Sales: According to the Etowah-Cherokee Association of Realtors, February residential sales in the Gadsden area decreased 14.8% year-over-year from 81 to 69 closed transactions. Following seasonal trends, sales increased 4.6% from January. Sales are now down 2.2% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all of the Gadsden area’s housing data, click here.
Inventory: Following regional trends but to a greater degree, total homes listed for sale in February decreased 60.4% year-over-year from 316 to 125 listings. Months of supply dropped from 3.9 to 1.8, reflecting a market where sellers generally have elevated bargaining power.
Pricing: The area’s median sales price in February was $149,900, an increase of 26% from one year ago and a decrease of 11.8% from January. The differing sample size (number of residential sales of comparative months) can contribute to statistical volatility, including pricing. ACRE recommends consulting with a local real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood.
Homes sold in February averaged 79 days on market, 14 days faster than February 2020.
Forecast: February sales were 14 units, or 16.6%, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 83 sales for the month, while actual sales were 69 units. ACRE forecast a total of 164 sales in the area year-to-date, while there were 135 actual sales through February, a difference of 17.7%.
NAR commentary: According to the National Association of Realtors (NAR), existing home sales nationwide decreased in February, falling 6.6% from January (seasonally adjusted annual rate). However, sales did increase year-over-year, rising 9.1% from February 2020. Sales prices continue to grow at higher rates than before the pandemic, rising 15.8% year-over-year. Rising home prices are largely a result of housing inventory remaining at a record low of 1.03 million listings in February, representing a record decline of 29.5% year-over-year.
Lawrence Yun, chief economist for NAR said, “Despite the drop in home sales for February – which I would attribute to historically-low inventory – the market is still outperforming pre-pandemic levels. I still expect this year’s sales to be ahead of last year’s, and with more COVID-19 vaccinations being distributed and available to larger shares of the population, the nation is on the cusp of returning to a sense of normalcy. Many Americans have been saving money and there’s a strong possibility that once the country fully reopens, those reserves will be unleashed on the economy.”
Yun also cautioned that home sales could slow in the months ahead as higher prices and rising mortgage rates decrease home affordability.
ACRE commentary: Home sales in Alabama increased 14.7% year-over-year (Y/Y) in February, marking nine consecutive months of Y/Y gains. The strong rebound in demand seen during the second half of 2020 has extended into 2021. Year-over-year growth rates, however, have moderated somewhat since reaching a peak of 26.6% in the fourth quarter of 2020. Home sales prices continued their upward trend in February, rising 13.1% Y/Y, mainly a result of market fundamentals (increased demand and continued reduction in supply). Housing inventory in the state reached a record low of 9,950 listings in February, falling 44% Y/Y, a record decline.
Click here to view the entire monthly report.
The Gadsden Residential Monthly Report is developed in conjunction with the Etowah-Cherokee Association of Realtors to better serve area consumers.
Editor’s Note: All information in this article reflects data provided to the Alabama Center for Real Estate for the time period February 1 – 28, 2021. Thus, the performance represented is historical and should not be used as an indicator of future results.