By Kyle Elmore, Realtor
One of the most frequent question that I get from clients, friends, family and folks asking about real estate in Louisville is whether the current market is a buyers’ or sellers’ market?
This is a trickier question than it might appear on its surface. Most people would think that it is simply a sellers’ market because of rising values, short supply and high demand. But I disagree.
The current housing market in Louisville presents one of the best buying opportunities of the past 20 years. Sure, supply is short and values have risen since 2008, but are they going to stop rising and is supply going to suddenly skyrocket when we stopped building new homes since 2008. I do not think so. But that is not even the main reason I am so bullish on buying real estate in Louisville right now…
It is the interest rates guys. Rates are at or near record lows on a daily basis. When you buy a house, most folks borrow the money from a lender to pay for the purchase. A majority of people borrow that money on a fixed rate loan on a 30 year note. That means that a change in interest rates of 100 basis points or 1.0% makes a world of difference in what you will ultimately pay for the home. Even more importantly, that rise in your rate drastically changes how much house you can afford. You might qualify to buy a $200,000 house today, but when rates rise that number could drop to $175,000 or even lower. Not to mention that you will now also pay more for that house over the life of the loan. So now is the time to buy, buy, buy.
This market is still a buyers’ market and one needs to look no further than interest rates to come to this conclusion.