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The Hollinden Team Louisville KY Real Estate Blog

Short Sales on the increase in Louisville KY

Short Sales are increasing and becoming easier to do. I went to school last year to learn how to do short sales. Since that time, the process is becoming more streamlined and familiar. Banks and consumers alike are moving to the short sale as an alternative to foreclosure. The banks don’t like the expense and risk that foreclosures entail. Homeowners don’t want a foreclosure on their records.
There are still 200 properties offered for sale every 2 weeks at the Jefferson County Commissioner’s office. An increasing percentage of properties are withdrawn before the sale. To be withdrawn, the homeowner needed to have worked out something with the bank. They may have worked out a loan modification, brought their status up to current, or have a contract to sell their house.
The Treasury Department has guidelines for short sales. The acronym is HAFA which stands for Home Affordable Foreclosure Alternative. The program, as can be expected is complex. Its purpose is to streamline use of short sales. It also provides for $1,500 to help with borrower relocation expenses. This does not take effect until April 5th, 2010.  However, many lenders are implementing this earlier.
What does this mean for the Louisville Market? Continued pressure as these homes will be sold to somebody for some price.

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Louisville Area Sales Trends

 I went to a seminar last week, on real estate trends in our area. I will try to give you a synopsis of what I learned about the Louisville real estate market. Some of the figures given also included counties surrounding Louisville as they are considered part of the Greater Louisville Area.

Depending on the area, the volume of sales was about the same for 2009 as they were for 2008. Looking closer, we find that the last half of 2009 was better than the first half. As we look at sales volume correlated to home sales price, we find that there was an increase in volume in 2009 for houses that cost $250k or less. Houses that cost $250+300k were essentially flat. Houses over 300k were lower than 2008. Houses over 400k were down even more.

Average Days on Market (DOM) were about the same for both years at 50 days. Houses valued at over $500k were on the market for an average of 130+ days.

The average home price in 2009 was about the same as it was in 2003 and 2004. The peak occurred in the last quarter of 2006 and first quarter of 2007. The average price for the second half of 2009 was better than the first half of 2009.
A long term trend is for the second quarter of a year to have higher sales prices than the first quarter.

FHA financing is on the increase.

What is affecting these trends? The tax incentives are making a difference. The first time home buyer is buying houses under $200k. We see a higher volume at this level and it drags the average price down. The general feeling about the economy is better and the volume of sales is increasing. The market for high end houses is thin. (that may be an understatement)

What happens when the tax incentives for first time and move up buyers expire in April? The jury is still out. We would say that the economy will drive the market from that point.

For more information, give your favorite real estate agent a call.

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Encouraging market

 The housing market in Louisville, Kentucky and surrounding area still looks encouraging.  The listings for the last week of January were 558 compared to 307 for the same period last year.  This was an increase of 251 properties or nearly 82%.  My hope is that this increase was due to the positive thoughts that people have about that economy and now is the time to sell.  I am sure that some of the numbers are foreclosures or short sales.  As we talk to people, the mood is definitely better than a year ago.

On the sales side, 170 properties closed from January 17-23, 2010 versus 128 a year ago.  This was an increase of 42 homes or 33%.  These are very positive numbers and reflect the trend that we saw in November and December.

We hope that these trends continue for the rest of 2010!

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