Sales: According to the Tuscaloosa MLS, Tuscaloosa-area residential sales totaled 250 units during July, up 1.2 percent from the same period last year. The July average for sales from 2011 to 2015 was 209 units. Year-to-date sales of 1,682 units represents a 17.5 percent rise from the same period last year. Two more resources to review: Quarterly Report and Annual Report.
For all of the Tuscaloosa area’s housing data, click here.
Forecast: July results were four units or 1.6 percent above the Alabama Center for Real Estate’s monthly forecast. ACRE’s year-to-date sales forecast through July projected 1,380 closed transactions, while the actual sales were 1,494 units, a favorable difference of 8.2 percent.
Supply: Tuscaloosa July housing inventory totaled 1,175 units, a decrease of 14.3 percent from July 2015. July inventory dipped 2.4 percent from June. Historical data indicate that July inventory on average (2011-15) decreases from June by 3.6 percent. Inventory has now declined 40.3 percent from the July peak (1,969 units) reached in 2007.
Seeking balance: The inventory-to-sales ratio declined 15.3 percent year-over-year during July to 4.7 months. Restated, at the July sales pace, it would take 4.7 months to absorb the current inventory for sale. The market equilibrium (balance between supply and demand on a non-seasonally adjusted basis) is considered to be approximately 6 months during July.
Demand: July residential sales were 7.1 percent below the prior month. The decrease contrasts with seasonal buying patterns and historical data indicating that July sales on average (2011-15) increase from June by 6.7 percent. Existing single-family home sales accounted for 82 percent of total sales (up from 81 percent in July 2015), while 9 percent were new home sales (down from 12 percent) and 9 percent were condo buyers (up from 7 percent).
Pricing: The Tuscaloosa median sales price in July was $169,950, an increase of 4.9 percent compared to July 2015. The median sales price was also up 3.1 percent from June’s price. Historical data (2011-15) indicate that the median sales price in July typically increases from June by 5.3 percent. It should also be noted that differing sample size (number of residential sales of comparative months) can contribute to statistical volatility, including pricing. Consult with a real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood.
Industry perspective: “Financial volatility resulting from Brexit has created some uncertainty among investors as yields on government bonds have dropped sharply, Treasury yield curves have flattened over the past month, and the Chinese Yuan has depreciated to a six-year low against the dollar,” said Fannie Mae Chief Economist Doug Duncan. “In addition, our view on interest rates continues to be ‘low for long’ as we believe a Fed decision to raise interest rates will likely be on hold until June of 2017. Brexit’s economic impact on the U.S. will likely be limited, especially from a trade perspective, and should be a near-term positive for the housing and mortgage market as falling mortgage rates have prompted new refinance demand.” For the full report, click here.
Click here to generate more graphs from the Tuscaloosa July Housing Report, including Total Sales, Average Sales Price, Days on the Market, Total Inventory and Months of Supply.