Kentucky Housing Market Vitality

Market Rank

thirty

Kentucky metro area house prices are forecasted to underperform the national market over the next twelve months. Currently, the market is underperforming the overall U.S. market. Compared to 12-months ago, Kentucky’s housing market has strengthened. Current local economic conditions support an estimated 12.7% increase in house prices over the next twelve months. Based on the housing market vitality of the nine metro housing markets which comprise it, Kentucky’s housing market ranks thirtieth amongst all states and D.C. The three-month outlook is negative.

Housing Market Vitality

Housing Market Vitality summarizes the impact of economic conditions on house prices. A value of 100 corresponds to conditions supporting current price appreciation; values less than 100 correspond to a dampening effect and values greater than 100 indicate a positive impact on house prices. A housing market vitality value can be interpreted as a growth rate. Hence, a reading of 105.8 can be interpreted as a 5.8% annualized increase in house prices.

Market Pulse

Kentucky housing market steadies. Investor demand to keep housing market strong as price growth slows.  More »

Sales TrackerAugust 202112-month change
Closed Sales Count5,458-3%
Distressed Sales Count120%
Median Sales Price$220K+10%
Months of Inventory2.1+4.4%
Pending Sales Count7,690-10%
One of the best indicators of the following month’s home sales is pending sales. For the third consecutive month, year-over-year pending home sales continue to drop, signaling a slow and steady recovery to a more sustainable market pace. Pending sales in August dropped slightly over ten percent to 7,690 (from 8,593 in August of 2020). Closed sales were down just under three percent at 5,458. In August, Kentucky’s year-to-date sales stand at 38,379. This is a 7.5% increase from 2020 when that number reached 35,704.

Kentucky Metro Housing Markets

Kentucky is comprised of nine metro housing markets that account for nearly 58% of the state’s population. The Bluegrass State metro housing markets are unique in their demographics and local economies and exhibit trends that are distinct from the national and state narrative. Each metro market presents its own unique opportunity.

METRO AREASITUATIONOUTLOOKUS METRO RANK (/402)
Bowling Green, KYUnderperformingNegative319
Cincinnati, OH-KY-INUnderperformingNegative178
Clarksville, TN-KYOutperformingNegative112
Elizabethtown-Fort Knox, KYUnderperformingNegative187
Evansville, IN-KYUnderperformingNegative221
Huntington-Ashland, WV-KY-OHUnderperformingNegative349
Lexington-Fayette, KYUnderperformingNegative262
Louisville/Jefferson County, KY-INUnderperformingNegative198
Owensboro, KYUnderperformingNegative336

Industry Specialization

Kentucky’s state economy is specialized in Manufacturing and Other svcs. Mining, Information, and Pro Bus svcs industry sectors are less important to the state economy compared to the national economy.

Industry specialization helps explain the differing impact of industry trends on local economies in contrast to industry composition which describes the structure of the economy. A Specialization Index value greater than 100 corresponds to the sector having a greater share of the state economy than it does of the national economy. Sectors with a Specialization Index greater than 120 characterize the local economy.

Demographics

Compared to the U.S., there is a higher incidence of poverty amongst Kentucky residents and they have greater purchasing power. There are more high school graduates and a smaller proportion of the population is college educated. Kentucky’s population is comparatively less diverse than the overall U.S. population.

A Demographics Index value greater than 100 corresponds to the factor being more intense in the state versus the national average. Characteristics of the local population is a longer-term factor that influences the housing market.

Updated October 05, 2021 with data through August 2021