Sales: According to the Phenix City Board of Realtors Multiple Listing Service, Phenix City area residential sales totaled 95 units during March, down from 99 in the same month a year earlier. Results were 7.5 percent above the five-year March average of 88 sales. Two more resources to review: Quarterly Report and the Annual Report.
For all of Phenix City’s area home sales data, click here.
Forecast: March sales were 16 units, or 14.4 percent, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 111 sales for the month, while actual sales were 95 units. ACRE forecast a total of 269 residential sales in the Phenix City area during the first quarter of 2018, while there were 228 actual sales.
Supply: Phenix City area housing inventory in March totaled 476 listings, a decrease of 12.2 percent from March 2017. Inventory levels have reduced 61.6 percent from the 10-year March peak reached in 2008, when 1,241 units were listed for sale. The inventory-to-sales ratio in March was 5 months of housing supply. Restated, at the March sales pace, it would take 5 months to absorb the current inventory for sale. The market equilibrium (balance between supply and demand) is considered to be approximately 6 months.
Demand: March sales increased 39.7 percent from the prior month. This direction is consistent with historical data indicating that March sales on average (2013-17) increase from February by 21.3 percent. The average number of days on the market until homes sold was 106 days, down 14.5 percent from the previous year.
Pricing: The Phenix City median sales price in March was $159,000, an increase of 20.9 percent from one year ago and an increase of 7.4 percent from the prior month. This direction is consistent with historical data (2013-17) indicating that the March median sales price on average increases from February by 6.8 percent. 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.
Industry perspective: Interest rates are likely to increase throughout 2018. The Federal Reserve’s Federal Open Market Committee (FOMC) met on March 21 and approved a quarter-point rate hike. As of April 5, the 10-Year Treasury stood at 2.83 percent, down slightly from 2.88 percent one month ago. Although daily yield curve rates have decreased slightly in the past month, many analysts are projecting that the 10-year Treasury will pass 3 percent in the months to come. According to Wells Fargo, the current interest rate on a 30-year fixed-rate mortgage is 4.58 percent (annual percentage rate).
As the overall economy continues to expand, it is not surprising to see growth in Alabama’s residential new construction market. February sales of newly constructed homes grew 22 percent month-over-month and 14 percent year-over-year. Statewide*, there were 507 new construction sales in February, up from 416 total sales in January and up from 445 total sales in February 2017. Year-to-date, new construction sales are up 6 percent from 2017.
February new construction sales in select Alabama markets
- Baldwin County – 100
- Birmingham Metro Area – 125
- Huntsville Metro Area – 112
- Lee County – 36
- Mobile Metro Area – 17
- Montgomery Metro Area – 35
- Tuscaloosa County – 15
New construction building permits and housing starts data are indicators of larger economic conditions. Generally speaking, the housing market is one of the first sectors to expand or contract during times of growth or decline. According to the U.S. Census Bureau, 1,225 building permits for new construction were issued in Alabama during February. Building permits increased 1.1 percent from January, when 1,212 permits were issued, and increased 10.1 percent from February 2017, when 1,113 permits were issued. ACRE projected 1,219 housing starts in Alabama during February. Housing starts decreased 2.9 percent from January (1,256) and increased 13 percent from February 2017 (1,079). Year-over-year increases in both building permits and projected housing starts are encouraging news, as they hint toward continued overall economic growth during the second quarter of 2018.
*ACRE receives new construction sales data from the following counties/areas: Baldwin County, Birmingham Metro Area, Calhoun County, Huntsville Metro Area, Lee County, Mobile Metro Area, Montgomery Metro Area, Tuscaloosa County and the Wiregrass Region. Combined, these counties/areas represent +/- 70 percent of Alabama’s total population.
Click here to download graphs from the Phenix City March Housing Report, including Total Sales, Average Sales Price, Days on the Market, Total Inventory and Months of Supply.