Sunday, July 29, 2012

Appraising High End Homes in Hardin County

Almost everyone enjoys looking at high end properties.  It’s fun to see what could be if money were not an issue.  I enjoy looking at the way high end homes are constructed because builders can do some pretty unique things when they are dealing with a large budget.  So you would think that when I get an appraisal assignment for high end property in Hardin County I would be looking forward to it. Well, not really.

Over the past several years everyone has heard about the recession.  Hardin County has seen the effects also, but not as much as some parts of the country.  One of the unfortunate casualties of the recession is the high end home market.  Let’s face it, when times are tough less money is spent on luxury items such as trophy homes.  Let me define high end for the sake of this article, and don’t scoff if your definition of high end differs from mine, it’s for the sake of the data. We’ll be looking at 3000+ Sqft homes over $500,000 from the HKAR MLS. 

Since 2005, the high end market in Hardin Co. has seen depreciation of 2.2% each year, with a median sale price of $651,274.  There were no million dollar sales, and the bulk of these properties were located around the Elizabethtown area.  So each time I see a million dollar property listed I say to myself: really? 

I mentioned earlier that I usually don’t look forward to high end appraisals in Hardin County.  The reason why is because most of the time I can see red flags as soon as I see any sale history in the past 7 years.  The recent sale means that it is probably not worth now what it was when it last sold based off the depreciation we’ve seen in recent years.  The bad news is I can’t say if we will start to see appreciation in this market.  Let me explain.
In terms of Real Estate, 2010 was a huge year for Hardin County.  We saw a large influx of new families from BRAC, and the moderate housing market jumped significantly for the back half of 2010 and the beginning of 2011.  Even during this time of increase, the high end market decreased.  I believe it was due to the people in this buyer pool going to Jefferson County instead of Hardin County.  What will it take to see the high end market recover?  In my opinion, local attractions and high paying jobs are the answer.  People go to live in Louisville because of the shopping, dining, sports, and attractions.  What does Hardin County have?  There has been talk of the cities in Hardin County combining into a metropolis, which would rival Louisville and Lexington.  Could this be the answer?  Only time will tell.

All that aside, trophy homes are cool.  Every one I've been in has had something that made me say “wow”.  But Hardin County's high end market is not doing well.  We will have to wait and see if this becomes a thriving market in the near future. 

Bluegrass Valuation Services provides appraisal services for lenders, home owners, and Realtors.  Please visit our Facebook page and click the like button in addition to recommending our services to your family and friends.   


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