The low inventory in Kentucky’s housing market, along with slowly rising mortgage interest rates, is finally influencing the sales boom we have experienced since May of 2020. February closings topped out at 3,484, up just below 2% from February of 2020 (3,424).
Kentucky metro area house prices are forecasted to outperform the national market over the next twelve months. Currently, the market is tracking the overall U.S. market. Compared to 12-months ago, Kentucky’s housing market has strengthened. Current local economic conditions support an estimated 5.6% increase in house prices over the next twelve months. Based on the housing market vitality of the nine metro housing markets which comprise it, Kentucky’s housing market ranks twentieth amongst all states and D.C. The three-month outlook is neutral.
Fewer than two in five Kentucky REALTORS®expect house price appreciation to exceed that of the last twelve months, according to the March 2021 edition of the HousingIQ Survey of Kentucky REALTORS®. Fewer than one-half of the 337 REALTORS® from across Kentucky, expect their sales volume to increase over the next twelve months. "The low inventory, low mortgage rate-fueled price growth is running into an affordability wall”, explained Vidur Dhanda, author of the survey. “First-time buyers are getting priced out as their income growth cannot keep up with double-digit home price increases, even with the benefit of historically low mortgage rates.”
- 47% of respondents expect an increase in sales volume
- 37% expect increased sales to first-time buyers
- 45% expect increased sales to investors
- 48% anticipate increased interest from single-family rental investors
- 58% of respondents expect more houses to sell above the asking price
- 44% anticipate greater foot traffic
- 42% expect houses to sell faster