By Bob Sokoler
(www.bobsokoler.com)
The bubble may have burst in the East, West and South putting home sales into a tailspin, but here in Louisville the housing market is in much better shape. To many experts in the Real Estate industry higher interest rates and higher gas prices are partially responsible for the national bursting of the bubble. The downward spiral accelerated as the news media, hungry for headlines, went into a feeding frenzy when word came that housing starts and mortgage applications had slowed.
The media stories scared buyers, the same media stories scared investors and home owners who had reaped the rewards of record double digit home appreciation. Lets face it on paper many of the investors had become rich. In Florida for example what was a 100,000 dollar condo in 2004 was now worth 400,000 dollars in 2006. I personally know a guy who went to Miami and bought several condos in a building that was in pre-construction and sold those condos 6 months later (and a year before the building opened) for massive profits.
So it stands to reason that anyone owning property in the bubble was frightened by the media reports. Home owners and investors tried selling their property but the media had done its job. Word was out that the bubble had burst, property continues to sit on the market at bloated prices. Take Phoenix Arizona as an example, California investors had targeted the city as the next hot spot. The bubble inflated until the first signs of the costal burst. This summer some 45 thousand homes sat on the market dumped by investors trying to salvage what they could of their paper profits.
Because of the national reports Louisville home sales slowed. (Visit the Louisville market at www.weselllouisville.com) Many local home owners didn’t understand that Louisville’s steady 3% appreciation paled when compared to the costal double digit appreciation. The fact they we were never in a bubble has helped us start to recover from a national home sales slowdown.
Home sales in the Louisville market topped 1541, that’s 39 more homes sold than last month. But the Medley-Sokoler team believes that because of the fallout from national publicity about the bubble bursting and slightly higher interest rates (when compared to a year ago), home sales fell short of the last years 1604 for the Month of August.
The number of homes going under contract last month hit 1483 when compared to July’s 1450 homes.
Without question it's a buyers market. Without question it's a buyers market and deals can be found. There are almost 10 thousand homes on the market right now, 3 thousand more than last year at the same time.
