Table of Contents

9 min read Feb 06, 2024

Kentucky Real Estate Market: Predictions for 2024

Kentucky homes continued to sell at eye-popping prices last month. The median home sale price rose 6.9% year-over-year from $227,200 to $242,900 in January.

The number of homes sold on the market declined by 2.0% YoY from 2,611 to 2,560 homes, with only 3 months of supply. Does the scarcity of houses make Kentucky a seller’s market? Let’s look at the facts.

Covington homes sold for a median sale price of $214,900 in January, up 22.1% year-over-year. Homes in St. Matthews sold for a median sale price of $340,000, a 23.2% increase year-over-year. There were a few markets in Kentucky where prices declined year-over-year.

Interest rates are at record highs, with few home buyers. But the inventory is so low that 16.7% of homes sold above the list price!

  • If you are a home buyer: You can avoid bidding wars and avail seller concessions if you buy a home now. The 7.28% interest rate and mortgage payments are significant, but rates are unlikely to drop in the next few months. If they do, you can refi.
  • If you are a home seller: You can lock in Kentucky’s high home prices. The scarcity of homes in KY makes it a seller’s market. Homes listed on MLS sell faster and for 17.5% more than off-MLS homes. That could be thousands of dollars in additional proceeds if you sell via Houzeo.

The current Kentucky real estate market statistics reflect the national trend of high demand and low supply. Despite the strong housing demand, home sales tanked. The property prices in Kentucky have increased regardless.

So, How Is the Real Estate Market in Kentucky?

Sluggish! Home values in Kentucky rose by 85.5% in the last 5 years.

But, home sales decreased by 2.0% in January 2024 YoY. Maybe due to the mortgage rate climbing to a two-decade high of nearly 8%! And the number of houses for sale in KY was 12,092 in the month, 4.2% more than in 2023. Kentucky’s housing market is bearish.

The decrease in home sales can be attributed to not having enough properties in the Bluegrass State. The months of supply is 3 months, which makes KY a seller’s market. So, if you want to sell a Kentucky property, now is the right time to list it on MLS.

👉 List Your Kentucky Home for Sale: Would-be buyers and buyer agents scour the MLS for turnkey properties. Start your listing for FREE!

Kentucky Real Estate Market Statistics

  • Average Home Prices: The average median home price in Kentucky is $242,900, up by 6.9% YoY. In 2024, the median sale price will keep increasing marginally due to KY’s tight inventory. The sale-to-list price ratio is at 97.10%.
  • Home Sales: As per January 2024 data, home sales decreased by 2.0% YoY! In January 2024, only 2,560 homes were sold, down from 2,611 in January 2023.
  • Average Rent Prices: Rental costs vary statewide. An average tenant in Louisville pays $1,217, while the one living in Frankfort pays $933.
  • Median Days on Market: The median days on the market for homes for sale was 49 days, up by 1 day YoY.
  • Pending Sales: The number of homes for sale increased by 4.2% YoY compared to 2023. Currently, there are 12,092 homes for sale in Kentucky.
  • Months of Supply: The average months of supply is 3 month. KY’s demand can’t be satiated with the low supply. KY’s house scarcity is worse than the national housing market.

Kentucky Housing Market Predictions 2024

Kentuckians have survived the shockwaves of skyrocketing mortgage rates and rising home prices of 2023. Here’s what we predict for Kentucky’s housing market:

  1. Home Sellers Will Return to the Market in 2024: Sellers who chose the sidelines in 2023 will come back. Especially those who can’t avoid new jobs or want to move to a cheap place. Whitney, the analyst who predicted the 2008 financial crisis accurately, has forecasted that baby boomers looking to downsize will also add up to 30 million housing units. Yowaza!
  2. Mortgage Interest Rates Will Stabilize by the 2nd Half of 2024: Mortgage rates hit 7.79% in October 2023, the highest level in 23 years. However, the rate dropped to 7.35% in November due to the softening labor market and slowing economy. Even the annual inflation rate went from 3.7% to 3.2%. We think the rates will remain above 6%, but they will stabilize in the second half.
  3. The Number of Home Buyers Will Rise: The historically high interest rates averted buyers in 2023. But mortgage demand rose after the interest rates lowered to 7.35% in November. The easing inflation and stabilizing rates will bring back house hunters.
  4. Home Prices Will Continue to Rise: Home prices rose steadily in the top metros across KY YoY, reaching $242K in January 2024. Experts predict home prices will continue to rise until the low supply-high demand dynamic changes.
  5. New Home Constructions Sales Will Increase: 12.3% of homes purchased in September were new homes, the highest since 2022. Home builders offered $30,000 worth of concessions to attract buyers in 2023. We think builders and sellers will compete for buyers in 2024.
  6. iBuyers Will Continue to Make Lowball Offers: iBuyers offered 104.1% of market value in 2021. They offered 86% in 2022 and around 70% in 2023. Opendoor and Offerpad have lost billions of dollars in 2023. As they struggle to survive, they will make lowball offers.
Bonus Prediction: Buyer Broker Commissions Will Be Negotiable!

In a shocking turn of events, the jury in Missouri awarded more than $5 billion in damages to the Sitzer-Burnett plaintiffs. This motivated nationwide home sellers to file grievances against NAR’s Cooperative Compensation Rule.

NAR’s Cooperative Compensation Rule or Participation Rule states that listing brokers must offer competitive compensation to buyer agents if they want to list properties on an NAR-affiliated MLS.

Sitzer/Burnett v. NAR

The Bombshell Lawsuit that Could End Buyer Agent Commissions

Start Your MLS Listing NOW!

Lawsuits like Moehrl, Gibson, Batton, Nosalek, and Batton 2 challenge the Participation Rule. They accuse NAR and other top real estate companies of colluding and conspiring to keep agent commissions high.

If the jury also finds the defendants guilty in these cases, buyer agent compensation may change. Buyer agents may become obsolete by 2025! Phew.

While buyer agents are unlikely to be obsolete in 2024, they may be open to negotiating commissions. That’s probably how they will still have some skin in the game.

When Will the Housing Market Crash in Kentucky?

A housing market crash in the Bluegrass State is unlikely.

Kentucky’s cost of living is 7% lower than the nation’s average. Its robust economy and diverse job market will continue to attract businesses and individuals seeking new opportunities.

Henderson’s median sale price has increased by 35.6% YoY, reaching around $200K in 2024. Middesboro is the cheapest places to live in Kentucky with a median sale price of just $90,092.

Kentucky is a haven for several businesses and industries. Several cities, including Louisville, Lexington, and Covington, offer a variety of fun activities, such as visiting parks, savoring local cuisine, and exploring arts plus entertainment.

Kentucky’s job market is also strong. The unemployment rate is at 4.30%. The average cost of living in Kentucky is $40,816. The median household income is $73,000. Living near the rolling hills and verdant forests of Kentucky is SO AFFORDABLE. It is unlikely that Kentucky’s housing market will crash anytime soon.

2024: Is it a Buyer’s or Seller’s Market?

2024 will be a terrific market for sellers. (And buyers, too!)

Home prices in Kentucky are rising and will continue to rise till the supply-demand dynamic changes. The number of houses for sale in KY was only 12,092 in January 2024. There is very limited inventory to satiate the demand from house hunters. This also makes it the best time to sell a house in Kentucky.

In fact, after the mortgage rate plummeted from a two-decade-high rate of 8% to 7.28% in November, new listings rose. This shows that those who refused to sell due to mortgage rate lock are finally acclimatizing to 7% rates. Come Spring 2024, more homeowners will follow suit and list properties on Kentucky MLS.

As home listings in Kentucky increase, home shoppers hugging the sidelines will also return. In fact, the recent uptick in mortgage applications shows that buyers are returning.

House hunters who could not find affordable homes in 2023 will also start shopping in 2024. The demand for Kentucky houses will increase – and that’s why sellers may be able to dominate the market.

However, new builds will compete for attention from buyers. Home builders have persuaded buyers to buy new construction homes with mortgage buydowns worth $30K in 2023! Builders will continue offering concessions in 2024, and home sellers may have to wage wars against them.

Listings of new constructions, baby boomers looking to downsize, and desperate home sellers will flood the market in 2024. The properties for sale in Kentucky will increase. So, whether you are looking for a condo in Covington or seeking to live in a co-op in Louisville, you will find your dream home next spring.

Find Your New Home With Houzeo

With thousands of property listings, is one of the biggest home listing sites in the US. Find condos, townhouses, co-ops, and other homes for sale on Houzeo.

homes for sale

Disclaimer: This article is for informational purposes only. It does not constitute an offer, solicitation of an offer, or any advice or recommendation. Houzeo doesn’t provide any legal or financial advice. The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Houzeo Corp., its affiliates, or its employees. However, the author does not make any representation or warranty, express or implied, as to the information’s accuracy or completeness, nor does the author recommend that the attached information serve as the basis of any investment decision.

Frequently Asked Questions about Kentucky Real Estate Market

When will the housing market crash in Kentucky?

Not for the next few years. Kentucky's housing market will not crash in 2024. Despite 2023's skyrocketing interest payments and soaring home prices, Kentuckians have managed to keep the market afloat.

What are the real estate housing market 2024 predictions for Kentucky?

2024 will be a stellar market for Kentuckians. Here's our 2024 forecast for Kentucky housing market are: (1) Home sellers will return to the market come Spring 2024. (2) Number of houses for sale will increase (3) Property prices in Kentucky will increase marginally (4) Mortgage rates will stabilize in the latter half of 2024 (5) iBuyers will buy homes for lower than their fair market value. (6) Buyer agent commissions will be negotiable!

Are home prices dropping in Kentucky?

No, the property prices in Kentucky were up by 6.9% YOY in Jan 2024. However, you can still find some of the cheapest places to live in Kentucky. With a 85.5% rise in the past five years, exploring budget-friendly cities is crucial amid the current scarcity of available properties in KY.

Is it a good time to buy a house in Kentucky?

Yes! Currently, there are very few buyers in the market compared to the supply of homes in Kentucky. The soaring interest rates has kept buyers at bay, so you can avoid bidding wars. As the mortgage rate stabilizes in 2024, more buyers will return, so we'd recommend you to buy a house now. If mortgage payments burn a hole in your pocket, you can always refinance.

» Best Time to Buy a House in Kentucky: Find out the best time to buy a Kentucky property & plan your finances accordingly.

Eager to Know How Houzeo Works?

We’ve got you covered. Check out the following video to understand how Houzeo works and why it is one of the best For-Sale-By-Owner Websites in the U.S.

What is Houzeo?

An overview of what the platform is all about

Start Your MLS Listing NOW!

» NEED MORE CLARITY? Read these exclusive Houzeo reviews and learn why it is one of the best FSBO sites in America.

Kentucky Real Estate Market

Save $20

On Silver & up plans

Use Coupon Code:

Need help? Call us on
(844) 448-0110