Bowling Green, the second most populous city in the state of Kentucky behind Louisville, has made up a lot of ground since the recession. What looked to be a rough road ahead for the city just a few short years ago has turned into a rather prosperous period. Home prices for the Bowling Green real estate market have appreciated at an impressive rate and are currently outpacing the national average. When all is said and done, Bowling Green has taken the recovery and run with it.
The current median home price in the Bowling Green real estate market is $140,000. Bowling Green housing prices are above historical averages, but they are significantly behind the rest of the country. With the direction things are heading, however, that may not be the case for much longer. The Bowling Green real estate market has become the beneficiary of some impressive appreciation rates over the last 12 months. That said, homes in the city have appreciated by as much as 14.8 percent in the last year. While slightly below the three-year average of 18.6 percent, the same holds true for markets across the United States. At its current rate, Bowling Green’s appreciation is more than twice the national average (6.7%). Prices are expected to grow relative to last year.
At the moment, Bowling Green is a soft seller’s market. Property is in demand because of a distinct lack of inventory. There are essentially more potential buyers than sellers. Bidding wars with other buyers are becoming more likely with the way things are going, and listings have started to sell for more than the asking price.
The rental market, on the other hand, is a little more competitive. Bowling Green real estate investing could see a lot of activity within the buy-and-hold sector. Rental property is in high demand and availability is low. Rent prices have increased by five percent over the past three months. This is five percent higher than the county average of $1,104 and three percent lower than the state average of $1,187.
The following highlights how much equity has been gained in the Bowling Green real estate market relative to the year of the home’s purchase:
- Homes purchased in the Bowling Green housing market one year ago have appreciated, on average, by $27,044. The national average was $15,753 over the same period.
- Homes purchased in the Bowling Green housing market three years ago have appreciated, on average, by $35,186. The national average was $53,565 over the same period.
- Homes purchased in the Bowling Green housing market five years ago have appreciated, on average, by $41,737. The national average was $47,444 over the same period.
Over a three-year period, both price appreciation and principle payments have served to increase equity across the board. Homeowners, as a result, have demonstrated more confidence.
Of course, as with any hot real estate market, Bowling Green is supported by an equally impressive economy. Experts are confident in the direction things are heading, and employment numbers look as if they will continue to push local supply and demand. The city’s most impressive economic indictor is perhaps its rate of unemployment. Now at 4.9 percent, Bowling Green’s unemployment rate is below the national average and more than two percent better than it was last year at this point. Unemployment in Bowling Green, for what it is worth, is relatively stronger than most other markets across the country. Not only that, but it is continuing to improve. Look no further than the city’s job growth rate for your proof. In the last year, Bowling Green’s job growth rate reached 2.7 percent, well above the national average of 2.1 percent. The entire Kentucky economy, for that matter, has outpaced the rest of the country.
With the expansion of Bowling Green’s economy, the city has been able to add new housing at an above average clip. The current level of construction is now 9.9 percent above the city’s long-term average. Single-family housing permits alone have jumped 15.1 percent in the last year, whereas the national average saw a modest increase of 3.1 percent. There is little to suggest this trend won’t continue, as local inventory appears to have stabilized.
If that wasn’t enough, the Bowling Green real estate market has one indicator really working in its favor: affordability. Accordingly, Bowling Green real estate is more affordable than most markets across the country. Homeowners in the city can expect to spend approximately 8.8 percent of their income on monthly mortgage obligations, whereas the national average is just over 14 percent. Experts expect affordability in Bowling Green to improve through the end of the year.
Affordability in the Bowling Green housing market has had a positive impact on the area’s foreclosure rate. According to RealtyTrac, there are only about 11 homes in some state of foreclosure within the Bowling Green city limits. Just over halfway through the year, foreclosure rates are 27 percent lower than 12 months ago. These homes are either at risk of defaulting, bank-owned, or going to be sold at auction. Either way, they should provide Bowling Green real estate investing with some promising activity.
The state of Kentucky has come a long way since the recession, and Bowling Green is no exception. The local economy appears ready to sustain a growing housing market. As a result, Bowling Green real estate investing should see an increase in activity.
Bowling Green Real Estate Market Summary:
- Current Median Home Price: $140,000
- 1-Year Appreciation Rate: 14.8%
- Unemployment Rate: 4.9%
- 1-Year Job Growth Rate: 2.7%
- Population: 56,407
- Median Household Income: $33,362