As we shift into the fall season, the underlying theme from this year's narrative remains largely unchanged: low inventory levels continue to weigh down market activity across most price ranges in Louisville. The subtle shifts and trends in the housing landscape noted earlier this year have become more evident over the past few quarters, with implications for buyers and sellers growing increasingly nuanced depending on the specific submarket.
The Overall Louisville Market
While many have been patiently hoping for an uptick in home availability, the overall market's active listings saw a dip of 9.8% this quarter, continuing a trend we've seen throughout this year. This supply crunch was felt most acutely by homebuyers, as the number of homes sold declined by a substantial 17.2%. However, for those selling their homes, the lack of inventory played in their favor with the median price per square foot rising by a respectable 5.9%. Despite the overall uptick in values, this is definitely not 2022's market as we are now beginning to see hot and cold spots depending on the property or neighborhood. Properly pricing a home has become critical as buyers have become more discerning in this high interest rate enviroment and are willing to wait on opportunites. A small number of overpriced listings that lingered resulted in the average days on the market increasing by 26.1%, but properly priced homes are still selling briskly. With just 1.8 months of inventory available, the supply-demand imbalance continues to characterize the overall market landscape.
High-End Louisville Market (Homes $500,000+)
The high-end segment of the market showed more resilience than the overall market, another recurring theme throughout 2023. While it still experienced a 5% dip in the number of homes sold, the decline in active listings was a modest 1.2%, keeping inventory levels nearly on par with last year. Sellers in this segment had to be slightly more patient, with homes staying on the market 22.6% longer than last year, but still fairly short by historical standards. The median price per square foot increased by 4.3% in this segment, reflecting a healthy appreciation in home values, although it continues the slowing trend noted over the past several quarters. With a slightly more comfortable 3.2 months of inventory, the high-end market remains better positioned than the overall market for the upcoming quarter as available inventory should continue to fuel sales activity.
$1M+ Market
Louisville's highest-end segment demonstrated surprising resilience to the broader market conditions, breaking the slowing trends noted above. The number of closed sales surged an impressive 40.4%, underscoring the enduring appeal of luxury real estate, even amidst historically high interest rates. Even with this increase in transactions, 5.1 months of inventory remain available, making this segment well-positioned to maintain momentum. Despite the sales activity, price appreciation was comparatively muted, with the median price per square foot growing by only 1.9% year-over-year.
As we anticipate the close of the year and look towards 2024, it's become apparent that these changing market conditions will continue to offer new challenges and opportunities for both buyers and sellers. Those looking to enter the market, either as a buyer or seller, should be informed and strategic in their approach as one size definitely does not fit all. For sellers, particularly in these times of low inventory, positioning one's property appropriately can make all the difference between a quick sale at an optimal price and languishing listings. And for buyers, patience and preparation are key, ensuring that when the right opportunity emerges, they are ready to act decisively. Need more info on how all of this applies to your next move? Contact us for expert guidance and insight into the current state of the Louisville housing market.
Click to download the 2023 Q3 Louisville Market Report.