LOUISVILLE, Ky. — Louisville, one of the market areas served by members of the Greater Louisville Association of REALTORS, has been ranked No. 3 on the Realtor.com 2023 Top housing markets forecast. Market areas on the list were selected because they are poised to see the strongest combined growth in home sales and listing prices in the coming year. Up to this point, they have seen lower price increases and a relatively smaller affordability crunch than other markets across the U.S.Mainly concentrated in mid-size markets east of the Mississippi, with local industries tied to manufacturing, education, healthcare and government, this year’s top 10, in rank order, are:
- Hartford-West Hartford, Conn.,
- El Paso, Texas,
- Louisville, Ky.,
- Worcester, Mass.,
- Buffalo-Cheektowaga N.Y.,
- Augusta-Richmond County, Ga.,
- Grand Rapids-Wyoming, Mich.,
- Columbia, S.C.,
- Chattanooga, Tenn., and
- Toledo, Ohio.
See Realtor.com’s 2023 Top housing markets forecast for the full ranking of the 100 largest U.S. markets.
Home sales across the top 10 markets are forecasted to grow by 5.2% year-over-year in 2022, whereas the national homes sale projection is for declining sales (-14.1%). Additionally, average home prices in the top 10 are expected to increase by 7.3% – compared to 5.4% for the U.S. as a whole.
- Projections for Louisville et al., Ky-Ind.:
- November 2022 median home price: $290,000
- Forecasted 2023 home sales change: +5.2%
- Forecasted 2023 home price change: +8.4%
- Forecasted 2023 combined sales and price change: +13.6%
At a time when housing costs are a concern for many, areas like Louisville offer relative affordability, having experienced less of a price surge than other extremely hot, pandemic-era markets. They also have a greater share of homeowners who own their homes outright, without a mortgage, giving more residents equity to build on. In the top 10 markets, about 23% of housing inventory is affordable at the median income level, compared to just 17% of affordable homes nationally. Better affordability offers some insulation from the impact of rising mortgage rates.Top Markets Sidestepped Steep Prices of 2022According to Realtor.com’s analysis, this year’s top 10 housing markets didn’t get as caught up in the wild buying frenzy – and price increases – of 2022 as other areas. Sale prices in the 12 months ending August 2022 increased by 10.5% on a year-over-year basis, compared to a growth rate of 12.6% for all 100 largest metros. The top markets have also seen less of a dip in sales in recent months, with sales declining by 9.1% year-over-year, compared to an average decline of 12.3% for all 100 metro areas.Buyers Take Advantage of Government-Backed LoansHome sales in the top 10 metros also tend to leverage more government-backed mortgage products such as VA loans and FHA loans. Between Jan.-Aug. 2022, the share of mortgaged-sales with a VA loan was 9.4% in the top 10 markets vs. 7.5% among all the 100 markets reviewed. These types of loans help buyers safely enter the market with lower down payments and often slightly lower mortgage rates.Click here for more Kentucky business news.