Looking into Louisville market

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Looking into Louisville market

Tim BergstromPro Member
Investor · Nashville, TN · Member since 2016 · 127 posts · 71 votes

Hey BP!

Given that I live in Nashville and am from Indianapolis I drive through Louisville every time I drive back and forth and for the last year or two have had my eye on it. I'm seriously considering trying to find something there, but need to build up my knowledge and contacts of reputable agents and contractors etc.

I'm interested in multi-family, STRs, commercial, self storage, and possibly even flips if the right opportunity came up. I know U of L is a solid area for rents because of the university. I've heard that Butchertown, Highlands, and Old Louisville are hotter areas and am guessing that proximity to Churchill Downs and downtown are usually a plus (especially for STRs).

I'm casting a wide net here in just doing some preliminary research to get a feel for different areas of town, but would love to get connected with some others who have had some experience doing some of these things and have a good lay of the land and are connected with reputable contractors. Any info would be helpful!  

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David AcostaPro Member
Wilmington, NC · Member since 2014 · 208 posts · 144 votes
6y

Hey @Tim Bergstrom, not sure if you've made any progress on this - we're operating in nearby Lexington and have vetted a few deals in the Louisville market.  I think you're on the right track in terms of it's proximity to other MSA's.  Cincinnati, Indianapolis, and Lexington are all with in a fairly close distance which could help with scale.  

I've found that Louisville offers some nice pockets.  We're in the larger multifamily space, but regardless location is pretty universal.  I'd keep an eye out for future development and path of progress plays.  As a due diligence footnote - a few submarkets are prone to severe flooding.

Nearby Frankfort (state capital) is seeing growth.  @James Wilcox is a really great resource in these areas as well. 

Best of luck!

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  • Kevin Allen
    Louisville, KY · Member since 2015 · 166 posts · 83 votes
    7y

    @Tim Bergstrom

    I live in Louisville. I’m not super experience but I do have a couple rentals. The area right around Churchill downs can be pretty rough. You can pick up houses cheap in the area but there is not a lot of appreciation. If I was going to buy in that area I would go closer to U of L.

    4Reply
  • Jacob Michal
    Flipper/Rehabber · Member since 2019 · 78 posts · 31 votes
    7y

    @Kevin Allen could do Airbnb’s by Churchill

    1Reply
  • Rob Bergeron
    Real Estate Agent · Louisville, KY · Member since 2017 · 1k+ posts · 1k+ votes
    7y

    We have an incredible market for most things. Not a lot of places to build, so everything seems to be appreciating well. It's great for cashflow and our entry level costs are lower than a lot of other markets. Low property taxes (1.1%) and not a lot natural disasters as well.

    6Reply
  • Raphael Collazo
    Real Estate Agent · Louisville, KY · Member since 2016 · 183 posts · 188 votes
    7y

    As far as commercial goes, we've been seeing a lot of activity in the multi-family and self-storage space. It seems like any time one of those asset classes becomes available, it doesn't stick around for very long. Along with that, there's been a solid amount of industrial activity, particularly near Riverport and the Bluegrass Commerce Park, due to a strong presence of manufacturing companies in Louisville. Definitely a good overall real estate market with solid upside potential.
     

    6Reply
  • Yonah WeissPro Member
    Cost Segregation Expert and Investor · Lakewood, NJ · Member since 2017 · 1k+ posts · 1k+ votes
    7y


    @Tim Bergstrom I have been eyeing the Louisville market as well, especially multifamily. It would be best to connnect with some brokers out there like @Tyler Chesser who are very active in the market. @Account Closed also invests in Louisville and is a wealth of knowledge.

    4Reply
  • Tim BergstromPro Member
    OP
    Investor · Nashville, TN · Member since 2016 · 127 posts · 71 votes
    7y

    Thanks everyone for your responses and feedback!

    0Reply
  • Waylen Herdman
    Franklin, TN · Member since 2017 · 31 posts · 7 votes
    7y

    @Tim Bergstrom

    I'm somewhat in the same boat. I live in Franklin but have been eyeing Louisville for a while. The difference is that I would want move there and house hack. I'm actually heading up there for a little impromptu vacation this weekend! Super excited to look around! I've also heard good things about Iroquois and Shawnee Park as the next up and coming areas from people on here and the Louisville subreddit but take that with a grain of salt.

    0Reply
  • Brian Stephens
    Lender · Louisville, KY · Member since 2019 · 24 posts · 30 votes
    7y

    @Tim Bergstrom I am a lender with a local bank here in Louisville and an investor personally as well.  Louisville is fantastic for cash flow and is a safe place to start since we don't typically get caught up in the roller coaster effect of steep appreciation followed by sudden pull backs when the market isn't red hot.  

    5Reply
  • Emily Fackler
    Rental Property Investor · Eddyville, KY · Member since 2019 · 33 posts · 19 votes
    7y

    I live in Louisville. My husband and I  just joined bigger pockets and I am excited to get started in real estate investing. I would love to partner with anyone, learn from anyone and do anything I can to provide value. Let me know if you need information about the areas of town or if you would like help walking properties, etc! 

    3Reply
  • Kevin Allen
    Louisville, KY · Member since 2015 · 166 posts · 83 votes
    7y

    @Emily Fackler you need to check out kreia. They have a monthly meet up. Also, I recommend Harry Borders as an attorney and for closings. He’s great and has always been happy to answer questions.

    3Reply
  • Emily Fackler
    Rental Property Investor · Eddyville, KY · Member since 2019 · 33 posts · 19 votes
    7y

    I will! Thx!! 

    0Reply
  • Tyrell D Bradshaw
    Member since 2019 · 38 posts · 11 votes
    7y

    How are the surrounding areas outside of Louisville? Shelbyville etc?

    2Reply
  • Emily Fackler
    Rental Property Investor · Eddyville, KY · Member since 2019 · 33 posts · 19 votes
    7y

    Oldham county is very popular due to the amazing school district! Pee wee valley, Crestwood, LaGrange. 

    1Reply
  • Tyrell D Bradshaw
    Member since 2019 · 38 posts · 11 votes
    7y

    @Emily Fackler I figured those areas would be great at the moment. It's kind of the same here in Lexington too. The market here is competitive so people are looking into the Georgetown, Winchester areas.  

    1Reply
  • Brad Noe
    Real Estate Agent · Louisville, KY · Member since 2016 · 146 posts · 135 votes
    7y

    @Tim Bergstrom you correctly pointed out some of the hotter areas of town. My wife @Katie Noe and I flip houses and also do some long term rentals here in Louisville and in Southern Indiana. For flips, we try to stay in the $130-200k ARV range. For rentals, we are looking for a good balance of mild cashflow and appreciation in B and C class neighborhoods.

    In general, in Louisville we like to operate inside of interstate 265 and east of I-65. In southern Indiana (which we are mostly targeting for rentals) we like New Albany and Jeffersonville, although Charlestown is also booming right now.

    4Reply
  • David AcostaPro Member
    Wilmington, NC · Member since 2014 · 208 posts · 144 votes
    6y

    Hey @Tim Bergstrom, not sure if you've made any progress on this - we're operating in nearby Lexington and have vetted a few deals in the Louisville market.  I think you're on the right track in terms of it's proximity to other MSA's.  Cincinnati, Indianapolis, and Lexington are all with in a fairly close distance which could help with scale.  

    I've found that Louisville offers some nice pockets.  We're in the larger multifamily space, but regardless location is pretty universal.  I'd keep an eye out for future development and path of progress plays.  As a due diligence footnote - a few submarkets are prone to severe flooding.

    Nearby Frankfort (state capital) is seeing growth.  @James Wilcox is a really great resource in these areas as well. 

    Best of luck!

    6Reply
  • James WilcoxBusiness Member
    Real Estate Agent · Bowling Green KY ~ Lexington, KY · Member since 2015 · 1k+ posts · 602 votes
    6y

    @David Acosta thanks man! @Tim Bergstrom sounds like you are well on the right track. I second a lot of what has been stated by others in this forum. L-ville has it's pockets so you really need to know that market well. Westside can be rough especially for a first-time investor. I would recommend sticking to the areas others have stated in general. 

    Also, if you wish to focus more on the central KY areas I am your guy. I would love to show you what those markets have to offer compared to L-ville. Just shoot me a DM.

    REI James w/ eXp Realty54 Reviews
    WebsiteView Page
    2Reply
  • John Sherwood
    Investor · Oakland, CA · Member since 2019 · 22 posts · 11 votes
    6y

    Thanks for starting this thread @Tim Bergstrom. I’m also interested in the Louisville market - given the SF Bay Area (where I live) is too pricey for a newbie like me to start off in - and I travel to Louisville several times a year for work. So I’m familiar with it at a high level - so I’m also looking for connections/feedback to help understand the nuances, etc. for my first investment in the market. I am attracted to areas like Old Louisville, Frankfurt, Butchertown, Highlands, etc. - but seems like there may be some up and coming areas that I’m completely overlooking. 

    0Reply
  • Erik HitzelbergerPro Member
    Investor · Louisville, KY · Member since 2011 · 331 posts · 278 votes
    6y

    @John Sherwood The areas you mentioned are certainly high-demand areas, but they come with challenges. Competition with owner-occupants and the age of the homes (70-120+) will squeeze your margins and expose you to a fair amount of risk. It can certainly be done, but I'd recommend having a solid contractor on your team and holding a fair amount in reserves. 

    1Reply
  • John Sherwood
    Investor · Oakland, CA · Member since 2019 · 22 posts · 11 votes
    6y

    Thanks @Erik Hitzelberger , exactly. I would hope there are some other less obvious or “cool” areas that provide better financials (rather than appealing to my emotional - “I love those neighborhoods”). I also want to avoid the trap of thinking that things are a good deal because I’m comparing to the Bay Area (which makes nearly everything a good deal) ;-)

    0Reply
  • Joe Worth
    Investor · Louisville, KY · Member since 2019 · 12 posts · 6 votes
    6y

    @John Sherwood You should look into the Shelby Park and Smoketown neighborhoods. Shelby Park is getting a facelift from many investors (myself included) and Smoketown is the next neighborhood in line if you're looking for an affordable price point with future growth.

    2Reply
  • John Sherwood
    Investor · Oakland, CA · Member since 2019 · 22 posts · 11 votes
    6y

    Cool, thanks @Joe Worth - had been poking around at both of those - so glad to hear there's potential. What do people think about Algonquin? Seems to be sort of industrial, but near the University...  but wondering if that's getting too close to the West side? 

    1Reply
  • Joe Worth
    Investor · Louisville, KY · Member since 2019 · 12 posts · 6 votes
    6y

    @John Sherwood Depending on the demographic of tenants you're okay with renting to it's a decent area for rentals. Students won't rent in the Algonquin area. And I personally wouldn't flip a house over there unless I got it dirt cheap. But everybody has a different risk tolerance level.

    0Reply
  • John Sherwood
    Investor · Oakland, CA · Member since 2019 · 22 posts · 11 votes
    6y

    @Joe Worth thank you!

    0Reply
  • Shaan Puri
    Member since 2023 · 27 posts · 15 votes
    2y

    Reviving this thread, as I am started to eye Louisville as well given the lower barrier to entry. 

    I will be out of state and open to both LTR and STR.

    How is the area around Churchill Downs these days? I am seeing a lot of AirBnBs already with high ratings for location 

    1Reply
    • Justin Crosby
      Louisville, KY · Member since 2018 · 10 posts · 3 votes
      1y

      @Shaan Puri I don't know if anyone has responded or if you're still interested but I have relevant recent experience down by Churchill Downs and willingness to share freely! Just direct message me and I'll share my thoughts for what their worth!

      0Reply
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