ALABAMA REAL ESTATE JOURNAL

Alabama’s new home sales decrease 3% year-over-year in February

New home sales in Alabama during February decreased 2.8% year-over-year from 758 to 737 closed transactions. Following seasonal trends, sales increased 20.0% from January. New home sales are up 5.5% year-to-date.   

Inventory: New home listings (3,041) decreased 9.4% from January and decreased 10.1% from one year ago. The number of new home listings in February increased significantly from recent years, rising 28.3% from the 5-year average. 

At the current sales pace, all the active inventory on the market would sell in 4.1 months, down from 5.5 in January and 4.5 in February 2024. The equilibrium point where buyers and sellers have roughly equal bargaining power is 6 months of supply. 

Pricing: The median sales price for new construction in February was $314,286, an increase of 1.3% from January and a decrease of 6.9% from one year ago.  

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. 

New homes sold in February averaged 73 days on the market (DOM), 13 days slower than one year ago. Average DOM is expected to remain in the 60 to 80-day range for the foreseeable future.  

Building Permits for New Single-Family Units: Permits for new SF units in Alabama decreased 10.9% year-over-year from 1,495 to 1,332 units. Permits are down 8.8% year-to-date.  

Single Family Housing Starts: Housing starts decreased 5.5% year-over-year from 1,385 to 1,309 units. Housing starts are down 2.6% year-to-date.  

National Overview: According to the U.S. Census Bureau, new home sales nationwide were at a seasonally adjusted annual rate of 676,000 in February. This represents a 1.8% increase from the revised January rate of 664,000 and is 5.1% above the February 2024 estimate of 643,000.  

The median sales price for new homes ($414,500) decreased 3.0% from January and decreased 1.5% from February 2024.  

The supply of new homes was estimated at 500,000 listings (seasonally adjusted) in February, an increase of 0.8% from January and an increase of 7.5% from one year ago.  

The national new home market had 8.9 months of supply in February 2025, up from 8.7 one year ago.  

Click here to view the entire monthly report. 

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