It’s been another outstanding year for home sales in our city. Prices are moving higher as well! Therefore, it must be time for my Louisville real estate 2017 year in review!
Each year, going back almost a decade, I’ve written a year-in-review piece covering Louisville real estate. It really helps to look back and see how the past 12 months performed. I evaluate all aspects of residential (sorry, no commercial) real estate: home sales to sale prices to interest rates, and more!
I’ve published this story a number of times at InsiderLouisville but this year we’re putting it right here—in the #1 real estate blog in Louisville. So, without any further ado… let’s get started!
Another Record Is on the Horizon
2016 was a record year for home sales in Louisville, Kentucky. Don’t believe me? Check out last year’s year-end summary.
Throughout most of 2017, sales were neck-and-neck with the sales pace of the previous year. January was ahead then February fell flat. March was an incredible month! Then April came. You get the picture.
So where are we now? Humans learn best through pictures so I’ve updated the January through November Louisville home sales chart going back to 2002.
Wow… check that out! Even with an absorption rate below 2.5 months of inventory for the entire year, Louisville may actually beat its all-time sales record in 2017. Amazing.
Obviously, the demand is there. Just think what these numbers could have looked like with more homes available to purchase.
Here’s how the different price tiers performed. Rather than raw units as I did before, I’ve used percentages and made it into a handy, dandy pie chart.
61.3% of all home sales in 2017 were under $200,000. This is down just slightly from 2016. As you might expect, the higher price tiers see fewer homes sold. Also, these homes typically take longer to sell.
Here are some other thoughts I like to include in my Louisville real estate 2017 year in review:
- The median home sales price in 2017 was $168,000. Last year was $161,000.
- The average home sales price in 2017 was $205,983. Last year was $198,194.
- Our absorption rate is down to a paltry 2.31 months. (6 months is considered a balanced market.) Last year it was 2.82, which honestly, isn’t much better.
- The year-to-date cumulative days on market is 50. Last year was 64.
Overall, our results are very similar to last year but with an even lower inventory. 2017 saw more homes sell faster and for more money.
Price Changes in Different Parts of Louisville
Here at Louisville Homes Blog, we update our housing reports regularly. Half the MLS areas get updated each month. The others are updated each quarter. You can find them above under the tab labeled “Housing Reports.”
Having this data current helps me produce these larger articles. See this chart? I simply grabbed the 12-month trailing average data point for November 2017 and compare it with the one 12 months earlier.
Some of these areas are quite large (MLS Area 7) while others are tiny (MSL Area 0) so some of these values are more reliable indicators of an area’s appreciation. It’s a great look at which areas are most in-demand either by higher sales prices or higher valued new construction.
Adding up the values for these areas we find a whopping 8.1% gain year-over-year! Considering that Louisville typically has a 4% annual appreciation, this is outstanding! Of course, this is true only benefiting homeowners while renters forgo the opportunity to build equity in lieu of greater flexibility.
Here’s the data I used to build the chart above.
|1 – Old Louisville||19.4%||$45,272||$54,046|
|30 – Shelby Co.||12.5%||$177,300||$199,468|
|21 – South Oldham Co.||12.4%||$249,685||$280,617|
|2 – Highlands||11.3%||$177,763||$197,788|
|19 – Spencer Co.||10.9%||$200,046||$221,852|
|20 – North Oldham Co.||10.4%||$277,961||$306,802|
|3 – St. Matthews||8.2%||$237,031||$256,429|
|4 – Pleasure Ridge Park||7.7%||$105,983||$114,121|
|6 – Okolona||6.9%||$134,493||$143,746|
|5 – Fairdale||5.9%||$113,523||$120,270|
|9 – Prospect||5.6%||$248,602||$262,438|
|11- Bullitt Co.||5.3%||$160,421||$168,951|
|8 – Middletown||4.6%||$268,592||$281,044|
|7 – Jefferstown||3.6%||$173,617||$179,865|
|0 – Downtown||2.5%||$166,304||$170,396|
|1 year trailing average of medians|
Louisville Real Estate 2017 Year in Review Conclusion
It’s almost a carbon copy of last year’s report, simply with better numbers! There’s still the chance that December falls flat on its face but all indications are that when it’s all said and done, 2017 is the new, all-time best year for Louisville home sales.
This is while inventory levels are at historical lows. It’s crazy really.
Historically low-interest rates and our improving economy have played a strong role in this year’s production. Other ancillary factors have as well. But it’s clear that demand is there, despite far fewer choices for our house hunters.
One last thought: Assuming inventory rebounds in 2018, which is greatly needed but not necessarily expected, we could be in for three straight, record-breaking sale years. Let us hope homeowners get off the sidelines and are primed to make a move in the new year.