Sales: According to the Montgomery Area Association of Realtors’ Multiple Listing Service, Montgomery-area residential sales totaled 360 units during October, an increase in sales of 15.8 percent from October 2016’s total of 311 units. Year to date, sales are up 11 percent from the same period of 2016. Another resource to review is the Annual Report.
Forecast: Closed transactions during October were 23 units or 6.8 percent above the Alabama Center for Real Estate’s monthly forecast. ACRE’s year-to-date sales forecast through September projected 3,508 closed transactions, while the actual sales were 3,703 units.
Supply: The Montgomery area housing inventory in October was 2,216 units, a decrease of 8.8 percent from October 2016 and 38.1 percent below the month-of-October peak in 2007 (3,580 units).
There were 6.2 months of housing supply during October, a decrease of 21.2 percent from the same time in 2016. About 6 months of supply is considered a balanced market, with buyer and seller having equal bargaining power.
October inventory in the Montgomery area decreased 6.9 percent from the prior month. This direction is consistent with historical data indicating September inventory on average (2012-2016) decreases from September by 2.3 percent.
Demand: October residential sales increased 5 percent from the prior month.
Pricing: The Montgomery-area median sales price in October was $149,450, up 6 percent from October 2016 ($141,000). The median sales price decreased 0.4 percent from the prior month. Historical data (2012-2016) indicate the October median sales price typically decreases from September by 1.2 percent. Pricing can fluctuate from month to month as the sample size of data (closed transactions) is subject to seasonal buying patterns. ACRE recommends contacting a local real estate professional for additional market pricing information.
Industry perspective: “The first print of third-quarter economic growth showed surprising resiliency. The expected economic hit from the recent natural disasters either failed to materialize or was drowned out by business optimism,” said Fannie Mae Chief Economist Doug Duncan. “Recent data showed a stronger pickup in domestic demand than anticipated, leading us to increase our growth forecast for the final quarter of this year and coming quarters. We also revised higher our 2018 growth forecast to 2 percent. Tax cuts, if enacted, present upside risk to our growth forecast for next year but could also lead to more aggressive Fed action. Housing still remains a drag on the economy, as shortages of labor and available lots, coupled with rising building material prices, further complicate existing inventory, affordability and sales challenges.”