Louisville home market could take years to level off

LOUISVILLE, Ky. (WDRB) -- With the home market the hottest it has ever been, realtors say they're removing For Sale signs almost as fast as they're putting them up.

Paula Barmore, president of the Greater Louisville Association of Realtors, said in 28 years in the business, she never thought it'd get to this point.

"I did not think it was possible that we'd be at the point that we are now with as many people having multiple offer situations on the homes that they're trying to buy," she said.

On top of having more competitors to beat out, there are fewer homes being built for people to try to buy.

Juva Barber, executive vice president of the Building Industry Association of Greater Louisville, said supply chain issues are causing delays in production.

"It has made it challenging in a way we have never encountered before because it changes daily," Barber said. "Sometimes, it's difficult to get lumber. Sometimes, it's difficult to get garage doors. Back in the '90s, we were pulling about 6,000 permits per year in the entire MSA, and now, we're pulling only about 3,000 permits. We were obviously impacted by the recession and then we have never caught back up again."

Barber said in the Louisville market, it's about a two-year process before the actual building can even begin.

"It's hard in this market, especially in Jefferson County, to develop," she said. "It's gonna take us a while, because we're already so behind. It's going to take us a minute to catch up."

Barmore and Barber said the issues are impacting all kinds of buyers, from those looking to leave apartments into their first homes to those already in homes looking to downsize.

"People who are thinking of buying, they're worried about where they're going to go to," Barmore said. "So they're not going to put that home on the market. They're worried. They don't want to be homeless or move in with mom and dad.

"The entire market is impacted, because if you can't buy your first home, the person who's living in their first home can't move up. So the move-up market is impacted as well."

Experts said it could likely take two to three more years for the market to cool off.

"Some people have made over a 20% profit from 2019-22 on their homes," Barmore said.

Those looking at homes should expect to pay more and to come in with their most competitive offer on the table.

"Be prepared to make a quick decision," Barmore said. "If you sleep on it, you may not sleep in it. You have the opportunity — probably once — to get in front of the seller. Put your very best foot forward and let your agent guide you to the most competitive offer you can probably do."