Lexington, KY Housing Market Report

The Lexington-Fayette housing market is currently transitioning into a more balanced state, though it remains slightly tilted in favor of sellers due to consistent price appreciation. As of December 2025, the median home value reached $318,873, marking a 4.11% increase over the previous year. While prices are rising, the most significant shift is found in inventory levels, which have surged by 36.28% year-over-year to 1,574 active listings. This influx of supply is providing buyers with more options than they have seen in recent years, effectively slowing the pace of the market.

Price trends over the last six months show a steady upward trajectory, climbing from $312,671 in July to the current December peak. This incremental growth suggests a stable demand for housing in the Bluegrass region, likely bolstered by the area's diverse economy and the continued appeal of the University of Kentucky. However, the average time a property spends on the market has increased to 56 days, an eight-day jump from last year. This indicates that buyers are becoming more selective and are no longer rushing into offers, a sentiment further supported by a sale-to-list ratio of 0.98, showing that most homes are selling slightly below their initial asking price.

Looking ahead, the Lexington market appears poised for a period of moderate growth rather than volatile swings. For sellers, the increase in days on market means that pricing strategy and home condition are more critical than ever; the days of immediate bidding wars have largely been replaced by a more traditional negotiation process. For buyers, the combination of rising inventory and a rental market that is appreciating faster than home values (5.25% YoY) makes a compelling case for homeownership. As long as inventory continues to climb, buyers will maintain improved leverage to negotiate repairs or price concessions.