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

Sales: According to the Wiregrass Multiple Listing Service, there were 103 residential sales in the Wiregrass region during March, a 17 percent increase from one year ago. Existing single-family homes accounted for 90 percent of all residential sales, while the remaining 10 percent were newly constructed homes. Two more resources to review: Quarterly Report and Annual Report.

For all of the Wiregrass area housing data, click here.

Forecast: March sales were 12 units higher than the Alabama Center for Real Estate’s (ACRE) monthly forecast of 91 closed transactions. 

Supply: Wiregrass area housing inventory totaled 784 listings in March, an increase of 10.7 percent from one year ago. The Wiregrass region had 65 newly constructed homes listed for sale in March and 719 existing single-family homes listed. Inventory in the region increased 6.8 percent from the previous month.

Demand: March residential sales were up 37.3 percent from the prior month. This rise in sales is typical, as March sales data from 2013-17 indicate that sales on average increase from February by 39.2 percent. The average number of days on the market until a listing sold was 132 days, a 13.7 percent decrease from 153 days on the market one year ago. This statistic has seen much improvement since peaking in March 2014 at 191 days on the market.

Seeking balance: The inventory for sale divided by the current monthly sales volume equals the number of months of supply. Most real estate professionals consider the market to be in balance at approximately 6 months of supply. The inventory-to-sales ratio during March was 7.6 months of housing supply, down from 9.8 months of supply one month ago and down from 8 months of supply one year ago. In other words, at the March sales pace it would take 7.6 months to absorb the current inventory for sale.

Pricing: The Wiregrass area median sales price in March was $134,000, an increase of 14.5 percent from one year ago and a 21.3 percent increase from the previous month. It should be noted that the differing sample size and seasonal buying patterns can contribute to statistical volatility, including pricing. ACRE recommends consulting with a local real estate professional to discuss prices, as they will vary from neighborhood to neighborhood.

Industry perspective: Interest rates are likely to increase throughout 2018. The Federal Reserve’s Federal Open Market Committee (FOMC) met on March 21 and approved a quarter-point rate hike. As of April 5, the 10-Year Treasury stood at 2.83 percent, down slightly from 2.88 percent one month ago. Although daily yield curve rates have decreased slightly in the past month, many analysts are projecting that the 10-year Treasury will pass 3 percent in the months to come. According to Wells Fargo, the current interest rate on a 30-year fixed-rate mortgage is 4.58 percent (annual percentage rate).

As the overall economy continues to expand, it is not surprising to see growth in Alabama’s residential new construction market. February sales of newly constructed homes grew 22 percent month-over-month and 14 percent year-over-year. Statewide*, there were 507 new construction sales in February, up from 416 total sales in January and up from 445 total sales in February 2017. Year-to-date, new construction sales are up 6 percent from 2017.

February new construction sales in select Alabama markets

• Baldwin County – 100
• Birmingham Metro Area – 125
• Huntsville Metro Area – 112
• Lee County – 36
• Mobile Metro Area – 17
• Montgomery Metro Area – 35
• Tuscaloosa County – 15

New construction building permits and housing starts data are indicators of larger economic conditions. Generally speaking, the housing market is one of the first sectors to expand or contract during times of growth or decline. According to the U.S. Census Bureau, 1,225 building permits for new construction were issued in Alabama during February. Building permits increased 1.1 percent from January, when 1,212 permits were issued, and increased 10.1 percent from February 2017, when 1,113 permits were issued. ACRE projected 1,219 housing starts in Alabama during February. Housing starts decreased 2.9 percent from January (1,256) and increased 13 percent from February 2017 (1,079). Year-over-year increases in both building permits and projected housing starts are encouraging news, as they hint toward continued overall economic growth during the second quarter of 2018.

*ACRE receives new construction sales data from the following counties/areas: Baldwin County, Birmingham Metro Area, Calhoun County, Huntsville Metro Area, Lee County, Mobile Metro Area, Montgomery Metro Area, Tuscaloosa County and the Wiregrass Region. Combined, these counties/areas represent +/- 70 percent of Alabama’s total population.

Click here to view more graphs from the Wiregrass Region March Housing Report, including Total Sales, Average Sales Price, Days on the Market, Total Inventory and Months of Supply. 

The Wiregrass Residential Monthly Report is developed in conjunction with the Wiregrass Board of Realtors to better serve Wiregrass area consumers.