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Home Sales in Greater Louisville Remain Low Despite August Gains

Homes sales in Louisville increased in August when compared to August 2010 numbers,  according to data released by the Greater Louisville Association of Realtors.

August saw over a 20 percent increase in sales when compared to the same month last year, but the housing market in the Louisville region continues to struggle compared to past year’s averages. GLAR numbers should be considered in a larger context and it’s important to look at the broad picture when considering where the market stands, said realtor Greg Fleischaker.

“I can tell you I’m the tallest person in my family and that tells you nothing. But I am. I’m the tallest person in my family, but I have two kids that are thirteen and eleven so it doesn’t tell you much. So it all depends on what you’re comparing it to,” he said.

To put it in a larger context, Fleischaker used data from GLAR and created two graphs. One shows August sales over the past dozen years, which does not tell the whole story, he said.

“August of 2011 actually brought the average up which is even more frightening, right, that our average sales have been so low that this past August actually brought the average up. So yes, we had a relatively good month in August, but that just tells you how bad the first seven months were this year,” said Fleischaker.

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Home Sales in Louisville See Decline

Louisville home sales over the past year are down from the previous 12 month period.

The Greater Louisville Association of Realtors announced that June home and condo sales have dropped by 23 percent when compared to June 2010, while the median home price stayed around $140,000.

This is partly due to a tax credit that Congress awarded last year to homebuyers, but that can make it hard to predict the affects the tax credit had on the market, said Brent Shaw, a Realtor with Rick Shaw Realtors and member of the Greater Louisville Association of Realtors.

“That was a boost doing the tax credit program. Whether it was a short term boost or not it’s going to be hard to tell. It’s probably going to take a couple years to really see what it did to the overall market,” said Shaw.

Members from the Greater Louisville Association of Realtors have sold more houses in June than any month this year, but the number of home sales in the summer is always highest, said Shaw.

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First-Time Homebuyer Tax Credit Deadline Approaches

by Gabe Bullard

The first-time homebuyer federal tax credit will expire Friday. Anyone who has not owned a home in the last three years must be in a binding contract by then and close the sale by the end of June to qualify.

The tax credit took effect last year with the passage of the federal stimulus legislation. Louisville Remax Advantage Associate Broker Paul Kiger says it’s driven home sales up in the last three quarters, and the new buyers are less likely to default on their mortgages.

“People that are buying now are the solid buyers,” he says. “There’s no creative financing method out there. They’re very responsible consumers. At the end of the day it’s the banks money and the bank wants to know everything about them.”

Kiger says the tax credit has affected the entire housing market, since customers who sell their homes often use the money to buy more expensive homes. Kiger says that trickle-up effect will likely keep home sales strong once the credit expires.

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Realtors Association Optimistic About Home Sales

The Greater Louisville Association of Realtors says home sales numbers for July are encouraging.

The housing slump hit Louisville last year, causing a drop in home sales and construction. But Association Vice President Lisa Stephenson says sales are picking up, and it goes beyond the typical summer sales increase.

“As the summer months approach, the market gets better and better,” she says. “But what I’m looking at is how that curve looks compared to the way it was last year and we’re starting to see a higher peak than we saw last year.”

Stephenson says June sales showed signs of improvement, and July 2009 is shaping up to surpass July 2008 in total sales. She attributes the slight recovery to growing comfort with the economy and the increase in the new home buyer’s tax credit.