New Homes For Sale in Louisville KY drop sharplyPosted by Jonathan Karlen on Friday, September 2nd, 2011 at 12:23pm.
To review, if you look at the amount of building permits that were issued from 2005 through present, there is an approximately 35% decrease in the number of permits issued through 2007. The specific numbers are as follows:
Jefferson County 2007 2098 permits issued
Jefferson County 2005 3212 permits issued
Oldham County 2007 610 permits issued
Oldham County 2005 358 permits issued
To cite a real example by looking at one of the largest regional new home builders in the Lexington, Georgetown, and Louisville Kentucky real estate markets is Dominion Homes. In 2005, they built 500 homes. In 2007, they only built 200 homes – and at an average price of $20000 lower than the 2005 prices.
Currently, Dominion Homes is providing discounts of up to $30000 as an incentive to new homes buyers for their single family houses, as well as additional incentives to Louisville real estate agents to bring them buyers for their homes.
Many house builders are waiting for the Louisville real estate market to improve before beginning construction on new projects. It makes sense from their view - why build a spec home, when you may not be able to get it sold in a timely fashion after its completed? So, its just better to wait for the market to strengthen this year for new construction, and then kick off new Louisville homes for sale developments once the real estate market is moving again.
But, this type of business activity is causing a ripple effect through many other sectors. All of the contractors, manufacturers and suppliers that make everything from the air conditioners to the flooring are feeling the pinch of builders pulling back on new housing starts.
The lumber yards that have traditionally been primarily residential for a majority of their business, are now reaching out to commercial and multi-family real estate developers to try to acquire new business so they can avoid laying off employees.
Additional hurdles to overcome are the tightening loan applications. Mostly because of the subprime markets and “if you got a pulse, you can get a loan” philosophies of little or no money down – and persons relying on appreciation of their home to build equity, rather than investing any of their own money in the property.
Still, one good thing that we have going in the Louisville real estate market is that we weren’t one of those places where housing values doubled in 3 or 4 years, and as such, our market is much stronger and should recover faster than many other places.
For those looking to make a good purchase, its a great time to buy. A lot of builders have had inventory for a long period of time, and are wanting to get out from under their carry costs on the homes. So, even if they have to take a loss – losing a little now, is better than carrying the additional costs for financing for an unknown period of time. This has opened the door for many buyers that are looking to make a deal in the luxury homes for sale in Louisville KY market. If you can afford to buy, now is the time to jump in and make a deal.
Be the first to comment on this blog entry!