There aren’t enough flame emojis on the Internet to describe the Lexington housing market. According to a report from Rocket Homes, the median home in Fayette County sold for ~$302,000, a 6.6% jump year-over-year. Yowza.
Prices show few signs of cooling off. But for those hoping to dip their toes in the home-buying waters soon, it helps to know what trends to expect. Put on your floaties, and let’s hear what the local experts predict.
Look out for the ‘burbs
Corey Brown, a realtor at The Brokerage, said the big story for 2024 will be the rise of the suburbs.
“I think that your areas around Masterson Station and Hamburg will be hot zones... but a part of that is because those are the areas that have the most available land for new construction and subdivision development,” said Brown.
While the average for a single-family home in Lexington is averaged at ~$284,000 according to data from Zillow, Brown said that fewer resale homes on the market means “buyers are turning to new construction.”
Don’t give up on LEX
Buyers hoping to find areas with a bit less competition may want to take Brown’s advice and turn to the suburbs, which he says is “the closest thing that would resemble affordable housing.”
But don’t fret, aspiring city dwellers. Jimmy Turek, realtor at Bluegrass Sotheby’s International Realty, also pointed to Castlewood Park, Highlawn, Southland, and Meadowthorpe as “hotspots for 2024.”
Worth it to wait?
Rocket Homes currently lists Lexington as a “seller’s market,” meaning prices are trending high while also selling fast.
Brown says that, with interest rates cooling off at the end of 2023, he believes it makes more sense to purchase the home you want, then refinance in a few years if necessary.
“If you see a home that you really like in an area that you really like, there’s a high possibility that that home...may not come available for while,” said Brown. “The best time to buy... is when what you’re wanting is available for you.”
What about renting?
Brown said Lexington’s rents have remained inflated, averaging around ~$1,300 per month. While a recent study from financial services company Empower listed Lexington as the twelfth-most affordable market for working adults, Brown doesn’t anticipate rent prices to fall anytime soon.
Eyeing places south
While North Lexington continues to flourish and build a greater connection between town and surrounding towns like Georgetown, Turek adds that south Lexington shouldn’t be overlooked. In particular, he calls out Harrodsburg Road, which is a hub of some massive developments.
“There is a ton of commercial development happening and more specifically, The Fountains at Palomar,” said Turek. “The addition of Publix, Bella Cafe, Orangetheory Fitness, Tupelo Honey, just to name a few will be a huge asset to this side of town.”
The supply + demand problem
Turek expects more people to buy homes “as interest rates continue to trend downward,” which could lead to an increase in supply.
However, Brown added that competition plays a major factor in housing availability.
“There aren’t a lot of homes out there, so therefore prices [to purchase] a home are a bit inflated,” said Brown. “Lexington is a desirable area to live... the population grows at a rate that’s faster than we can supply affordable housing.”
In simpler terms, that means constructing more homes equals more supply, which could help cool prices off. As of now though, demand is hot.
Our local city government has created the Office of Affordable Housing with the goal of leveraging public investment to preserve, produce, and provide safe, quality, affordable housing.
Last year, the city hosted the Kentucky Affordable Housing Conference, where development and real estate experts gathered to address gaps in housing across the state. In Lexington, multiple affordable housing projects have opened or been announced.
