Sales: According to the Baldwin County Association of Realtors/Multiple Listing Service, February residential sales in Baldwin County totaled 410 units, up 8.8 percent from last February. Current sales are 18.6 percent above the five-year February average of 346 residential sales. The 10-year low for February sales in Baldwin County was in 2009, when only 174 residential transactions were recorded. Two more resources to review: Quarterly Report and Annual Report.
For all of Baldwin County’s housing data, click here.
Forecast: February results were 40 units below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 850 closed transactions through February, while there were 801 actual sales.
Supply: The Baldwin County housing inventory in February was 2,798 units, an increase of 6.5 percent from one year ago. The area’s housing inventory has declined 50.4 percent from the 10-year February peak in 2008, when 5,636 units were available for sale. There were 6.8 months of housing supply in February, representing a decrease of 2 percent from the 7 months of housing supply available in the area in February 2017. The market reaches equilibrium at approximately 6 months of housing supply, with an even balance between supply and demand.
Demand: Baldwin County residential sales increased 4.9 percent from January. This is consistent with historical data indicating that February residential sales on average (2013-17) increase from January by 13.3 percent. Existing single-family homes accounted for 59 percent of total sales in the area, while 19 percent of sales were new construction. Condo sales accounted for the remaining 22 percent. The average number of days on the market in February was 95, representing a decrease of 43.5 percent from one year ago, when homes in the area averaged 168 days on the market.
Pricing: The Baldwin County median sales price in February was $238,250, an increase of 8.3 percent from February 2017, when the median price was $220,000. The median sales price was up 3.8 percent from the prior month. This month-over-month price increase runs against historical data trends from 2013-17 indicating that February median sales prices on average decrease 0.5 percent from January. ACRE highly recommends consulting with a real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood.
Industry perspective: The 10-year treasury is a crucial indicator of economic expansion. As of March 1, 2018, the 10-year treasury stood at 2.88 percent, a slight increase from last month’s rate of 2.86 percent. Mortgage rates also experienced a slight increase recently as the current rate on a 30-year fixed-rate mortgage is 4.57 percent, up from 4.38 percent one month ago. As the economy continues to strengthen, people will have more money in their pockets with the intent to spend. This increase in spending will most likely create higher stock prices and lower bond prices. With this increase of confidence in the market, mortgage interest rates can be expected to increase.
The National Association of Home Builders (NAHB) produces economic analyses of the home-building industry based on government data. The Housing Market Index (HMI) depicts market conditions for the sale of new homes. The HMI ranges from 0 to 100; a rate greater than 50 represents good sales conditions.
The HMI in the South has stayed relatively steady in the past few months with a score of 73. However, the HMI is lower in some regions of the United States, such as the Northeast, which has a rate of 56. The West has a higher HMI of 77, and a better market for good housing conditions.
The Federal Housing Finance Agency uses the House Price Index (HPI) to measure the average price changes in repeat sales or refinancing on the same properties. The FHFA’s national HPI was up 6.7 percent from the previous year compared to Alabama, which has increased from the previous year by 5.6 percent. The HPI rose in all 49 states except for Mississippi.
Compared to the national housing market conditions, Alabama’s real estate market has been showing improvement. Although total residential sales in Alabama decreased 2.3 percent from January 2017, the statewide median sales price increased 2.3 percent from January 2017. Statewide, homes in Alabama are selling much more quickly than in recent years as the average days on the market decreased 19.6 percent from one year ago.
Click here to generate more graphs from the Baldwin County February Housing Report, including Total Sales, Average Sales Price, Days on the Market, Total Inventory and Months of Supply.