Home sales slip in February, prices remain strong
YTD still on pace to break records
For the first time since the summer of 2015, Kentucky real estate saw a decrease in monthly, year over year, home sales. The 2.2 percent decline in February (3,191 in 2017 versus 3,263 in 2016) comes at a time when housing inventories are at historical lows. The median price, however, remained strong, increasing over 5 percent to $114,298.
“Last year, the market was really hot and properties moved quick. A single month’s drop in sales isn’t indicative of a slow-down,” said Mike Becker, president of Kentucky REALTORS®. “In fact, it’s still a seller’s market and the hope is that to meet buyer demand, new construction will ramp up this year to supplement existing home listings.”
Year to date, homes sales are up 7.8 percent and March figures are looking strong. At the current pace, 2017 is shaping up to be another record-setting year for Kentucky. Nationally, pending home sales are at the second-highest level in over a decade, showing that demand is rising and buyers are gearing up for the busy spring and summer months ahead.
According to Lawrence Yun, chief economist for the National Association of REALTORS®, “buyers came back in force (in February) to fuel an increase in contract signings throughout the country.” He added “the stock market's continued rise and steady hiring in most markets is spurring significant interest in buying, as well as the expectation from some households that delaying their home search may mean paying higher interest rates later this year."
For now, however, interest rates are holding in the low 4 percent range and have declined over the past month to the lowest levels of the year. Rates are still higher than they were a year ago and experts are saying they could increase by a half percent by the end of the year.
February’s inventory levels were down 8.5 percent to 5.4 months of supply compared to the same period a year earlier and days on market were down over 15 percent.
“It still remains that qualified buyers will have to decide quickly on a property if they see a home in their price range that meets their needs,” stated Becker. “And having financing in place before starting the home search process makes it easier to lock up a contract to purchase when a decision is made.”
Kentucky REALTORS® is one of the largest and most influential associations in Kentucky. Founded in 1922, Kentucky REALTORS® represents more than 10,300 REALTORS® who are involved in all aspects of real estate, including residential and commercial real estate brokers, sales agents, developers, builders, property managers, office managers, appraisers and auctioneers.
To view housing statistics for the state, as reported to Kentucky REALTORS®, visit housingstats.kyrealtors.com.