After a small blip in July, real estate sales over the past two months have lunged forward and reached all-time highs in both August and September. Some of the increase is due to the addition of newly reported sales in the counties surrounding Lake Cumberland, however, sales across the board remain strong. Transactions in September pushed total sales to 1,494 in 2021 compared to 1,384 last year, an increase of 5% year-over-year and a new record for the month.
Total sales for the first three quarters of the year remained up 6% from 2021 with 11,872 transactions closed in the first nine months of the year, compared to 11,186 during the same period last year. Many of the sales increases have occurred in the rural areas of the jurisdiction and in Fayette and Jessamine counties.
New construction home sales slipped year-over-year for the sixth straight month, with September sales standing at 97, a decrease of 29% over the 137 sales in 2020. For the year, new home transactions have dropped 17%.
“Market activity is still really strong going into the last quarter of the year,” said Kristy Gooch, president of the Lexington-Bluegrass Association of Realtors® (Bluegrass REALTORS®). “As the inventory pushes up, prices are softening for buyers. Ultimately with more selection, showings are starting to creep back up as well.”
Median home prices rose 5% in September, hitting $220,000, up from $209,900 in 2020. Although a record high for the month, the median price broke a 14 consecutive month of double-digit growth and continued a three-month streak of month-over-month declines. September marked the 31st straight month of year-over-year appreciation.
Year-to-date, median prices for all residential sales stood at $221,000 compared to $195,000 in 2020, an increase of 13%.
Total sales volume of home transactions exceeded $387 million in September, a 16% increase over last year when the total was just over $335 million. Total volume surpassed the $3 billion mark for the year, which is the first time volume exceeded $3 billion by the end of the third quarter.
Housing inventory has been on the rise since early summer with four consecutive months of gains, the first time in two years with that stretch of increases. Inventory received a boost with the addition of the Lake Cumberland region in July, however, September showed a substantial jump in the number of residential homes on the market with 2,422, rising 10% over the previous month (2,214) and down only 10% from 2020 (2,693).
A boost in new listings has helped push inventory levels up as September saw a record number of homes come online. With 1,789 new properties, September saw a 23% increase over last year with Fayette and Jessamine counties experiencing a surge of new listings, in addition to the Lake Cumberland region properties being added.
For the year, new listings have jumped 6% with 14,663 through the first nine months, compared to 13,783 in 2020.
The increase in new listings helped push inventory to a 1.6-month supply, up 14% from last year and the highest since June 2020.
“Going into the fourth quarter of the year, we should continue to see an active market with more inventory,” says Gooch. “This will allow buyers to take their time and view more properties before submitting an offer. Even though demand remains high to be in this region of the country, the pace should start returning to normal.”
Homes selling in September rose from an historic low, coming in at an average of 21 days, still 45% lower than the 38 days it took in 2020, but up from the 17 days last month.
For the second month in a row, pending sales were up year-over-year, rising 19% in September with 1,513 sales under contract, a monthly record, compared to 1,272 last year. This may signal an unseasonably strong fourth quarter for real estate and will keep transactions moving on a record setting pace for the year.
Showings for properties skyrocketed after the first week in September, breaking a three-month downturn. For the month, the 21,609 showings were up 10% from last year (19,631) and edged up slightly from the previous month when showings were 21,542.
Interest rates inched ahead in September but still remained under a 3% average overall, giving buyers confidence in their home search. But with an upcoming Federal Reserve meeting in November, rates could see an increase if the Fed tapers support for the mortgage market.
“Buyers may soon see an uptick in mortgage rates,” continued Gooch. “Locking in a rate when you know you are ready to buy can help keep your rate low and increase your purchasing power when fluctuations occur. Going into 2022, predictions are rates will adjust upward - some say maybe as high as 4%."
As the region’s leading advocate for homeownership, Bluegrass REALTORS® (Bluegrass REALTORS®) understands the value and joy of owning a home. Bluegrass REALTORS® represents more than 3,500 REALTORS® located in 26 counties: Anderson, Bath, Bell, Bourbon, Clark, Clay, Elliott, Estill, Fayette, Franklin, Harrison, Jackson, Jessamine, Knox, Laurel, Lee, Madison, Menifee, Montgomery, Nicholas, Owsley, Powell, Rowan, Scott, Whitley and Woodford Counties. Visit www.lbar.com for up to the minute real estate listings and buying and selling resources.