Bowling Green and Warren County are among the state’s top areas for a healthy housing market and where people can save the most money from refinancing their mortgage.
Recent studies by SmartAsset – a data-gathering website for financial topics – compiled the county rankings across the U.S. where people are saving the most from refinancing and cities with the healthiest housing markets. The studies also broke the information down by states. In Kentucky, Warren County ranked seventh in total refinance savings. Bowling Green ranked 10th in healthiest housing markets.
Craig Browning, regional president of U.S. Bank, said the area has been fortunate in that it wasn’t hit as hard during the economic recession as other cities and counties in the state, making recovery easier and allowing Bowling Green and Warren County to surpass other Kentucky communities.
“The housing market is a direct reflection of what’s going on in the local economy,” Browning said. “To me, these rankings show how well Bowling Green is doing compared to other parts of the state.”
Bowling Green landed in the top 10 healthiest housing markets in Kentucky with a 55.9 on the healthiest market index, of which affordability accounted for 40 percent while fluidity, stability and risk of loss accounted for 20 percent each.
The average time of living in a home in Bowling Green is 14.6 years, according to SmartAsset’s Mortgage Calculator. The average of homes with negative equity is 11.7 percent. A home in Bowling Green spends an average of 170.7 days on the market.
Bowling Green ranked 645 nationally in housing markets. Warren County as a whole ranked 990 nationally in housing markets, with 13.4 years spent in a home, an average of homes with negative equity at 11.4 percent, 3.4 percent of homes sold at a loss and 235 days on the market.
Bowling Green ranked second in the risk category of the healthiest housing markets study, with 4.1 percent of homes sold at a loss. Madisonville was the only city that had a better risk percentage at 3.6 percent. The risk ranking was based on the percentage of homes sold at a loss. Bowling Green ranked 59th nationally in the risk category. Warren County ranked seventh nationally in the same category.
The involvement of the Bowling Green Area Chamber of Commerce and the Economic Development Authority has spurred job creation and company expansion, which has contributed to the region’s economic health, Browning said. He added that having active Builders and Realtor associations have benefited the housing market.
“We have something very special in the Bowling Green area. ... The entire 10-county area benefits from the regional approach to economic development,” Browning said.
Kim Phelps, communications and public policy director for the chamber, said 2014 was a record-breaking year, with $211 million in investment and 660 new jobs. Phelps also cited a study by the Kentucky Chamber that showed the Bowling Green-Hopkinsville region led the state in job growth last year, surpassing the national average.
“All those things come together and boost the entire economy,” Phelps said.
Warren County saw 1,740 loans refinanced in 2013, according to SmartAsset’s Refinance Calculator. The average refinance amount was $158,005. The annual savings per loan was $3,004 – earning the county a rank of ninth in the state. Annual county savings were $5.2 million. Warren County ranked 532 in the nation.
SmartAsset looked at data on pre- and post-refinance interest rates and the total balance of refinanced mortgages in every county, according to smartasset.com. The website applied the national average pre-refinance interest rate of 5.88 percent and the national average post-refinance rate of 3.98 percent to the total balance of refinanced loans in every U.S. county. That gave the expected total interest payments with – and without – refinancing. The difference between those two numbers yielded the total refinance savings by county. The site also divided the total savings by the number of loans per county to produce the average savings per refinance.
Browning emphasized that refinancing as soon as possible can be advantageous to homeowners – maybe in thousands of dollars.
“Anyone that hasn’t reviewed their mortgage interest rate in the last three years needs to do so while we still have historically low interest rates,” Browning said. “If (homeowners) haven’t refinanced in the last three years, there are chances they’re paying above the market rate. ... It’s important for them to know their current mortgage interest rate so they’re not leaving dollars on the table.”
Browning cautioned that rates are projected to start climbing this year, so homeowners should follow up with their lender and shop rates to make sure they’re not missing out on a large amount of money.
— Follow business beat reporter Monica Spees on Twitter at twitter.com/BGDNbusiness