As early November approaches, there's a question I often receive: "How was the Lexington market in October? Should I buy now, or should I wait and rent for another year?" Today, I will break down this question step by step with numbers.

First, let's clarify the reference point. Sales statistics are released by Bluegrass Realtors around the third week of each month, so the most recent sales data available now in early November is from September.

The sales figures for October have not yet been released. Therefore, I will use the September data for sales and interpret the October trends through rental indicators and mortgage rates.

Let's start with the most pressing question about Lexington, specifically Fayette County home prices. The median home price for Fayette County in September was $360,000.

This is up from $342,500 in the same month last year, representing a 5% increase. I must admit, I was a bit surprised that prices have held steady despite such high interest rates.

On the other hand, the number of transactions has decreased. There were 301 transactions in Fayette County in September, which is 4% lower than the 314 transactions in September of last year.

Looking at just one month can create a misleading impression, so I also checked the cumulative data from the beginning of the year through September. The cumulative median price is $355,000, which is 4% higher than the $340,000 from the same period last year.

The cumulative number of transactions is 2,963, which is a 4% increase from last year's 2,843. Overall, it's hard to say that the Lexington market has cooled down this year.

There is a point that many people find confusing. The median price of $290,000 reported in the news is not specific to Lexington.

That figure represents the overall statistics for 38 counties covered by Bluegrass Realtors. The median price for the entire region in September was $290,000, which is a 1% increase from last year, with 1,223 transactions, a 2% increase.

If you are looking for a home in Lexington, you should base your decisions on the Fayette County numbers rather than the overall regional figures, as there is a $70,000 difference between the two.

The next question is usually, "Have listings increased?" This is based on the overall region, and at the end of September, inventory was at 4,773 homes, which is 11% more than last year's 4,283 homes.

It has been reported that the inventory has been higher than last year for 35 consecutive months. The absorption rate has also lengthened from 3.6 months to 3.9 months.

The speed at which homes are selling has slowed down. Again, based on the overall region, the median days on market for homes that were listed and sold was 24 days, which is 5 days longer than last September's 19 days.

The number of pending contracts, which indicates future transactions, is 1,097, down 4% from last year and down 17% from August. I interpret this as a signal that October transactions may slow down a bit.

The background of this trend is the interest rates. According to Freddie Mac, the average 30-year fixed mortgage rate was 7.40% for the week of October 15 and 7.32% for the week of October 22.

The average for the month of September was 6.86%, so it has definitely risen a notch in October. The Mortgage Bankers Association (MBA) also projected an average of 7.3% for the fourth quarter.

Let's put this into perspective with numbers. If you buy a $360,000 home with a 20% down payment and borrow $288,000 at 7.32% for 30 years, your principal and interest payments would be about $1,978 per month.

Property taxes and homeowners insurance are additional costs. Since these can vary significantly by property, I recommend obtaining the tax records and insurance estimates for the specific address before making a contract.

Now, let's look at the rental side. According to Apartment List's November report, the overall median rent in Lexington is $1,211.

This is a 1.2% decrease over the month of October. As the weather gets colder, the demand for moving typically decreases, so I view this decline as a significant seasonal adjustment.

Compared to last year, this is a 2.2% increase, which is higher than the Kentucky state average of 1.1% and the national average of 0.1%.

The median rents by bedroom count are $983 for one-bedroom and $1,207 for two-bedroom units. Compared to the national median of $1,369 for two-bedroom units, this is still relatively affordable.

Returning to the initial question, if we compare the two-bedroom rent of $1,207 with the monthly payment of $1,978 for purchasing, it's clear that renting is currently the lighter option.

However, purchasing builds equity, while renting can increase annually, so both factors need to be considered. Ultimately, how many years you plan to live there is the biggest variable.

If I were currently looking for a home, I would approach it this way. Given that inventory is increasing and the selling period is lengthening, I would negotiate more actively on price and closing cost assistance.

If you're not in a hurry, it might not be a bad idea to wait and see how the winter off-season plays out. If interest rates drop, you could consider refinancing then, but keep in mind that no one can guarantee when that will happen.

The October sales statistics will be available around the third week of November on the Bluegrass Realtors website in their monthly report, broken down by county. Once the numbers are out, I will revisit whether this forecast was accurate.