The advertisement you see above is one that the National Association of Realtors in putting in a number of publications lately. Their intent is to make sure that people are aware that now is a good time for them to out house hunting.

I don’t have a problem with their intent but I believe their execution is very disappointing. As a real estate professional, I know the many reasons that now truly is a good time for certain consumers to be house shopping. Chief among them are, 1) the historically low interest rates, 2) the never before seen tax credits from the government, 3) the reduced home prices, and 4) the large house inventories across the country.

But it seems that NAR is only focusing on the tax credit portion. Check out this commercial.

Nothing really wrong with this spot but I believe there is so much more they could have done. With interest rates expected to rise in 2010 along with the other variables I just mentioned, I would have thought a more comprehensive message would have served better. But because you read Louisville Homes Blog, you’re getting the entire picture.

For home sellers, the fourth straight month of home value increases is a breath of fresh air after all they’ve been through. Home values are still down from highs that occurred in 2005 and 2006 (depending on market) but it’s most assuredly a step in the right direction. As prices continue to rise, expect to see more sellers list their homes, especially in the Spring.

Home buyers, on the other side, are seeing the end of bargain basement prices that many have enjoyed during this housing downturn. As prices return to more normal levels, Louisville home buyers will now need to pay a little more to get their choice home.

Inventory levels are still high (7,754 active listings for single-family homes in the Louisville MLS) and interest rates are just a point higher than the 30-year lows we experienced in 2003 (see below). In this environment, home buyers are still getting two of the three important factors to lean in their favor.

The other piece of news in the WSJ article highlights that consumer confidence is down and appears to be dropping. This makes sense in light of the current unemployment situation but also points to consumers having little optimism about the direction our economy is heading. The current administration is spending money at a record pace while small business continue to bear too large a tax burden to truly foster innovation on a large scale.

Based on this, all consumers are being wary about how they spend their hard-earned dollars and understandably so. A great deal will always depend on your particular situation.

If you are considering a real estate transaction, my best advice is to find a trusted Realtor® and chat with him or her about your home and future plans. If you’d like to contact me, I always welcome emails from my readers.

Well, here at Louisville Homes Blog, I’d rather tell you the whole story and let you figure out what it means. So here in our ultra-concise delivery method is the 2008 Year in Review for Louisville, KY Real Estate.

Home Values in Louisville

First, you need to understand that most valuations you find online are truly estimates. Some are wildly inaccurate while most are merely averages. Averages are fine if your home is an average home but most aren’t. Even still, with the plethora of free online information, we’d be silly to dismiss it.

According to this chart from RealtyTrac, the median home value in Louisville dropped about $1,300 in value during 2008. This amounts to about a 1% loss.

We reported in November one analyst reporting the drop in value to be -3.6%. If you look at Trulia, they have 2008 being almost a wash.

I think a drop of 2-3% is probably reasonable, which is a real negative when you consider home values in Louisville have risen 4-5% every year for the past five decades.

Home Sales in Louisville

This calculation is quite simple and very reliable given that the data is coming directly from Louisville’s MLS system.

As you can see, Louisville has certainly dropped from the high number of sales in 2005 and 2006. But properties are still selling in numbers larger than the first three years of this decade.

Foreclosures in Louisville

Since this is the most negative news in real estate today, it’s no big surprise to hear the media clamor on and on about it. So how is Louisville doing compared to the rest of the nation?

About as expected, things are the worst on either coast and Florida. Good news for us in Kentucky is that we have fewer foreclosures than our neighbors in Tennessee, Ohio and Indiana. As always, be conservative when considering an amount to borrow for the purchase of your home.

Conclusion

All in all, it was a down year for real estate here in Louisville but not nearly as bad as the media has made it out to be. Given the historically low interest rates and depending on your situation, now could possibly be the best time to make a move in real estate.