The number of residential home sales decreased 35% in November from a year ago as transactions dropped below the 1,000 mark for the first time since before the pandemic (January 2020). November sales were 947 compared to 1,447 last year. Single-family home sales declined 34% with 888 sales in November compared to 1,349 sales last year. Townhouses/condos dropped 40% with 59 sales compared to 98 in 2021. Townhouses/condos made up around 6% of the total market in November.
Interest rates were lower in November at 6.8% than the previous month at 6.9% but were still more than double the rate from last year when it was 3.1%. Higher rates have maintained a strong influence on the real estate market, affecting not only sales, but has seemingly affected price appreciation.
“Median home prices are still up over last year,” said Rusty Underwood, president of Bluegrass REALTORS®. “But the spread between year-over-year appreciation has begun to plateau. This is a consequence of the
continued higher rates that have resulted in a decrease in buyers’ purchasing power.”
Although median home prices reached a new all-time monthly high in November, the increase was the lowest year-over-appreciation seen in almost four years. The November median priced home sold for $232,500
compared to $227,000 last year, a 2% bump. The median price dropped from $235,000 in October, however, November marked the 45th consecutive month of year-over-year price appreciation. Single-family home prices stood at $235,000, up 2%, while townhouse/condo prices were $205,000, up 9%.
November’s total volume dropped to over $262 million in residential real estate sold, a 32% decline over last year’s total of $385 million, still the third highest November on record behind the previous two years.
“Prices remaining elevated along with slower sales have led to homes staying on the market longer now then anytime since early this year,” said Underwood. “Additionally, housing inventory is starting to elevate towards a more healthy level, although there is still much ground to make up before available homes meet the demand for the region.”
Housing inventory has risen every month in 2022 compared to the previous year with November reporting a 16% jump year-over-year, hitting 3,168 available homes on the market, compared to last year’s 2,743.
Months of inventory has remained above the 2-month mark for five consecutive months and has risen above the 3-month mark for the first time since the spring of 2020. In November, months of inventory hit 3.3, a 74% jump from last year when it stood at 1.9 and up from 2.8 in October, an increase of 18%.
Days on market (DOM) received another monthly lift in November. Properties remained on the market 27% longer with an average of 33 days compared to last year’s 26 days. The median DOM rose 63% year-over-year, from 8 days last year to 13 days in November 2022, showing that at least half of all homes sold in just under two weeks.
As a result of higher interest rates and uncertainty in the market, new real estate listings in Central and Southern Kentucky dropped 15% compared to a year ago, with 1,087 residential properties versus 1,279 in 2021.
Listings brought to market in November were down 22% from October.
“Sellers that bought a home in the last several years who have a mortgage payment likely obtained a rate that is substantially lower than what can be found in today’s market,” continued Underwood. “This is keeping some potential sellers in their current property, which limits the number of new listings coming to market. Some sellers that would ultimately be turning into buyers have been waiting for a softening in rates, which has been happening over the past couple of weeks.”
As such, pending sales in November dropped to 920 homes under contract, down 27% from last year when pendings were at 1,071.
As the region’s leading advocate for homeownership, Bluegrass Realtors® understands the value and joy of owning a home. The Association represents more than 4,000 Realtors® located in 30 counties: Anderson, Bath, Bell, Bourbon, Clark, Clay, Elliott, Estill, Fayette, Franklin, Harrison, Jackson, Jessamine, Knox, Laurel, Lee, Madison, McCreary, Menifee, Montgomery, Nicholas, Owsley, Powell, Pulaski, Rowan, Russell, Scott, Wayne, Whitley and Woodford counties. Visit www.bluegrassrealtors.com for up to the minute real estate listings and buying and selling resources.