Sales: According to the Alabama Association of REALTORS, August home sales in the state increased 3.9% year-over-year (Y/Y) from 6,884 to 7,152 closed transactions. Following seasonal trends, sales decreased 5.9% from July. Sales are up 15.3% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all statewide housing data, click here.
Inventory: August listings (11,164) increased 0.2% from July 2021, the third consecutive month-over-month (M/M) inventory gain. However, housing inventory in the state still remains tight with listings down 24.7% from one year ago, with the last Y/Y inventory gain in February 2015.
At the current sales pace, all the active inventory on the market would sell in 1.6 months, up from 1.5 months in July and down from 2.2 months in August 2020. The equilibrium point where buyers and sellers have roughly equal bargaining power is 6 months of supply.
Pricing: The statewide median sales price in August was $216,396, an increase of 6.6% from one year ago and a decrease of 0.9% from July. 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 August averaged 39 days on the market (DOM), a record low and 50 days faster than one year ago.
Forecast: August sales were 96 units, or 1.3%, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 7,248 sales for the month while actual sales were 7,152 units. ACRE forecast a total of 53,392 sales in the state year-to-date, while there were 54,041 actual sales through August, a difference of 1.2%.
New Construction: The 845 new homes sold represent 11.8% of all residential sales in the state in August. Total sales decreased 3.2% from July 2021 and decreased 6.1% from one year ago. The median sales price was $297,381, a decrease of 1.3% M/M and an increase of 10.3% Y/Y. New homes sold in an average of 25 days, a record low and 43 days faster than August 2020.
NAR Commentary: According to the National Association of Realtors (NAR), existing home sales nationwide decreased in August, down 2% from July (seasonally adjusted annual rate). August sales were also down 1.5% from one year ago. The median sales price for existing homes was $356,700, rising 14.9% year-over-year and marking 114 consecutive months of year-over-year gains. Rising home prices are largely a result of low housing inventory amid sustained demand. Supply retreated in August, down 1.5% from July 2021 and is down 13.4% from one year ago. August’s 2.6 months of supply was unchanged from July and down 13.3% from 3.0 in August 2020.
Lawrence Yun, chief economist for NAR said, “Sales slipped a bit in August as prices rose nationwide. Although there was a decline in home purchases, potential buyers are out and about searching, but much more measured about their financial limits, and simply waiting for more inventory.”
Yun also discussed current market conditions and home prices saying, “High home prices make for an unbalanced market, but prices would normalize with more supply.”
ACRE Commentary: Home sales in Alabama increased year-over-year (Y/Y) in August, rising 3.9% (seasonally unadjusted). Sales decreased 5.9% month-over-month, following historical trends as a small decline is expected from July to August. Sales are up 15.3% year-to-date, with another record year for home sales likely in 2021.
Home price growth is moderating somewhat with the statewide median sales price gaining 6.6% Y/Y in August, down from an average of 12.3% Y/Y during January-July 2021. The state’s housing supply increased slightly (0.2%) from July, but listings are down 24.7% from one year ago. With sustained demand and rising inventory, months of supply increased from 1.5 in July to 1.6 in August. Listings are also expected to gradually increase in the coming months with higher home prices bringing more potential sellers to the market.
Click here to view the entire monthly report.
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 August 1 – 31, 2021. Thus, the performance represented is historical and should not be used as an indicator of future results.