Real Estate Information Archive

We are finding a mixed bag of news for home sellers and buyers as we head into March 2010. The number of homes going under contract in Louisville Kentucky was up 23% in February 2010 compared to February 2009. That is great news for sellers but bad news for buyers looking for their first home. The increase in homes going under contract was primarily due to the $8000 first time homebuyer’s tax credit. Buyers looking to make their first investment are finding a buying war for quality homes in the 80-170,000 price range. Unlike many cities around the U.S., Louisville has generally maintained property values in the 1^st time buyers market and in many cases (depending on location) increased over the past few years.

Home sales should increase for Louisville’s more expensive homes as the owners of the first time homes start looking for their move up home. The $6500 move up tax credit for anyone who has owned a home for that past 5 years is still available. Both the first time homebuyers credit and the move up credit require that buyers be under contract by the end of April and close by the end of June.

Feb 2010

 Feb 2009

By the Numbers

New Home Sales numbers in the Louisville Kentucky area for December 2009 appear to have fallen. I say “appear”, because there are several reporting sources and updates may still come in. The numbers show that Home Sales for December 2009 were off 5.31% from a poor December 2008. To make matters worse, the December 2009 sales were actually better than they should have been. Remember that some of the closings in December were actually delayed from November 2009 because some mortgage companies (specifically their underwriters) dragged their feet approving home buyer’s loans and some appraisers slowed their pace to the speed of a snail.

The Big Picture

Up until December 2009, the picture looked rosy. Louisville Real Estate Sales started to climb steadily in June.  Thanks to the $8000 first time home buyer’s tax credit, a new home construction tax credit and low interest rates we could say with confidence that the home sales recovery was well underway in Louisville Kentucky.  As the deadline for the first time home buyers tax credit approached in November, home sales were actually brick. November Home Sales were actually up 57.16% (by one reporting services account) over November 2008.

What Happened

Even though our lawmakers extended the $8000 first time home buyers tax credit and added an additional $6500 tax credit for home owners (living in their current home 5 years) who wanted to move, sales in December fell flat. The urgency to buy and close before the original tax deadline was gone. The need to take advantage of the free money from Uncle Sam could be put on the back burner for the time being.

2010 looks ripe for a comeback

Our phones are ringing at the Medley Sokoler team office with requests to see properties; our websites are humming away with buyers looking for a good deal. Those are 2 good indicators that 2010 could end up being a recovery year for the real estate Industry in Louisville. Some new home builders we work with are starting new construction and interest rates are staying stable (at least as of this New Year’s Day writing) more good news for the housing industry. We also expect to see a lot more homes coming onto the market as sellers regain confidence in the market.

A word of caution to all would-be sellers

 Make sure your home has been staged properly and repairs have been made, make sure your realtor has done a through competitive market analysis (CMA) to determine an accurate price. Appraisers are watching prices closer than ever before; buyers are shopping longer and taking more time than ever to find the best home in the best condition with the best price. Only the most competitive homes will sell and only the correctly priced homes will pass the scrutiny of the appraiser.

Spurred on by the $8000 first time home buyers tax credit, Louisville home sales jumped by a whopping 40 Percent in November when compared to a November 2008! Many of the sales were in the $100,000 to $200,000 price range, the target of first time buyers.  Sellers of those homes moved up as homes in the $200,000 to $300,000 price point also did well.

Not All The News Is Good 

Homes going under contract slowed during the month of November as the original 1^st time home buyers tax credit deadline neared. Early in November the tax credit was extended to the end of April 2010 (to be under contract) and the end of June 2010 (to be closed). The extension took the pressure off buyers and the search for homes by first time  buyers slowed.  Officially the number of homes going under contract was up 11% in November over November of the year before.

Looking Forward To December 

Because of tighter mortgage requirements and slower appraisals of homes, sales in December should be better than expected. Those two factors delayed closings that were supposed to have occurred in November. The slowdown will help boost December 2009 numbers and give a false sense of recovery. Unless we see more buyers come into the market during December and January, Home sale figures for the beginning of 2010 could fall far short of hopes and expectations.

Other Tax Credits

The local and National media have done little to promote the brand new $6500 tax credit for home owners who have owned their home for 5 years or more and buy their next home. Additionally we’re seen little publicity surrounding the $5000 new construction tax credit in Kentucky. 

For more information head to www.weselllouisville.com.

November 2009

November 2008

Every day you hear the media talking about how easy it is to get a great deal when buying a home that was in Foreclosure. In Louisville Kentucky, there are an estimated 200 foreclosure sales every month. But what you don’t hear about in the media are the time delays associated with foreclosures. As part of our Live Video Blog series we talked with one of our clients just as they closed on a foreclosure home we found in Jefferson County.
Should you buy a Foreclosure? from Bob Sokoler on Vimeo.

Disturbing news for Louisville Home Sales!

New numbers just released by the Greater Louisville Association of Realtors show home sales taking a nose dive for March of 2008. When compared to March 2007, the number of homes that went under contract in the Louisville Kentucky area was off 27 % (see charts below). The number of homes that actually closed (typically went under contract in January or February of this year) was off 20%. The numbers are a sharp turnaround from February of this year when there was a 13% increase in the number of homes that went under contract.

Donna Miller Davis a Loan Office with Mortgage Network in Louisville Kentucky says “underwriters for lenders around the nation are requiring more documentation and better credit ratings from potential buyers”. Donna also says “even people with great credit are paying more for loans in fees and higher interest rates”.  

The average selling price for a home was down 9% from a year ago. The only bright spot in the numbers was the average days on the market for homes down from 88 in February of 2008 to 84 last Month. The number of homes on the market as of April 1, 2008 was 10,218 that’s about the average number (give or take a few hundred) that have been on the market over the winter.

Looking to sell your home this year. Here are some tips to help:

1)      Make any repairs needed.

2)      Freshen paint along baseboards and doors to remove scratches.

3)      De-clutter

4)      Stage all rooms

5)    Call or e-mail the Medley Sokoler team for an accurate CMA and other tips for selling you home in this market.

March 2008

March 2007

Interest in the Louisville Kentucky Home buying market for February 2008 is up from January 2008 by 13%, but a new problem is putting the brakes on buying a home, FINANCING!  New numbers just released by the Greater Louisville Association of Realtors show the number of homes that went under contract in February 2008 was 1165 compared to 1015 in January 2008. But, the number of homes that actually closed in February 2008 was down 13 % from the January 2008 under contract numbers. All indications are that mortgage companies are taking longer to finance or are refusing to finance loans.  So some homes that go under contract are taking longer to close or don’t close because of financing issues.

For months now, we’ve been watching mortgage companies tighten requirements to get a loan. Now we’re seeing hard proof that even lower interest rates won’t help buyers if the mortgage companies won’t grant those potential buyers home loans. The problem stems from several years of home loans being granted to people who did not have the credit history to support those loans. The mortgage industry was looking for the profit without considering the consequences. With so many home loans ending up in foreclosure and the government cracking down on mortgage companies who made those loans, home buyers in 2008 are paying the price for the past mistakes of the mortgage industry.  I actually saw an underwriter reject a loan because the potential buyer signed his name a little differently than the signature they had on record.  The closing attorney had the proper identification of the buyers but that wasn’t enough for the underwriters. The closing process was delayed because of it. We should point out that not all mortgage companies are responsible for the bad loans but all mortgage companies and buyers are now suffering from the crackdown by underwriters.

The number of homes going under contract in February 2008 compared to February 2007 is still down by 3%, but that’s a marked improvement from double digit negative numbers from months before.  As of today homes were averaging 88 days on the market and there are 9976 properties currently for sale in the greater Louisville area.

With the potential of another drop in interest rates coming in March 2008 and a positive feeling in the Louisville Kentucky housing market, Louisville may end up leading the country in a home sales recovery.  Now all we need are those mortgage companies to loosen lending guidelines so that people who are legitimately qualified to get a loan can by a home.