Brett's Real Estate News & MLS Deals 4/20/2020
Updated: Apr 29
Note: MLS links in this post expire in 30 days!
How Bad Is It?
Here's what's going on in the Louisville’s real estate market.
Going into March the market was strong. The median March home price in Louisville was up 9.2% over last years prices, sales volume was steady, and liquidity was as good as I’ve ever seen it and I’ve been around for a while.
Just a few short weeks later and our market is reshaping. Pending Sales Volume is down 21% year over year, prices are down 1% and trending lower to 3.5% down.
It was a super fast market. The median days-on-market for March was only 11 days for Pending Sales. The properties that closed in March had a median days-on-market of 23 days. So the market accelerated from 23 days-on-market down to 11 days in just a few weeks. Once the lockdown was in place the time it took to get a contract on a property rose to nearly 50 days.
-Reading the graph: the vertical axis is "days-on-market" (DOM) which represents market liquidity. The shorter the days-on-market the faster properties are selling. For sellers, the lower the better. In 2009 the median DOM was nearly 100 days. By 2016 it had fallen below 25 days.
This is the most dramatic market change in such a short time period in many decades. It far surpasses the speed the market declined starting in 2008 with the mortgage crisis. A solid jolt.
I won't pretend to know how this will play out but here are some guesses. The moratorium on foreclosures will save a lot of people but not everyone. REO inventory should rise by late summer or early fall as some property owners voluntarily give the keys to their lender. It will start slow with the handing-in of the keys and it will pick up during the winter as the first wave of foreclosures pushes through the courts. So REO inventory should rise.
It's possible the mortgage markets could freeze. Already some banks have announced they are pulling back from mortgage lending. Underwriting guidelines will surely tighten. Imagine what happens to the market if buyers are required to make 20% down payments. I've also read that some lenders are imposing liquidity requirements just to refinance. The potential for another blood bath ala the 2008 mortgage debacle is real. Refinance now if you've been thinking about it and stay well.
17517 Pope Dale Rd. 40245- 2,328 sq.ft. house on 5 acres, in-ground pool, listed for $369,900, ARV up to $490,000
New Weekly Listings 4/15 to 4/21/20 2019 2018 2017
1 Week Single Family Listings 325 515 561 559
1 Week Multi-Family Listings 1 16 5 9
1 Week Rental Listings 21 23 28 14
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