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Zip Code 40517

Lexington, KY • Fayette County

Real Estate Market Analysis

Q3 2025 Report
$251,704 (up 4.1% YoY as of early 2025)
Median Home Value
Approx. 28,000–30,000 (2024 estimate)
Population
$48,000–$52,000 (below Lexington median)
Median Income
Above average (statewide)
School District Rating

Market Statistics

Property Values

$251,704 (up 4.1% YoY as of early 2025)
Median Home Value
Estimated $1,300–$1,500/month (Lexington average)
Median Rent
Approx. $170–$185
Price per Sq Ft

Market Performance

Home Appreciation4.1% YoY (40517); Lexington overall 5.4% YoY[4][3]
Market VelocityMedian 24 days to pending (Lexington overall)[3]
Foreclosure RateLow; no significant spike reported

Area Information

Area SizeApprox. 7.5 sq mi
CountyFayette
Primary CityLexington

Housing Profile

Housing Statistics

Total Housing UnitsApprox. 10,000–11,000 (estimate based on area size and density)
Owner OccupiedAbout 45–50% (Lexington average)
Rental PropertiesAbout 50–55% (Lexington average, higher in 40517 due to student/young professional population)
Vacant Units5–7% (Lexington average)
New ConstructionLimited; most housing stock built 1970s–2000s, some infill and townhome projects

Housing Types

Single-family homesTownhomesApartmentsCondos

Demographics

Approx. 28,000–30,000 (2024 estimate)
Population
32–34 (younger than Lexington average)
Median Age
$48,000–$52,000 (below Lexington median)
Median Income
Approx. 95% (Lexington metro)
Employment Rate
High school grad or higher: 90%+; Bachelor’s or higher: 35–40%
Education Levels
Mix of singles, young families, students, and retirees
Family Composition

Education Quality

School District Performance

Above average (statewide)
District Rating
School DistrictFayette County Public Schools
Test ScoresSlightly above state average; varies by school
Graduation RatesHigh (Lexington average 90%+)

Schools in Area

  • Tates Creek High School
  • Tates Creek Middle School
  • Breckinridge Elementary
  • Private and magnet options nearby

Economic Factors

Employment & Business

Job GrowthSteady, 1–2% annual growth (Lexington metro)
Unemployment Rate~3.5% (2025, Lexington metro)
Business EnvironmentDiverse, strong healthcare, education, logistics, and tech sectors
Commercial ActivityModerate; retail, dining, and service businesses along main corridors

Major Employers

  • University of Kentucky
  • Baptist Health Lexington
  • Lexmark
  • Fayette County Public Schools
  • Amazon

Infrastructure & Quality of Life

Infrastructure

Transportation Access

  • • New Circle Road (KY-4)
  • • Man o’ War Blvd
  • • Lextran bus service

Utilities & Services

  • • Kentucky Utilities (electric)
  • • Kentucky American Water
  • • City sewer/trash

Quality of Life

Safety & Environment

Moderate; property crime slightly above Lexington average, violent crime below average

Good; suburban, tree-lined streets, moderate traffic

Healthcare Access

  • • Baptist Health Lexington
  • • UK HealthCare clinics

Development Trends

Planned Developments

  • Small-scale infill housing
  • Townhome and apartment renovations

Infrastructure Projects

  • • Road resurfacing, sidewalk improvements

Investment Outlook

Growth Outlook

Stable, moderate growth; limited land for major new subdivisions

Investment Opportunities

  • • Value-add multifamily
  • • Affordable single-family flips
  • • Student/young professional rentals

Marketing Intelligence

Target Demographics

  • First-time buyers
  • Young professionals
  • Investors
  • Downsizers

Competitive Advantages

  • Lower price point than 40502/40503
  • Strong rental demand
  • Quick access to major employers

Pricing Strategies

List slightly below Lexington median to attract value-focused buyers

Common Objections & Response Strategies

Objection: Older housing stock, some homes need updates

Response Strategy:

Highlight renovated properties and lower entry price; suggest renovation loans

Objection: Higher property crime rates in some pockets

Response Strategy:

Provide crime data, emphasize neighborhood watch and community policing

Objection: School ratings not as high as some other Lexington areas

Response Strategy:

Point to above-average district, specific high-performing schools, and extracurriculars

Professional Recommendations

1

Target digital marketing to young professionals and first-time buyers

2

Highlight affordability and rental potential in listing materials

3

Network with local employers and relocation services

4

Educate buyers on renovation loan options and value-add potential

5

Monitor zoning and development for new investment opportunities

Competitive Analysis

Comparable Markets

  • 40503 (higher price, more owner-occupied)
  • 40502 (premium, higher appreciation)
  • 40509 (newer, more suburban)

Market Positioning

Best value for budget-conscious buyers and investors

Competitive Advantages

  • Affordability
  • Rental demand
  • Central location

Price Comparison

40517 median home value ~$251,700 vs. Lexington overall ~$309,300[4][3]

Investment Metrics

5.5–6.5% (multifamily/duplex)
Cap Rates
6–7% gross yield typical
Rental Yields
~13–15 (favorable for investors)
Price-to-Rent
Positive for well-managed rentals, especially with value-add
Cash Flow
3–4% annual (2025 projection)[2][4]
Appreciation

Buyer Journey Insights

First-Time Buyers

Affordable options, good starter homes, may need to budget for updates

Move-Up Buyers

Limited larger homes, but good value for mid-range upgrades

Downsizers

Townhomes and smaller ranches appeal; low-maintenance options

Investors

Strong rental demand, especially for updated units; solid cash flow potential

Relocators

Central location, access to major employers, diverse housing

This zip code analysis was generated using comprehensive market data and AI intelligence.

Market conditions change rapidly - consult with local real estate professionals for the most current information.

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