Sales: According to the Greater Alabama MLS, June home sales in the Birmingham area increased 10.1% year-over-year from 1,581 to 1,741 closed transactions. Going against seasonal trends, sales increased 34.2% from May. The June gain ended two months of year-over-year sales declines, and total residential sales in the area are down 2.4% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all Birmingham-area housing data, click here.
Inventory: Homes listed for sale decreased 12.1% year-over-year from 5,381 listings one year ago to 4,730 in June. Months of supply (inventory to sales ratio) decreased from 3.4 months to 2.7, reflecting a market where sellers generally have elevated bargaining power.
Pricing: The median sales price in June was $245,000, an increase of 6.5% from one year ago and an increase of 0.4% from May. The differing sample size (number of residential sales of comparative months) can contribute to statistical volatility, including pricing. ACRE recommends consulting with a local real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood.
Homes sold in June averaged 30 days on the market (DOM), equal to June 2019.
Forecast: June sales were 48 units, or 2.8%, above the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 1,693 sales for the month, while actual sales were 1,741 units. ACRE forecast a total of 8,283 residential sales year-to-date, while there were 7,820 actual sales through June, a difference of 5.6%.
Click here to view the entire monthly report.
NAR commentary: According to the National Association of Realtors (NAR), existing home sales nationwide rebounded at a record pace in June (seasonally adjusted annual rate), suggesting signs of a turnaround after three months of declines. Sales prices continued to rise as the nationwide median sales price increased 3.5% year-over-year, extending the streak of Y/Y price gains to 100 consecutive months.
When addressing the turnaround in sales activity, Lawrence Yun, NAR chief economist, said, “The sales recovery is strong, as buyers were eager to purchase homes and properties that they had been eyeing during the shutdown. This revitalization looks to be sustainable for many months ahead as long as mortgage rates remain low and job gains continue.”
Yun also noted the impact of low inventory conditions, saying, “Home prices rose during the lockdown and could rise even further due to heavy buyer competition and a significant shortage of supply.”
ACRE commentary: Closed sales data from June shows that total residential sales increased 18.7% year-over-year, ending two consecutive months of declines. On the supply side, inventory (properties listed for sale) was tight before the pandemic and continues to be constrained as listings declined 24.7% Y/Y. Limited inventory has played a significant role in supporting sales prices, which continue to trend upward. The median sales price of $193,977 reflects an increase of 7.1% from one year ago and 4.8% from May. Pricing dynamics are driven by the law of supply and demand, always at work moving toward or away from market equilibrium (6 months of supply), at which buyer and seller have equal bargaining power. In June, months of supply was at 2.3.
The Birmingham Area Residential Monthly Report is developed in connection with the Birmingham Association of Realtors.
Editor’s Note: All information in this article reflects data provided to the Alabama Center for Real Estate for June 1-30, 2020. Thus, the performance represented is historical and should not be used as an indicator of future results, particularly considering the impact of COVID-19 on the housing market.