Sales: According to the Tuscaloosa MLS, Tuscaloosa-area residential sales totaled 170 units during October, up 7.6 percent from the same period last year. The October average for sales from 2011 to 2015 was 143 units. Year-to-date sales of 2,094 units represent a 16 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: October results were one unit or 0.5 percent below the Alabama Center for Real Estate’s monthly forecast. ACRE’s year-to-date sales forecast through October projected 1,965 closed transactions, while the actual sales were 2,094 units, a favorable difference of 6.5 percent.
Supply: Tuscaloosa October housing inventory totaled 1,153 units, a decrease of 9 percent from October 2015. October inventory dipped by 2.5 percent compared to September. Historical data indicate that October inventory on average (2011-15) increases from September by 0.1 percent. Inventory has now declined 41 percent from the October peak (1,937 units) reached in 2007.
Seeking balance: The inventory-to-sales ratio declined 15.4 percent year-over-year during October to 6.8 months. Restated, at the October sales pace, it would take 6.8 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 October.
Demand: October residential sales were 15 percent below the prior month. The decrease contrasts with seasonal buying patterns and historical data indicating that October sales on average (2011-15) increase from September by 1.2 percent. Existing single-family home sales accounted for 88 percent of total sales (up from 84 percent in October 2015), while 7 percent were new home sales (down from 9 percent) and 5 percent were condo buyers (down from 7 percent).
Pricing: The Tuscaloosa median sales price in October was $163,750, an increase of 12 percent compared to October 2015. The median sales price was down 1.4 percent from September’s price. Historical data (2011-15) indicate that the median sales price in October typically increases from September by 6.1 percent. It should 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: “Since July, more consumers, on net, have steadily expected mortgage rates to rise and home price appreciation to moderate,” said Doug Duncan of Fannie Mae. “Furthermore, consumers’ perception of their income over the past year deteriorated sharply in October to the worst showing since early 2013, weighing on the index. However, this component of the HPSI (home purchase sentiment index) is volatile from month to month, and the firming trend in wage gains from the October jobs report, if sustained, may foreshadow an improving view in the near future.”
Click here to generate more graphs from the Tuscaloosa October Housing Report, including Total Sales, Average Sales Price, Days on the Market, Total Inventory and Months of Supply.