Louisville’s housing market has elements of both a buyers’ and sellers’ market. The average home sells below its list price. However, multiple offers for some properties suggest a competitive market that favors sellers. In addition to healthcare, manufacturing, and logistics, the city has a wide range of other industries.
In recent years, the city’s economic growth has been steady. This has had a positive effect on the housing market. In November, home prices in Louisville increased by 5.4% compared to last year. This upward trend is contrary to any signs of a decline in home prices and an imminent market crash.
Current Louisville Housing Market Trends
What is the state of the housing market? Redfin reports that Louisville’s housing market is a competitive one, with an average of three offers on homes and a sale within 26 days. In November 2023, the median price for Louisville homes increased by 5.4% over the previous year. The number of homes that were sold in November was slightly lower than the 690 homes sold during the same time period last year.
Key Stats and Insights
- Median Sales Price: Louisville’s median sales price is 42 percent lower than the average national sale price, which highlights the city’s affordability compared to the wider real estate market.
- Multiple offers: Certain homes in Louisville are subject to multiple offers. This indicates a competitive market.
- Average Home Sell Price: On average, homes are sold for about 2% less than the list price. The pending period is approximately 28 days.
- Hot Home: Properties that are considered “hot” may sell at or near the list price and can enter a pending state in as little time as seven days.
Market Trends & Changes
Sale to List Price: This ratio is 98.0%. It shows a slight decline of 0.24 points from year to year, which indicates a possible shift in negotiation between buyers and vendors.
Homes Sold above List Price: 22,2% of homes sold above list price. This represents a decline of 3.2 percentage points from the previous year, indicating a possible stabilization of the market.
Homes With Price Drops: A decrease of 2.2 percentage points over the past year could indicate a more balanced housing market.
Buyer behavior and preferences
From October 23rd to December 23, 24% of Louisville’s homebuyers indicated an interest in leaving the city, whereas 76% wanted to remain within the metro area. These data provide insight into the preferences and mobility of the local population.
The decision to purchase a home in Louisville is based on your personal circumstances and preferences. The market is a buyer’s or seller’s market, so prospective buyers need to carefully weigh their options and consider whether they are financially prepared and what their long-term goals are.
Louisville Real Estate Market Outlook for 2024
Data from Zillow shows that the average home price in Louisville is $229,601, a significant increase of 4.4% compared to the previous year. Louisville homes are quickly put on pending status, with an average of 10 days. This highlights the rapid pace of real estate deals.
The inventory of properties for sale as of November 30th, 2023, included 2,007, and 850 were added during that time. As of October 31st, 2023, the median ratio between sales and listings is 1.000. This indicates a fair negotiation between buyers and sellers.
As of November 30th, 2023, the median price for a sale is $234,167. The median price for a list is 254,950. Note that 32.6% are above the list prices, while 46.3% are below, showing a varied market.
Louisville MSA Housing Market Forecast
The housing market forecast of the Louisville Metropolitan Statistical Area provides insight for 2023-2024. The MSA is a geographical entity that encompasses various counties in the state of Kentucky.
Based on the data for December 31st, 202023, February 29,2024, and November 30th, 2024, it is predicted that there will be a small increase of 0.1% at the end of 2023. This will then be followed by a modest decrease of -0.3% by February 2024. Then, by November 2024, we expect a significant decline of -1.3%.
This forecast is intended to indicate potential market adjustments, but not necessarily a downturn of the Louisville MSA Housing Market. The Louisville Metropolitan Statistical Area is a collection of counties in Kentucky that serve as an economic region.
These countries influence factors like home values, market trends, and inventory in the context of the real estate market. The MSA is significant because it provides a comprehensive view of the housing market around Louisville and reflects the interconnectedness between different regions in the state.
Will the Louisville Housing Market Crash?
According to the data and forecasts available, there are no signs of an imminent housing crash in Louisville, Kentucky. The forecast indicates that there may be adjustments in the future, but the current trends, such as rising home values and an even sale-to-list ratio, are not indicative of a housing market nearing a crash. Prospective buyers and vendors should keep an eye on the changing landscape and make decisions that are based on individual circumstances.
Louisville Real Estate Investment Overview
Do you want to purchase a rental property in Louisville, KY, so that your bank account can be credited with some extra cash? Louisville is making waves in the real estate world. This is one of America’s best markets for investors who want to rent out their properties. If you’re considering buying an investment property in the Louisville market, here are some observations and tips.
Louisville Real Estate is affordable.
Louisville’s real estate market is a good place to invest, but the affordability of it depends on a number of factors and your personal financial situation. The market is still relatively affordable despite rising home values. Investors will find properties in a range of price points, and there is a good chance that they will appreciate them over time. The affordability of a Louisville investment depends on the market, your investment goals, and your budget at the time.
In 2022, the current population of Louisville’s metro area is 1,107,000. This represents an increase of 0.82% from 2021. In 2021, the metro area population in Louisville was 1,098,000. This is an increase of 0.83% from 2020. In 2020, the metro area population in Louisville was 1,089,000. This is a 0.74% rise from 2019. Kentucky’s unemployment rate is 3.90% compared to 4.00% in the previous month and 4.70% in the past year. This is below the long-term median of 6.66%.
Louisville has a twenty-year, nearly one billion dollar plan to develop west Louisville. A third of the money will go to the Russell neighborhood. Investors in the Louisville market will know where housing, infrastructure, and amenities are going to be built. Investors can purchase properties to flip or rent later.
The Middle Market is Lacking Supply, Driving Prices Up
Louisville’s real estate market offers a wide range of affordable properties. Some luxury properties are on the market. The middle of the market is where demand is highest, and supply is least. First-time buyers, as well as empty nesters, look for properties between $100,000 and $300,000. Despite the shortage of properties, there are often bidding wars for those in this price range. You can make a lot of money if you buy properties at affordable prices and renovate or expand them.
The rental market is large.
It is not surprising that the city has multiple universities, as it is the largest in the state. Around 5,000 scholars live at the University of Louisville. Jefferson Community and Technical College has around 3000 students. Sullivan University has another 1500 students. There are many private universities, such as Bellarmine University and Boyce College.
Louisville Campus, Louisville Bible College, and Spalding University. These schools offer a variety of markets for investors to choose from in the Louisville real estate market. Fort Knox, one of the biggest military installations in the United States, is located in Louisville, Kentucky. Around 12,000 jobs have been created in the Louisville metro area. Louisville has its own MEPS base as well as an army reserve training center and a U.S. Navy installation.
In Louisville, KY, the average rental is $1,110 as of September 2023. This represents a 1% rise compared to last year. The average monthly rent in Louisville for a studio apartment increased by 19% to $950. The average rent of a one-bedroom apartment rose by 7% to $1110. And the average rent of a two-bedroom apartment grew by 4% to $1249.
Landlord Friendly
Property owners can profit in two different ways from their properties. The first is to sell the property at a profit. Rent is another way to make money. In states that favor tenants over landlords, it is difficult to get the rental income that you expect. You also risk losing money in these states if you have non-paying tenants that cost thousands to evict. Kentucky, on the other hand, is a landlord-friendly state.
Kentucky permits landlords to issue a quit notice unconditionally if the tenant is late with rent at least once within the last six months. Rent that has not been paid can lead to a tenant being evicted quickly. State laws require that the tenant must remedy the situation within seven days, or a quit notice will be issued. In these cases, the landlord may refuse to accept past-due payments and “cure” the problem.
Kentucky’s laws are unique in that they allow landlords to keep deposits for up to 60 days. Other states do not address security deposit returns. A move-out list detailing damages and charges to the security deposit must be provided. Rent can only be deducted for minor repairs if the landlord does not fix the problem within two weeks. Rent cannot be refused because someone fixed some small things.
Rent increase notices and grace periods are not covered by any statutes. If a tenant is evicted, landlords can claim court and attorney fees. If the tenant is allowed to live in the apartment as part of his or her job and then quits that job, he or she can be evicted.
Louisville Encourages AirBnB in Areas Where It Benefits Tourism
Louisville’s real estate market may not be as accommodating as other places. Still, it is willing to make concessions in order to accommodate AirBnB or other short-term rental services where they can benefit both the local property owners and tourism. They plan to allow short-term rentals in commercial and industrial neighborhoods such as Butchertown.
The city has allowed some developers to dedicate condos exclusively to short-term rentals downtown due to the demand for them. All short-term rentals are required to be registered in the city, or you will have to pay fines. The number of people who can stay at a property is limited, and the property owner must pay a “bed tax” that’s close to 10%.