Finally we have really good news for the farm market in the Bluegrass- yeah!  

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2011 saw an increase in the sales volume of farms in Fayette and the immediate surrounding counties of 24.7% from a sales volume of $65,136,546 in 2010 to $81,198,689 in 2011.   For farms that are 10 acres or  more the average selling price increased 10% from $543,808 to $597,668.  The sales numbers for November and December 2011 are even better.  Sales for Fayette and the immediate surrounding counties increased 26.8% in November and December 2011 over November and December 2010.  This was the best November and December for farm sales since 2004! 

The residential market for Lexington and the immediate surrounding counties is also seeing strength.  Third quarter sales are up 10% from 2010 to 2011.  The three best underlying measures of housing stability and future growth for an area are employment, the health of the rental market, and the foreclosure rate.  Lexington's January 2012 unemployment rate is down to 6.5%.  The rental market continues to be tight especially on homes with values over $300,000 and farms that are horse improved with houses on them.  The foreclosure rate has also dropped.  No official statistics have been released for 2011.  I only saw 5 farms go through the master commissioners sale and all but one were bought back by the perspective lending institutions.  3 of those farms were horse improved- 11 acres for $275,000 and later sold by the bank to a private party, 44 acres for $905,000 to a private party, and 241 acres that sold for $3,000,000 and was bought back by the bank.

   

Most of the figures you look at make it appear as if the local real estate market has hit bottom and may be attempting to gain strength.  From a more anecdotal stand point, sellers have finally begun (and only just begun) to realize that prices have dropped 20% or more in some cases.  As the last hold outs drop their prices the sales volume increases and we finally get a real idea of what prices the buyers will bear in the current market.  It seems if most of the really great buys on paper are finally selling.  Although I certainly do not have a crystal ball, I think now is a great time to buy and particularly if you are not a cash buyer.  There is greater risks of higher interest rates, even if minimal, than there are of falling farm values.  Cash buyers will be less affected by interest rates so you have less risks in waiting to see how strong the market continues to grow.

Hill Parker, Broker 859-608-8039

Click Here To View Bluegrass Farms 

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