Click here to view or print the entire new home monthly report compliments of the ACRE Corporate Cabinet.

Demand: New home sales totaling 364 units in May increased 9.3 percent from the same period last year. May new homes sales were 16.3 percent above the prior month. Average days on market in May of 106 represent a 1.2 percent decrease from last May.

New home sales in May rose 16.2 percent over last year at this time.

Supply: Months of new home supply in May was 5.3 months. Statewide new construction inventory is approximately 15.9 percent above last May and down 0.8 percent from last month.

Pricing: Alabama’s metro median new home sales price during May was $240,907, a decrease of 1.6 percent from May 2015, but an increase of 5.4 percent from April 2016.

New home pipeline: May statewide housing starts were up 15.1 percent from 2015 and up 9.5 percent from April. Statewide building permits in May were up 16.2 percent from May 2015 but were down 1.7 percent from April 2016.

Residential construction employment: According to the Alabama Department of Industrial Relations, statewide related residential construction employment in May decreased 0.74 percent (minus 600 jobs) to 80,400 from the same period last year and was down 1.35 percent from the previous month. This ends a string of 20 consecutive months of positive YOY comparisons associated with construction employment.

Local results: Fourteen of the 27 associations (51 percent) reported building permit gains from May 2015, while 10 associations (37 percent) experienced gains in housing starts. Sixteen associations experienced an increase from their April 2016 monthly housing starts.

Industry perspective: According to Robert Dietz, National Association of Home Builders chief economist, “On a three-month moving average basis, single-family starts ticked down due to the elevated construction pace recorded in February. While NAHB expects growth in single-family construction due to favorable demographics, lot supplies are a growing challenge holding back production, particularly in markets in the West and Northeast. … Regionally, expansion has been particularly strong in the South, where single-family starts for April are 17 percent higher than a year ago. On a non-seasonally adjusted basis, 55 percent of single-family starts for the month were located in the South.”

The ACRE New Construction Monthly Report stems from a partnership with the Home Builders Association of Alabama Foundation. The Alabama Center for Real Estate’s core purpose is to advance the industry by providing relevant research, education and outreach.