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The State of the Housing Market in the Greater Louisville Area

Louisville Housing Market - 2013. The State of the Housing Market in the Greater Louisville Area. By: Jose M. Fernandez Assistant Professor of Economics University of Louisville. The Recession of 2007 - 2009. Louisville Housing Market – 2013 Recent Past, Present, and Future.

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The State of the Housing Market in the Greater Louisville Area

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  1. Louisville Housing Market - 2013 The State of the Housing Market in the Greater Louisville Area By: Jose M. Fernandez Assistant Professor of Economics University of Louisville

  2. The Recession of 2007 - 2009 Louisville Housing Market – 2013 Recent Past, Present, and Future

  3. Employment and Unemployment Louisville Housing Market – 2013 Recent Past, Present, and Future June - 2007 606,325 Jobs Jobs Recovered 45,144 Feb. - 2010 547,802 Jobs

  4. Employment and Unemployment Louisville Housing Market – 2013 Recent Past, Present, and Future Feb 2010 Unemployment Rate, 12.3% 7.9% Nov. 2007 Unemployment Rate, 4.6%

  5. Changes in Louisville employment during 2012, via Brookings Institution Metro Monitor

  6. Jobless Recovery? Louisville Housing Market – 2013 Recent Past, Present, and Future

  7. Historically Low Interest Rates Louisville Housing Market – 2013 Recent Past, Present, and Future

  8. Historically Low Interest Rates Louisville Housing Market – 2013 Recent Past, Present, and Future

  9. Historically Low Interest Rates Louisville Housing Market – 2013 Recent Past, Present, and Future

  10. Recovery Louisville Housing Market – 2013 Recent Past, Present, and Future

  11. Policies that fueled the buying Louisville Housing Market – 2013 Recent Past, Present, and Future

  12. Present Louisville Housing Market – 2013 Recent Past, Present, and Future

  13. Present Louisville Housing Market – 2013 Recent Past, Present, and Future

  14. Slow Price Recovery Louisville Housing Market – 2013 Recent Past, Present, and Future

  15. Slow Price Recovery Louisville Housing Market – 2013 Recent Past, Present, and Future

  16. Price and Quantity Louisville Housing Market – 2013 Recent Past, Present, and Future

  17. Mortgage Loan Origination in Southern Region of US Louisville Housing Market – 2013 Recent Past, Present, and Future

  18. Mortgage Loan Origination in Southern Region of US Louisville Housing Market – 2013 Recent Past, Present, and Future

  19. Louisville Housing Market – 2013 Recent Past, Present, and Future

  20. Louisville Housing Market – 2013 Recent Past, Present, and Future

  21. Louisville Housing Market – 2013 Recent Past, Present, and Future

  22. Year-to-Year change by County within Louisville MSA Louisville Housing Market – 2013 Recent Past, Present, and Future

  23. Year-to-Year change by County within Louisville MSA Louisville Housing Market – 2013 Recent Past, Present, and Future

  24. Percent. Foreclosures by Geographic Location Louisville Housing Market – 2013 Foreclosures

  25. Louisville Housing Market – 2013 Foreclosures

  26. Median Sale Prices: Typical vs. Foreclosure Louisville MSA Louisville Housing Market – 2013 Foreclosures

  27. By Zip Code in Louisville MSA Louisville Housing Market – 2013 Foreclosures

  28. Future: Interest Rates and Recovery Louisville Housing Market – 2013 Recent Past, Present, and Future

  29. Future: Interest Rates and Recovery Louisville Housing Market – 2013 Recent Past, Present, and Future

  30. Future: Interest Rates and Recovery What to look out for? Inflationary concerns (currently low, but keep an eye on the price of gold) The Law of Money MV = PY M = Money Supply P = Price Level V = Velocity of Money Y = Real GDP Student Loan Defaults Good Job Reports Louisville Housing Market – 2013 Recent Past, Present, and Future

  31. The Persistence of Financial Illiteracy Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After 5 years, how much do you think you would have in the account if you left the money to grow? a. More than $102 b. Exactly $102 c. Less than $102 d. Do not know * Fewer than 1/3 of young adults in the US answered this question correctly! Louisville Housing Market – 2013 Recent Past, Present, and Future

  32. The Persistence of Financial Illiteracy AnnamariaLusardi (Dartmouth) studies financial literacy The Wall Street Journal summarizes: In fact, Americans’ grasp of concepts such as investment risk and inflation has weakened since the recovery began in mid-2009. Research released last week shows that on a five-question test (take the test here), respondents did worse in 2012 than in 2009. The average number of correct answers fell to 2.9 in 2012 from 3.0 on the test in 2009. Louisville Housing Market – 2013 Recent Past, Present, and Future

  33. The Persistence of Financial Illiteracy AnnamariaLusardi (Dartmouth) studies financial literacy Nearly 50% of observed income differences are due to financial illiteracy These “optimally ignorant” individuals include 67% of the dropouts, 47% of the high school graduates, and 33% of college graduates. The majority of Americans do not plan for predictable events such as retirement or children’s college education. Most importantly, people do not make provisions for unexpected events and emergencies, leaving themselves and the economy exposed to shocks. Louisville Housing Market – 2013 Recent Past, Present, and Future

  34. Conclusion Recovery Financial Recovery – accomplished Employment Recovery – SLOW Expect interest rates to rise, but stay remain low Expect housing purchase to even out and prices to rise at decreasing rate Outlook is positive, but growth will not be strong. Expect continued re-finance applications Future Watch out for inflation Help make consumers more financially literate Louisville Housing Market – 2013 Recent Past, Present, and Future

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