Demand: Alabama new home sales totaling 378 units in September increased 12.5 percent from the same period last year. September new homes sales were 3.6 percent below the prior month. Average days on market in September of 124 represent a 21.6% increase from last September.
Supply: New construction inventory increased 2.3 percent from September 2014. Three of five metro areas experienced decreases in inventory from last September with the exception of Montgomery (up 8.2 percent) and Birmingham (up 15 percent).
Alabama’s metro markets (appropriately 70% of the statewide market) in September reflect 4.7 months of new home supply, favorably down 10.6 percent from last September (5.2 months but up from 4.4 months of supply in August.
Pricing: Alabama metro market’s median new home sales price in September was $244,774, an increase of 0.8 percent from last September and an decrease of 0.8 percent from last month.
New Home Pipeline: September statewide housing starts were up 1 percent from 2014 but 3.9 percent below the prior month. Statewide building permits in September were down 4.3 percent from September 2014 and 10.4 percent below last month. 2014 permits were down .8 percent.
Residential Construction Employment: According to the Alabama Dept. of Industrial Relations, statewide related residential construction employment in September increased 4.4% (+3,000 jobs) to 68,100 from the same period last year and was up by 100 jobs from the prior month. This represents the 15th consecutive month of positive YOY comparisons associated with construction employment.
Local Results: Eight out of the 27 associations (29.6% – down from 44% from August ’15) reported building permit gains from the prior month while 10 associations (37% – down from 44% from August ’15) experienced gains in housing starts. Fourteen associations (51% – experienced an increase from their September 2014 monthly housing starts.
Industry Perspective: From David Crowe, NAHB chief economist: “With October’s three-point uptick, builder confidence has been holding steady or increasing for five straight months. This upward momentum shows that our industry is strengthening at a gradual but consistent pace,” said NAHB Chief Economist David Crowe. “With firm job creation, economic growth and the release of pent-up demand, we expect housing to keep moving forward as we start to close out 2015.”
Bryan Davis is the research/media Coordinator for the Alabama Center for Real Estate housed within the Culverhouse College of Commerce at the University of Alabama. He can be reached at 205-348-5416 or at [email protected] The ACRE New Construction Monthly Report is work product stemming from our partnership with the Home Builder’s Association of Alabama Foundation. The Alabama Center for Real Estate‘s core purpose is to advance the real estate industry in Alabama by providing relevant resources in the areas of research, education and outreach. Join the Center mailing list HERE.