Sales: According to the Alabama Association of REALTORS, September home sales in the state increased 3.7% year-over-year (Y/Y) from 6,719 to 6,965 closed transactions. Following seasonal trends, sales decreased 2.6% from August. Sales are up 13.9% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all statewide housing data, click here.
Inventory: September listings (11,047) decreased 1.1% from August 2021 and decreased 22.9% from one year ago. At the current sales pace, all the active inventory on the market would sell in 1.6 months, unchanged from August and down from 2.1 months in September 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 September was $219,899, an increase of 9.5% from one year ago and an increase of 1.6% from August. 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 September averaged 43 days on the market (DOM), 33 days faster than one year ago.
Forecast: September sales were 214 units, or 3.2%, above the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 6,751 sales for the month while actual sales were 6,965 units. ACRE forecast a total of 60,143 sales in the state year-to-date, while there were 61,006 actual sales through September, a difference of 1.4%.
New Construction: The 935 new homes sold represent 13.4% of all residential sales in the state in September. Total sales increased 10.6% from August 2021 and decreased 2.4% from one year ago. The median sales price was $296,359, a decrease of 0.3% M/M and an increase of 14% Y/Y. New homes sold in an average of 31 days, 28 days faster than September 2020.
NAR Commentary: According to the National Association of Realtors (NAR), existing home sales rebounded in September, rising 7% from August (seasonally adjusted annual rate). However, September sales decreased 2.3% from one year ago. The median sales price for all housing types was $352,800, rising 13% year-over-year and marking 115 consecutive months of year-over-year gains. Rising home prices are largely a result of low housing inventory amid sustained demand. Supply retreated slightly in September, down 0.8% from August 2021 and down 13% from one year ago. September’s 2.4 months of supply (MOS) decreased 7.7% from August and down from 2.7 MOS in September 2020.
Lawrence Yun, chief economist for NAR said, “Some improvement in supply during prior months helped nudge up sales in September. Housing demand remains strong as buyers likely want to secure a home before mortgage rates increase even further next year.”
Yun added that inventory relief in sight saying, “As mortgage forbearance programs end, and as homebuilders ramp up production – despite the supply-chain material issues – we are likely to see more homes on the market as soon as 2022.”
First-time buyers represented 28% of all existing home sales in September, down from 31% one year ago. “First-time buyers are hit particularly hard by the historically high home prices as they largely do not have the savings required to buy a home or equity to offset such a purchase,” said Yun.
ACRE Commentary: Home sales in Alabama increased year-over-year (Y/Y) in September, rising 3.7% (seasonally unadjusted). Sales decreased 2.6% month-over-month, following historical trends as a small decline is expected from August to September. Sales are up 13.9% 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 9.5% Y/Y in September, down from an average of 11.6% Y/Y during January-August 2021. The state’s housing supply decreased slightly (1.1%) from August, and listings are down 22.9% from one year ago. With sustained demand and steady inventory, months of supply tightened from 2.1 one year ago to 1.6 in September. Listings are also expected to gradually increase in the coming months with higher home prices bringing more potential sellers to the market.
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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 September 1 – 30, 2021. Thus, the performance represented is historical and should not be used as an indicator of future results.