Friday, November 2, 2007

The State of Real Estate in Louisville, KY

I'm always looking for a good place to throw in a cheap cliche and the current real estate market in Louisville has afforded me another great opportunity; 'may you live in interesting times'. While this is actually an ancient proverbial curse, it seems quite apt to what we are seeing today in the Louisville area.

For years, home owners, Realtors, mortgage lenders, investors, and other participants in the real estate market have enjoyed quite a boom in business and income. Unfortunately, certain aspects of fiscal responsibility were ignored, such as the value of good credit, the importance of access to a cash reserve, and the recognition that buying a home is just not for everyone. This perfect storm brewed under the radar until this past year when we finally reached a point where the housing inventory had increased to near record levels, and the number of previous buyers who were risking, or actually in, default multiplied dramatically.

While Louisville is not alone in this situation, because most major real estate markets remain somewhat isolated from each other we must face our challenges regardless of what happens in the rest of the Nation. As a Realtor, I make my living from helping people buy and sell homes. It is very important to me that the market is positive, that the public has enough confidence in the economy to continue to invest in real estate, and that we take proactive steps to reduce the possibility of further damage to our already fragile market.

What are some solutions to the present challenges brought on by our past actions? From a pure business standpoint, real estate industry professionals must continue to control costs and find better ways to do their jobs to help the consumers save money. In addition, we must educate our customers and clients to ensure that they make the best decisions possible for themselves given their personal and financial status, not what we think is best for us. As I said before, just because you can afford a home doesn't mean you should buy. And finally, we must remain positive and realistic about the market. It is a provable fact that Louisville's real estate market is still as active as in years past, we just have such a large unsold home inventory it masks this knowledge.

I welcome your comments on this topic and look forward to seeing a variety of opinions!

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