LEXINGTON, Ky. (LEX 18) — Interest rates are up, and so are home prices, but there's a corner of the housing market that first-time buyers may want to pay attention to. While it's more of a difficult time for sellers, some realtors say that it could be a good time to buy.
Hannah and Nick Garnett moved into their first new home in June. Hannah showed her real estate agent, Christina Dudek, how much renovation progress they've made.
Hannah tells Christina, "For you all to see the potential, like what it's turned into is really cool because we didn't even have that vision when we walked into this space."
Hannah and Nick have made the home their own. Christina is an associate broker with Coldwell Banker McMahan. She explains that now is the time to consider buying. While higher interest rates have taken a slight dip. She says, "It has gotten a little harder for sellers just because of the interest rates -- they're not selling so quickly, there aren't as many multiple offers. So, it's giving some of these buyers the opportunity to get their foot in the door."
Bluegrass Realtors data shows that homes have been up in recent years. By the end of 2023, Fayette County's median home price was $315,000. By the end of July 2024, it jumped to $335,000. About a decade ago, it was only $159,000.
Christina explains buying can be easier as rent rises. She says, "We are a town that has a college, so rents are just crazy. When you have four of five people renting a home, they’re able to split the cost and those higher rents just keeping going higher and higher and higher which is actually making families and couples, you know it makes it harder for them to rent because now they're competing with college students and things like that."
Before their big move, Hannah and Nick were renters. Prices are on the rise in Lexington. Zillow estimates the median rent is $1,650, up $150 from this time last year.
Hannah says they had flexibility with interest rates being where they are now. “Yea, so for us we knew if we got into competing wars with contracts, we couldn’t hold up as first-time home buyers... We were at a place where we were able to even kind of negotiate some of the closing costs into our contract, which that's not something you can do when the interest rates are low because you've just got to get into the home,” says Hannah.
Hannah says they wanted to build something for themselves. "The investment is so powerful because we could even choose to keep this property and use it as a rental property down the road or we could sell it but all of that money we're paying month in, month out is building the equity that's gonna help us in the future."
