Sales: According to the Montgomery Area Association of Realtors Multiple Listing Service, Montgomery-area home sales totaled 316 units during December, down 8.1 percent from 344 sales in the same month a year earlier. December sales were down 15.5 percent compared to 374 sales in November. Total sales for 2018 increased 6 percent from the 2017 total. Results were 1.3 percent above the five-year December average of 312 sales.
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Inventory: Homes listed for sale in the Montgomery area during December totaled 1,769 units, a decrease of 7.9 percent from December 2017’s 1,921 units, and also a decrease of 7.9 percent from November 2018’s 1,920 units. December months of supply totaled 5.6 months, an increase of 9 percent from December 2017’s 5.6 months of supply. December’s months of supply stayed constant with November’s 5.6 months of supply.
Pricing: The Montgomery-area median sales price in December was $168,500, an increase of 8.7 percent from one year ago and an increase of 12.5 percent from the prior month. The differing sample size (number of residential sales of comparative months) can contribute to statistical volatility, including pricing. ACRE highly recommends consulting with a local real estate professional to discuss pricing trends, as they will vary from neighborhood to neighborhood. The homes selling in December spent an average of 101 days on the market (DOM), a decrease of 8.2 percent from 110 days in December 2017, and an increase of 7.5 percent from 99 days in November.
Forecast: December sales were 33 units, or 9.5 percent, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 349 sales for the month, while actual sales were 316 units. ACRE forecast a total of 4,637 residential sales in the Montgomery area during 2018, while there were 4,666 actual sales.
ACRE’s statewide perspective: After 10 consecutive months of gains, statewide residential sales in December decreased 1.6 percent year-over-year from 4,371 to 4,303 closed transactions. For the entire year, statewide residential sales increased 6.3 percent from 57,427 in 2017 to 61,062 in 2018. Home price appreciation in the state continued to climb as the median sales price in December increased 4.7 percent year-over-year from $151,667 to $158,772. The median sales price for all of 2018 was up 4.6 percent from 2017. Although nationwide inventory levels are trending upwards, Alabama’s residential inventory decreased 6.9 percent from one year ago. Low inventory levels were a major factor contributing to rising sales prices throughout 2018. With low inventory, it is not surprising to see homes selling more quickly than in previous years. Homes selling in Alabama during December spent an average of 102 days on the market, an improvement of 11 days from 2017.
NAR’s national perspective: During December, total existing-home sales nationwide declined 11.7 percent from approximately 427,000 one year ago to 377,000 currently. Lawrence Yun, chief economist for the National Association of Realtors, says current housing numbers are partially due to higher interest rates during most of 2018. “The housing market is obviously very sensitive to mortgage rates. Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today. Now, with mortgage rates lower, some revival in home sales is expected going into spring.”
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The Montgomery Area Residential Monthly Report is developed in conjunction with the Montgomery Area Association of Realtors to better serve its area consumers.