
this time last year: 3,187
Months of inventory 2.5 months
Four weeks ago : 3 months
One year ago: 2.5 months
Months of Inventory – MOI – is the amount of time it would take to sell all current listings at the current sales pace. “It’s an industry measuring stick,” Moore explained. “Like a blood pressure reading for the industry.”
Buying and Renovating
“Building permits are up year-to-date 18 percent, even in the bad weather conditions we have faced this winter, mostly wet, rainy conditions. Permit numbers will only grow stronger as the summer months approach. There is definitely a pent-up backlog for new starts, which are primarily pre-sold homes. That fact doesn’t necessarily help our spec inventory needs, but it also is not adding too much product on the market.”
– Pat Durham, executive vice president, Building Industry Association of Greater Louisville
“Offers for move-in ready starter homes continues to be the norm, and 55 percent of homes are selling in 30 days or less. Our members are working diligently with prospective sellers to get their homes ready for the spring and summer markets.”
– Dave Parks, president, The Greater Louisville Association of Realtors
“The real headline is the super-hot sellers’ market for starter homes in all areas, but St. Matthews, Crescent Hill and the Highlands continue to be in demand. Renovated homes in Germantown are popular, and that trend is extending to Shelby Park.”
– John Fischbach, realtor, ReMax, board member and past president, Louisville Multiple Listing Services
There’s a rental housing resurgence in Louisville. And it’s driven by baby boomers, many of whom became empty nesters when housing was in a slump. It’s spawned a new breed of rental properties designed to meet the needs, lifestyles and their spending habits of the maturing boomers.
The Villas at Forest Springs, near the Ford Truck Plant in the Pewee Valley-Crestwood area, has a boomer-targeted approach – called “a continuing-care retirement community” – that involves more than providing a rental unit. The Villas at Forest Springs has an entire aging-in-place approach that takes the boomers when they’re a self-sufficient at 55 and offers them options all the way through their sunset years into their 80s and beyond.
Entry-level is one of the 34 patio homes in what the developers call The Villas: 1,165-square-foot, one-story, two-bedroom, two-bath units with walk-in showers, covered patio, attached garage, laundry space and enough green space to satisfy most green thumbs.
The $2,860-a-month rent includes utilities, housekeeping, maintenance and landscaping.
The Villas is a non-medical community, but as residents age or their health needs change, they can transition into a studio bedroom on the health campus, where they get assisted-living services, meals and skilled nursing and rehab facilities.
The property was developed by Trilogy Health Services, which has four other similar campuses in the Louisville area and a sixth under construction. The new one, at Hurstbourne Lane and Stony Brook, will be available by the end of 2018.
The property’s lifestyle director, Allison Garrett, says there are two other similar developments in the area: Forum at Brookside in Middletown, owned by Five-Star Senior Living; and Traditions at Beaumont in Fern Creek, run by Traditions Management. The others, says Garrett, are buy-ins, not rentals.
Villas at Forest Springs is at 4120 Wooded Acre Lane, Louisville, 40245; 502-243-1643. (The nearby Villas of Forest Springs is an unrelated, traditional rental property.)
Seller’s Or Buyer’s Market?
It depends on the price range. But, in general, if you’re a Louisville homeowner with an open house on Sunday, plan on loading up with lots of chocolate chip cookies.
Up to $100,000 494 active listings 203 sold in prior 30 days
$100,000-$250,000 888 active listings 682 sold in prior 30 days
$250,000-$500,000 1,024 active listings 234 sold in prior 30 days
$500,000 and above 459 active listings 41 sold in prior 30 days
total: 2,865 active listings 1,160 sold
Admit it. You’re curious. Here’s the average price (and average increase or decrease versus a year ago) of homes by county.
Jefferson County $201,000 up 4.1%
Oldham County $344,000 up 3.8%
Shelby County $211,000 down 3.8%
Floyd County (Indiana) $178,000 down 1.3%
Bullitt County $187,000 up 18.8%
Clark County (Indiana) $196,000 up 22.6%