Sales: According to the Alabama Association of REALTORS, July home sales in the state decreased 1.5% year-over-year (Y/Y) from 7,714 to 7,601 closed transactions, ending 13 consecutive months of Y/Y gains. Going against seasonal trends, sales decreased 7.7% from June. Sales are now up 17.3% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all statewide housing data, click here.
Inventory: July listings (11,146) increased 12% from June 2021, the second consecutive month-over-month (M/M) inventory gain. However, housing inventory in the state still remains tight with listings down 29.3% from one year ago, with the last Y/Y inventory gain in February 2015.
Months of supply (inventory to sales ratio) increased month-over-month (1.2 to 1.5), but is significantly below the 2.0 months of supply in July 2020, reflecting a market where seller’s generally have elevated bargaining power.
Pricing: The statewide median sales price in July was $218,374, a record high and an increase of 11% from one year ago and an increase of 0.8% from June. 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 July averaged 43 days on the market (DOM), a record low and 38 days faster than one year ago.
Forecast: July sales were 352 units, or 4.9%, above the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 7,249 sales for the month while actual sales were 7,601 units. ACRE forecast a total of 46,144 sales in the state year-to-date, while there were 46,889 actual sales through July, a difference of 1.61%.
New Construction: The 852 new homes sold represent 11.2% of all residential sales in the state in July. Total sales decreased 15.1% from June 2021 and decreased 18.6% from one year ago. The median sales price was $301,052, an increase of 12.2% M/M and an increase of 20.5% Y/Y. New homes sold in an average of 30 days, a record low and 28 days faster than July 2020.
NAR Commentary: According to the National Association of Realtors (NAR), existing home sales nationwide increased for the second consecutive month in July rising 2% from June (seasonally adjusted annual rate). July sales were up 1.5% from one year ago. The median sales price for existing homes was $359,900, rising 17.8% year-over-year and marking 113 consecutive months of year-over-year gains. Rising home prices are largely a result of low housing inventory amid significantly elevated demand. Supply did improve somewhat, rising 7.3% from June 2021 and is down 12% from one year ago. July’s 2.6 months of supply increased slightly from June (2.5) but is still well below July 2020 (3.1).
Lawrence Yun, chief economist for NAR said, “We see inventory beginning to tick up, which will lessen the intensity of multiple offers. Much of the home sales growth is still occurring in the upper-end markets, while the mid- to lower-tier areas aren’t seeing as much growth because there are still too few starter homes available.”
Yun added that home prices are likely to moderate in the months ahead, “Although we shouldn’t expect to see home prices drop in the coming months, there is a chance that they will level off as inventory continues to gradually improve.”.
ACRE Commentary: Home sales in Alabama decreased year-over-year (Y/Y) in July, falling 1.4% (seasonally unadjusted). Sales also declined month-over-month, down 7.7% from June. Year-to-date, however, sales are up 17.3% from 2020. The statewide median sales price reached another record high of $218,374 with sales price growth rates moderating somewhat, rising 11% Y/Y. The state’s housing supply received a much-needed measure of relief as listings increased 12% from June, but are still down 29.3% from one year ago. With slowing sales and rising inventory, months of supply increased from 1.2 in June to 1.5 in July. Listings are also expected to gradually increase in the coming months.
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The Alabama Residential Monthly Report is developed in connection with the Alabama Association of Realtors.
Editor’s Note: All information in this article reflects data provided to the Alabama Center for Real Estate for the time period July 1 – 31, 2021. Thus, the performance represented is historical and should not be used as an indicator of future results.