May 23, 2017

Louisville Home Sales Stalled By Red Tape!

It’s enough to make your blood boil! At a time when home sales should be brisk, new government regulations, ultra tight mortgage requirements and overworked (and angry) appraisers have slowed down home sales in Louisville Kentucky and around much of the rest of the country. On the surface the sales numbers are better than a year before but they could and should be a lot better! To understand what’s going on we need to examine two separate sets of numbers. To start with the number of homes sold in August 2009 was up 11% over the same month in 2008 (68 of those homes were new construction). But at the height of the buying season, with lower interest rates and that $8000 first time home buyer’s tax credit, homes sold in August compared to just a month before were down 15%. The reason fewer homes closed can be directly tied to those tighter mortgage requirements and the new government regulations that went into effect May 1, 2009. The guidelines call for much tighter appraisal requirements and squeaky tight FHA inspection guidelines. Add those items to the new 3rd party rule (mortgage companies’ can no longer talk to an appraiser and have to go through a 3rd party) and we have the perfect cocktail for a home closing meltdown!  

The second part of this equation focuses on the number of homes going under contract in August 2009, that number wasn’t as good as the month before (down 6%) , but homes going under contract in August 2009 were actually up 15 % from the year before.

Simply put the numbers show buyers are still out there looking for homes. Many of them are 1st time buyers but as those 1st time buyer homes sell, the sellers of those homes will move up the buying chain.  But putting all sellers and buyers through government hoops to get approvals will only hurt the home sale market. Additionally if the government doesn’t extend or expand the $8000 1st time tax credit, sales could grind to a halt.    

The answers to the problem are simple. Put a moratorium on the new appraisal standards until all bugs can be worked out. Keep mortgage companies from requiring 1st born children as collateral for a loan. Finally extend and expand the tax credit from $8000 for 1st time home buyers to $15,000 for all buyers. Add an extra $10,000 tax credit for anyone buying a new home or contracting with a builder to build a new home. Finally allow all buyers to purchase foreclosed property and make low interest loans available to those foreclosure buyers to hire builders and contractors to repair those homes. Now we’ve got a recipe to put the country back on track and a shot in the arm to the economy! Head to www.weselllouisville.com for more info.

 

August 2009

 


Number of Houses Under ContractThis month: 1211

Last month: 1284

This month last year: 0

 

 


Number of Houses Sold & ClosedThis month: 1084

Last month: 1276

This month last year: 0

 

 

 


Average Selling PriceThis month: $165,787

Last month: $171,793

This month last year: $0

 

 


Average Days on MarketThis month: 85

Last month: 89

This month last year: 0

 

 


Median Sales Price

136,800

 

August 2008

 


Number of Houses Under ContractThis month: 1030

Last month: 998

This month last year: 0

 

 


Number of Houses Sold & ClosedThis month: 965

Last month: 1015

This month last year: 0

 

 

 


Average Selling PriceThis month: $181,165

Last month: $173,521

This month last year: $0

 

 


Average Days on MarketThis month: 90

Last month: 92

This month last year: 0

 

 


Median Sales Price

140,000

 

August 2007

 


Number of Houses Under ContractThis month: 1334

Last month: 1558

This month last year: 0

 

 


Number of Houses Sold & ClosedThis month: 1519

Last month: 1461

This month last year: 0

 

 

 


Average Selling PriceThis month: $179,782

Last month: $181,429

This month last year: $0

 

 


Average Days on MarketThis month: 74

Last month: 75

This month last year: 0

 

 


Median Sales Price

141,800

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