Sales: According to the Greater Alabama Multiple Listing Service, the Birmingham metro area* residential sales totaled 802 units during November, 25 units or 3 percent below the same time last year. Year-to-date residential sales increased by 6 percent from the prior year. Two more resources to review: Quarterly Report and Annual Report.
For all of the Birmingham area’s housing data, click here.
Forecast: November sales were 16.5 percent or 159 units below our monthly forecast. Alabama Center for Real Estate’s (ACRE) year-to-date sales forecast through November projected 12,332 closed transactions while the actual sales were 12,289 units, 0.35 percent lower.
Supply: The Birmingham area housing inventory in November was 7,051 units, an increase of 2.5 percent from November 2014 but down 45.7 percent from the November peak in 2007 (12,979 units). November inventory in the Birmingham metro area also decreased 3.1 percent from the prior month. This direction is consistent with seasonal patterns and historical data indicating that November inventory on average (2010-14) decreases from October by 2 percent.
According to the Greater Alabama MLS, the Birmingham metro area market, there was 8.8 months of housing supply during November, up slightly from 8.3 during November 2014.While not ideal, this number is 51.8 percent better than the 2008 peak of 18.2 months of supply and 19 percent better than the 5-year average of 10.9 months from 2010-2014. The “months of housing supply” is a simple calculation – homes listed (supply) divided by homes sold (demand). In general, about 6 months is considered the point of equilibrium during November. At the current sales pace, Birmingham is increasingly favoring sellers.
Demand: November residential sales decreased by 21 percent from the prior month. This direction is consistent with historical data indicating that November sales, on average (2010-14), decrease from October by 5.5 percent.
Existing single family home sales accounted for 85 percent (up from 83 percent during November 2014) of total sales while 12 percent (down from 14 percent in November 2014) were new home sales and 3 percent (unchanged from November 2014) were condo buyers.
Pricing: The median sales price in November was $174,750, an increase of 6 percent from last November ($165,000). The October median sales price also increased 4.3 percent from the prior month. This direction is consistent with historical data (2010-14) indicating that the November median sales price on average decreases from October by 4 percent. Pricing can fluctuate from month to month as the sample size of data (closed transactions) is subject to seasonal buying patterns. Consulting with a local real estate professional who has access to pricing data at the neighborhood level is recommended.
Industry Perspective: “Despite mixed housing and mortgage market data, our forecast for housing activity is little changed over the past several months,” said Fannie Mae Chief Economist Dave Duncan. “The supply of existing homes remains lean amid slowing new single-family construction, putting significant upward pressure on home prices. While this helps boost home equity, it hurts affordability, especially for potential first-time homebuyers. Meanwhile, we expect mortgage rates to rise only gradually through next year, and an improving income trend should help support affordability. We foresee total home sales improving further in 2016, albeit at less than half of the 8 percent increase expected this year.” For full report click here.
The Birmingham Residential Monthly Report is work product developed in conjunction with the Greater Alabama MLS and the Birmingham Association of REALTORS to better serve Birmingham metro area consumers. The ACRE monthly report is provided to illustrate the “general” market direction & trends when comparing prior periods with the most current residential data available. Real estate is local and statistics will fluctuate between areas within a city including subdivisions, and ACRE recommends that you consult a local real estate professional for “specific” advice associated with your market. 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.