Doom and gloom are dominating much of the talk around the market coming into the year, and it can feel daunting to think about buying or selling a home in these conditions. However, that blanket pessimism isn’t the case when you look at the nuances of the Louisville market. Those planning a home transaction this year will experience a mix of pros and cons when starting a home search or listing their property. For a better understanding of what’s forecasted for 2023, here’s an overview of Louisville’s market today.
Louisville market
Those searching in Louisville today will find great homes, but in small numbers. With fewer than 1,500 single-family homes currently listed in the Greater Louisville area, competition will be up for buyers, and sellers will see increased interest.
While many buyers will still find the homes they want within their price range, the median sales price is on the rise due to low inventory, providing some additional obstacles for buyers. In Jefferson County, the median price rose 2%, while in the Greater Louisville area, median home prices rose 12.6%. Buyers looking in certain neighborhoods and for certain property types should expect higher prices and stiffer competition. Although inventory is not the lowest its been in the past few years, the monthly supply of inventory is far from balanced. Sellers in the area will benefit from rising prices and competition driven by insufficient supply.
While many buyers will still find the homes they want within their price range, the median sales price is on the rise due to low inventory, providing some additional obstacles for buyers. In Jefferson County, the median price rose 2%, while in the Greater Louisville area, median home prices rose 12.6%. Buyers looking in certain neighborhoods and for certain property types should expect higher prices and stiffer competition. Although inventory is not the lowest its been in the past few years, the monthly supply of inventory is far from balanced. Sellers in the area will benefit from rising prices and competition driven by insufficient supply.
2023 Forecast
Real estate in Louisville, KY will likely continue appreciating into the new year. Buyers in 2023 should keep this in mind when planning a purchase, while sellers will continue benefiting from higher prices. Even with increasing prices, it’s notable that the median price is only 0.3% higher than in the first half of 2021. Current conditions only barely outpace the past year’s frenzy.
Buyers in the area should also brace for continued low inventory, which the greater Louisville Association of Realtors predicts could last through the end of the year and for the next couple of years. This is because many homeowners aren’t willing to trade mortgages after locking in historically low rates. New construction will have to catch up with buyer demand to supplement supply, which takes longer. Sellers in the area will continue benefiting from low inventory, although they may find it difficult to find a new home once they close on a sale.
The housing market in Kentucky will continue growing into 2023, even with obstacles like low supply, high mortgage rates, and decreasing closed sales. As one of the fastest growing cities in the state, as well as one of the most populated cities in the US, there is plenty of demand for housing, and opportunity for rental properties. The job market in the area is also strong, with the GDP growing 37% in the past decade.
Buyers in the area should also brace for continued low inventory, which the greater Louisville Association of Realtors predicts could last through the end of the year and for the next couple of years. This is because many homeowners aren’t willing to trade mortgages after locking in historically low rates. New construction will have to catch up with buyer demand to supplement supply, which takes longer. Sellers in the area will continue benefiting from low inventory, although they may find it difficult to find a new home once they close on a sale.
The housing market in Kentucky will continue growing into 2023, even with obstacles like low supply, high mortgage rates, and decreasing closed sales. As one of the fastest growing cities in the state, as well as one of the most populated cities in the US, there is plenty of demand for housing, and opportunity for rental properties. The job market in the area is also strong, with the GDP growing 37% in the past decade.
2023 for buyers
Those searching for properties in Louisville have a few factors to consider entering the new year. Working toward buyers’ favor is the overall cooling market trends in the area. With inventory projected to continue increasing, and closed sales declining, buyers will continue having more and more opportunities to search for properties they love. Additionally, living in Louisville comes with a variety of perks. The cost of living is 4% below the national average, while housing is 18% below the national average.
Although housing may cost less overall, the median home price in Louisville, KY is projected to increase going into 2023. This, coupled with high interest rates, may make it difficult for buyers searching for a home. Those looking for a 30-year fixed loan can expect average rates of 7.21%, while 15-year fixed loans average 6.45%. When financing a mortgage, it’s more important than ever to research different loan types and local lenders for the best rates.
Although housing may cost less overall, the median home price in Louisville, KY is projected to increase going into 2023. This, coupled with high interest rates, may make it difficult for buyers searching for a home. Those looking for a 30-year fixed loan can expect average rates of 7.21%, while 15-year fixed loans average 6.45%. When financing a mortgage, it’s more important than ever to research different loan types and local lenders for the best rates.
2023 for sellers
Buyers are fighting against high rates and low inventory, but this puts sellers in an advantageous position. It would be beneficial to list as soon as possible to capitalize on the lack of competition in the market. However, be prepared for your next steps, as once sellers close on a deal, they may face many of the same obstacles buyers do when finding a new home.
Although the market is cooling somewhat, sellers will still benefit from favorable conditions for a time to come. The growing population, strong job market, and low supply all create competition for properties in the area, ensuring interest for a seller’s listing. Additionally, the high demand and low supply will continue to support increasing prices going into 2023. With other city perks like great amenities, summer events like the Shakespeare Festival and the State Fair, and nearby higher education, buyers will continue searching in Louisville.
Although the market is cooling somewhat, sellers will still benefit from favorable conditions for a time to come. The growing population, strong job market, and low supply all create competition for properties in the area, ensuring interest for a seller’s listing. Additionally, the high demand and low supply will continue to support increasing prices going into 2023. With other city perks like great amenities, summer events like the Shakespeare Festival and the State Fair, and nearby higher education, buyers will continue searching in Louisville.
Ready to enter the 2023 market?
Overall, the market in Louisville is a mix of pros and cons for buyers and sellers alike. Although buyers may find low inventory and high interest rates obstacles, the overall low cost of living and increasing supply will continue working to their advantage. Sellers should be mindful of a buyer’s power and their own position once they sell, while still taking advantage of high demand and increasing prices in the area. When you’re ready to start your home search or sale in Louisville, contact expert Louisville real estate agent, Laura Rice to guide you through the process.
