lexington news

LEXington market trends

by John Rice

Ok, we all know there is a shortage of inventory and houses are selling fast….but there is more going on in this town than just that.

Here is what I am seeing in 2016:

  •  Waiting.  Lots of waiting in line to see a new listing it’s first day on the market.  Everybody is so focused on new listings.  Granted, you do want to see them before they sell, but I think there has been more of a shift in how the public gets listings.  Everybody has saved searches and gets alerts when there is a new listing.  If it doesn’t interest them at that very moment, they rarely will consider seeing it later.  They just wait for the next new listing.  That is bad news for sellers who don’t sell their houses immediately, and proof that starting out with the best presentation and the right list price is critical.
  • Not ALL houses are selling as fast as you would think.  Only the good ones are selling immediately.  In Fayette County, there are 555 houses for sale priced between $100k and $500k.  Of those, 152 have been on the market for more than 90 days.  That is almost 1/3 of the available houses.  Savvy buyers go back and look at those 152 to see if they can get it for cheaper and avoid the multiple offer frenzy.
  • New construction on the edge of town isn’t doing so well.  I think Lexington is finally big enough that people see a big difference between being closer in town and on the edge of town.  I am seeing more and more people wanting to be closer in to town….heck, I feel that urge too since I live just past Hamburg and am always stuck in traffic.  One of the most successful new construction neighborhoods has been Summerfield.  I think it is about location more than anything.  You are 10 minutes from downtown and 5 minutes to Hamburg.  The best of both worlds really.
  • Smaller ranch houses in nice neighborhoods are getting amazing money.  I’m seeing 1200-1400 square foot houses getting close to $170k in neighborhoods like Cooper Trace, Ashbrooke, Wyndham Hills, Wyndham Downs and Harrods Point.
  •   Lots of people retiring in Lexington…..even Clint Eastwood is moving here, if you believe everything you see on Facebook 😉  An area super popular with retirees is Brookhaven and Lansdowne.  There are lots of nice ranches on good lots in this area.  You are close to downtown, can hop on New Circle at Tates Creek and go anywhere, cut across roads like Regency, Larkin, Zandale or Reynolds to get to anything on Nicholasville Road.  Plus you have cool places like The Lansdowne Club, Lansdowne Shoppes and are 1o minutes to Chevy Chase.

It sure will be interesting to see what comes for the rest of this year.  I am hearing from other realtors that they are having a hard time getting on a photographer’s schedule.  That either means we have a lot of new listings about to hit the market or realtors are just really impatient to get a house on the market!

 

How hot is the market?

by John Rice

16 showings and 5 offers the first day on the market.  Granted, it was in a very popular neighborhood, but still….that’s hot!

I had a lot of fun that day.  It was stressful as heck.  Trying to keep up with all the showings.  Then the offers started rolling in.

I try to put my new listings on first thing in the morning or in the evening.  I want every buyer in the market to see the house on it’s first day.  If you put in on midday, you get some showings that day and then some more the next.  I love it when I know buyers are seeing others buyers coming and going all day.

The first offer was full price and contingent on selling a property.  That one was out pretty much from the beginning unless we didn’t get other offers.  Then an offer for nearly full price but contingent on closing a house.  That is better.  Then an offer close to full price but contingent on nothing to sell or close.  That was a good one.  Then a full price offer contingent on closing a house.  Then a lower offer that gave the sellers and I a good laugh.

Once I told all the agents about the other offers we had in hand, one of them raised their offer to just over the asking price.

What you do in these situations is pick the one you think is most likely to work out and try to get them to meet the better terms of the other offers.  So, we countered the offer with no contingencies for the highest price offer we had.  Those people came up to the full asking price, but wouldn’t go higher.  NEXT!  We then countered one of the offers that had a contingency to close.  We picked this one to work next because the buyer had better financing terms and a house that would be easier to sell should that buyer’s sale fall apart.  That buyer got the house.

While it was fun and I did get my seller the absolute best deal possible, it was a little tough for me.  I knew 3 of the 5 agents.  It was hard to tell them that their buyers did not get the house.  I thanked them all and explained why we went with the offer we did.  They all did a great job playing the cards their clients dealt them…..I only wish I had 4 other listings just like this one to sell them.

What The LEXpert has been thinking about

by John Rice

Here are some things that have been on The LEXpert’s mind lately:

 

  •  I am seeing more and more interest in the houses around Liberty Road and Henry Clay Blvd.  About 25 years ago I saw that once Kenwick got expensive, interest would move to the Courtney/Clayton area.  And once those prices shot up, it would keep going further down Henry Clay Blvd.  What I didn’t see back then was that Delaware would become a hip spot for businesses and restaurants.  Back then, we all thought it would remain the scuzzy industrial area it had always been.  You watch, once the National Avenue area gets filled and rents go up, you’ll see more businesses you want to frequent along Delaware and Winchester Road.   The great thing about the Henry Clay/Liberty Road area is that you are minutes to downtown, minutes to NoLi, and minutes to Hamburg.  It really is an ideal location.

 

  • Greenbrier is seeing a lot of sales.  I have seen several that sold by word of mouth lately.  A couple others sold extremely fast.  I think it mostly has to do with the new school districts.  It is no longer a nice neighborhood on the wrong part of town thanks to Hamburg.  It is also no longer a nice neighborhood with a poor performing school district.  It will attract people who want to have their kids in public school now.   That makes for a broader market.  That means more buyers for fewer houses.  That means prices go up.

 

  • The $350-500k market is strong in Lexington still, even as we get late in the year.   Sales seem to come in waves.  There might be a few slow weeks for certain parts of town and then, all the sudden, that area will have lots of sales in one week.

 

  • Century Hills is blowing my mind.  I have seen several 3 bedroom/1 bath houses without a garage sell for over $100k, some close to $110k.  It wasn’t too long ago that the nicest ones out there were $95k!  Percentage wise, that is a huge increase.  Looks like we are back to the days where under $100k doesn’t get much.

 

  • I think that the new Citation Blvd is going to be a big gain for the west side of town.  That road really ties together all the neighborhoods between Georgetown and Leestown Road so well.  It is easier to get in and out of that area too.  It nolonger feels like a bunch of random neighborhoods scattered across the west side of town.  Businesses are what the area needs.  I think values will really go up if the residents of those neighborhoods do not have to go to Hamburg or south Lexington for shopping/dinning/entertainment.  A nice big road like this might attract them.

 

This is an exciting time to be in real estate.  Things are changing so fast.  Prices are increasing in some areas, stable in others.  Tastes are shifting too.  It is a lot to keep up with…….every new business, every new road that opens changes how people feel about a location.

Low offers & a good market??

by John Rice

It’s a pretty hot market right now.  I’ve always said buyers come out sooner than sellers do….which is why I urge my sellers to put their houses on the market in February or early March.  This year, they are out sooner than normal.  That kind of happened in 2013 too, and that was an awesome year.

Main difference between Winter 2013 and Winter 2015 is that buyers are feeling a bit more confident.  Back in 2013, I’d put a listing on and it would very quickly get exceptional offers, some full asking price.  This year, I’m seeing more crazy low offers.  I’ve sold 4 houses in the past 22 days.  None of them got offers so good that the seller would just accept them.  Lots of back and forth.  They all ended up at the prices I told my sellers they would get, so the market has not gone down.  Could be all the new agents out there that don’t know what they are doing.  Could be that everybody knew prices were rebounding early in 2013 so it didn’t matter if you paid the full asking price.  Could be a little of both.

The worst one was a $40k difference between the offer and the $230k list price, which is a HUGE gap in our market.  I would have suggested we reject the offer had it not been contingent on the buyer closing on a property they had already sold.  I knew when I saw that contingency they were going to be homeless if they didn’t buy a house.

I got a low offer on a $125k list price. but we worked it out.  I had gotten a silly low offer on this house a couple of weeks ago.  As a strategy, we rejected their offer.  Rejecting an offer does one of two things:  It saves you the time and frustration of dealing with an unrealistic buyer, OR,  you turn the tables on them and put them on the defense.  Most of the time, a silly low offer ends up with the seller having little control over the negotiation process.  The buyer has seen everything else on the market and made an offer on your house.  They are telling you that they like your house the best.  If they are really going to buy something, it will be your place.  Why not use that to your benefit?

The other offer was a house that has been on the market a long time, which doesn’t happen to me often.  It had a few challenges.  One of those houses that always made a buyer’s short list, but was never at the top.  We got such a low offer that even I felt like they had slapped my face and said my mother was ugly.  The buyers felt worse.  We let them walk away.  I figured that IF those people were really going to buy a house, they would not be able to get another seller to practically give their house away.  It was best to wait.  Sometimes you have to let a buyer like that realize the market is different than they hoped it would be.  That’s why I like to part company on a happy note.  It makes it easier for them to come back later with a better offer……which happened this time.

The last deal was an offer I got while I was at the beach for a long weekend.  I told my client what the offer was.  I told him I thought he needed $1XX,XXX out of his house.  I thought the buyer was probably willing to go to $1XX,XXX.  We should counter $XXXX over what he wanted.  If they accept, great.  If they come back for more, we still that small amount of wiggle room to make the buyer feel like they won the war because they won the last battle.  20 minutes later we had a deal and I was walking out the back door towards the beach.

 

Winchester Road-Hottest Spot for New Luxury Homes

by John Rice

In the late 70’s, there was a huge demand for apartment complexes in Lexington.  At that same time, much of the land available for development was in the 40517 zip code.  That is why you see so many of them on Tates Creek Road outside Man O War and over towards Alumni Drive.

In the 80’s, interest rates went through the roof.  Our best example of what interest rates do to new construction can be found in Belleau Woods.  Every wondered why those larger houses you see from Wilson-Downing are nothing like the rest of the neighborhood?  That is because Belleau Woods was originally going to be an upscale neighborhood.  Those few houses you see from Wilson-Downing were built before the interest rates went sky high.  Once the rates rose, nobody could afford them.  Smaller homes became more popular to build.

A similar thing happen in The Home Place when the housing bubble burst.  In about 2008-2010, it was much safer to buy a smaller house, so that is what was build.  Now that the market is better, you are seeing much larger and fancier houses going up out there.

Summerfield?  That was originally going to be large luxury homes like Tuscany or West Wynd.  One of the smartest moves I’ve seen since I’ve been a realtor was turning that into medium sized upscale homes in the $250-300k range.  That was just what the market wanted.  Perfect timing.

So, here we are today.  The Dow is high, gas is cheap, jobs are being created, and Americans are no longer afraid to spend.  What is happening with new construction in Lexington?  A lot of luxury homes.  Tuscany is selling well after spending most of the past 6-8 years having been forgotten.  Jimmy Nash took a neighborhood full of large lots that nobody wanted and turned it into the hottest place to drop $750k or more on a house.

All of which brings me to where I am going with this.  The market is good, the economy is good.  The available land is out by Winchester Road.  That area is quickly becoming the high end spot to live, much like Tates Creek was in the 80’s and Harrodsburg Road was in the 90’s.

Why?  Because builders will build whatever the market demands on whatever land is available.