This is what Caleb does. He blithely mentions some question that should be answered, knowing it will tempt me into researching it and posting the conclusions. He’ll ask something like “I wonder if there are more stolen bases now, or in past years of baseball?”

This time he asks:

Is the lack of foreclosures in Kentucky a good indicator of Kentucky’s economic outlook? Is the stability in Kentucky’s housing market an indicator of strength or stagnation?

According to the National Association of Realtors, Kentucky’s rate of sales in existing homes dropped 14.2 percent between the fourth quarter of 2006 and 2007. This is a relatively small drop, far below the national average of 20.9 percent and below the drop for any region of the country as well.

In addition the prices for existing homes dropped only 2.3 and 3.3 percent in Lexington and Louisville respectively, compared with a 5.8 percent drop nationally. Memphis, a city often compared to Louisville in demographics, saw a drop of 12.4 percent.

This would seem to indicate that Kentucky is largely being spared the worst part of the housing downturn. This is a common pattern for Kentucky’s economy though. We are less susceptible to price bubble collapses, because we are less likely to get the benefits of the bubble in the first place. Kentucky was largely spared the worst of the dot-com bubble collapse because we simply don’t have many high tech industries.

In this case we have again been spared part of the downturn, because we shared to a smaller extent in the upswing.