Buyers shopping for a home at the start of the year saw inventory levels in January higher when compared to the previous two years. Active residential inventory levels stood at 2,613 homes, up 17% from the 2,231 homes on the market in January 2022. This increase is mainly a result of slower sales throughout the region which has helped boost inventory numbers as well as months of inventory and time homes are remaining on the market.
Months of inventory has remained above the 3-month mark for three consecutive months and risen, year-over-year, for nine consecutive months. In January, months of inventory hit 3.6, a 57% jump from the previous year when it stood at 2.3. The January months of inventory level was the highest it’s been since December 2019 when it hit 3.9.
Days on market (DOM) has been trending up for the past six months, starting when interest rates began to climb, and received an increase in January with properties remaining on the market 50% longer this year with an average of 45 days compared to 30 days in 2022. January is the highest monthly average since July 2020 when it was 48 days. The median DOM rose 150% year-over-year, from 10 days in January 2022 to 25 days this year.
“A slower number of housing transactions has given buyers more options as homes are staying on the market longer,” said Kelley Nisbet, president of Bluegrass Realtors®. “To keep this momentum, however, we need to maintain inventory levels throughout the region with new listings coming to market and it’s proving to be a challenge.”
New real estate listings in the region dropped 5% in January compared to a year ago, with 1,101 residential properties versus 1,160 in 2022. New properties coming to the market is the lowest January total in over 15 years signaling that potential sellers may be hesitant to list their homes.
Pending sales in January dropped to 1,023 homes under contract, down 13% from last year when pendings were at 1,179 but up 39% from the previous month when they stood at 738. The current pending sales total is tracking with pre-pandemic levels of 2018 and 2019.
Residential home sales decreased 30% in January from a year ago, 719 sales in 2023 compared to 1,025 last year. Single-family home sales stood at 679 and dropped 29% while townhouse/condo sales were 40 and declined 33% in January.
“Interest rates are still having an effect on homes sales,” said Nisbet. “Both for new buyers who would be taking on a higher mortgage rate and decided to stay on the sidelines temporarily and for those who purchased in the past couple of years when rates were historically low and are unwilling to give up that rate through the sale of their current home.”
Median home prices reached a new all-time monthly high in January, hitting $243,000 compared to $225,000 last year, an 8% increase, and a 1% jump from the December median of $240,000. January marked the 47th consecutive month of year-over-year price appreciation. Single-family home prices stood at $242,900, up 7%, while townhouse/condo prices were $250,000, up 45%.
January’s total volume dropped to $208 million in residential real estate sold, a 21% decline over last year’s total of $264 million, but ranks as the third highest January on record behind the previous two years.
Central and Southern Kentucky are faring better than the country as a whole as home sales on the national level retreated almost 37% year-over-year and the median price rose to $359,000, nearly 48% higher than what is found in the Bluegrass region.
“Our region continues to be a desirable place to live and work,” continued Nisbet. “As we settle back into a typical market, we may continue to see year-over-year fluctuations in sales and other market indicators, but that’s largely because the last two to three years were a frenzied time in real estate. This year should wrap up to be more on pace with what has been historically normal.”
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.