New Lexington Homes For Sale Decline
Posted by: Malok in Fayette County, Georgetown KY Real Estate, Jessamine County, Lexington KY Real Estate, Scott County, Versailles KY Real Estate, Woodford County
The ongoing drama with the economy, softening real estate markets, and banks tightening their requirements on loans continue to pinch the credit lines of Lexington area home builders. As a result, the amount of new Lexington Homes for sale are on the decline. This has results in both fewer new Lexington home permits being issued, and a new issue is starting to arise: half finished homes are becoming more commonplace within the community. What is happening is as builders get their credit lines called, they simply end up running out of money and can’t afford to continue to work on homes – which then ends up costing them their permit (Home permits become void after 180 days of inactivity on the job site).
Here’s a few snapshots of the metropolitan area:
In Scott County (for reference: Georgetown KY being one of the major cities), new home permits issued were 768 in 2005. Only 446 were issued in 2007. And for 2008 only 184 have been issued for the first 6 months of this year.
In Woodford County (for reference: Versailles KY being one of the major cities), new home permits issued were 154 in 2005. Only 165 were issued in 2007. And for 2008 only 52 have been issued for the first 6 months of this year.
In Jessamine County (for reference: Nicholasville KY being on of the major cities), new home permits issued were 643 in 2005. Only 307 were issued in 2007. And for 2008 only 90 have been issued for the first 6 months of this year.
In Bourbon County (for reference: Paris KY being one of the major cities), new home permits issued were 54 in 2005. Only 46 were issued in 2007. And for 2008 only 19 have been issued for the first 6 months of the year.
Which brings us to Fayette County and Lexington. New home permits for 2005 were 2469. Only 1235 were issued in 2007. And from January 1 through August 30 2008, 534 new home permits were issued.
So, what does this mean for the Lexington real estate market? It means that the pain isn’t over. The inventory currently on the market has been moving slowly. There are just simply not enough buyers to go around, so if you need to get your home sold ASAP, you are going to have offer the property for lower than you’d probably like to get it sold.
But what about the $700 billion bailout rescue plan? Won’t that help ease the credit crunch by providing banks and lenders some more liquidity? Well, sort of. Lets put you into the banker’s position. The stock market is reeling (it dropped to below 8000 today, and has lost almost 40% of its value in the past year). Banks are failing. People are losing their jobs. Homes are going into foreclosure. Inventory is WAY up on homes for sale….. Now, do you want to lend some money to someone in that market unless you are WAY over collateralized? Probably not. And there you see the dilemna. Even with this “rescue” plan, it will take a long time before things get back to normal in the real estate market. So, if you are wanting to get your home sold – you better plan on doing what it takes. Or you could be waiting for a very long time.
