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 75 residential sales in the Wiregrass region during February, a 2.7 percent increase from one year ago. Existing single-family homes accounted for 91 percent of all residential sales, while 9 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: February sales were exactly aligned with the Alabama Center for Real Estate’s (ACRE) monthly forecast of 75 closed transactions. ACRE projected 141 total sales in the area year-to-date, and there were 141 actual sales through February. 

Supply: Wiregrass area housing inventory totaled 734 listings in February, an increase of 3.2 percent from one year ago. The Wiregrass region had 58 newly constructed homes listed for sale in February and 676 existing single-family homes listed. Inventory in the region increased 3.5 percent from the previous month.

Demand: February residential sales were up 10.3 percent from the prior month. This rise in sales is not typical, as February sales data from 2013-17 indicate that February sales on average decrease from January by 9.9 percent. The average number of days on the market until a listing sold was 175 days, a 17.4 percent increase from 149 days on the market one year ago. This statistic has seen much improvement, though, since peaking in January 2012 at 213 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 February was 9.8 months of housing supply, down from 10.4 months of supply one month ago and up from 9.7 months of supply one year ago. In other words, at the February sales pace it would take 9.8 months to absorb the current inventory for sale.

Pricing: The Wiregrass area median sales price in February was $110,500, an increase of 12.8 percent from one year ago and a 7.9 percent decrease 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: The 10-year treasury is a crucial indicator of economic expansion. As of March 1, 2018, the 10-year treasury stood at 2.88 percent, a slight increase from last month’s rate of 2.86 percent. Mortgage rates also experienced a slight increase recently as the current rate on a 30-year fixed-rate mortgage is 4.57 percent, up from 4.38 percent one month ago. As the economy continues to strengthen, people will have more money in their pockets with the intent to spend. This increase in spending will most likely create higher stock prices and lower bond prices. With this increase of confidence in the market, mortgage interest rates can be expected to increase.

The National Association of Home Builders (NAHB) produces economic analyses of the home-building industry based on government data. The Housing Market Index (HMI) depicts market conditions for the sale of new homes. The HMI ranges from 0 to 100; a rate greater than 50 represents good sales conditions.

The HMI in the South has stayed relatively steady in the past few months with a score of 73. However, the HMI is lower in some regions of the United States, such as the Northeast, which has a rate of 56. The West has a higher HMI of 77, and a better market for good housing conditions.

The Federal Housing Finance Agency uses the House Price Index (HPI) to measure the average price changes in repeat sales or refinancing on the same properties. The FHFA’s national HPI was up 6.7 percent from the previous year compared to Alabama, which has increased from the previous year by 5.6 percent. The HPI rose in all 49 states except for Mississippi.

Compared to the national housing market conditions, Alabama’s real estate market has been showing improvement. Although total residential sales in Alabama decreased 2.3 percent from January 2017, the statewide median sales price increased 2.3 percent from January 2017. Statewide, homes in Alabama are selling much more quickly than in recent years as the average days on the market decreased 19.6 percent from one year ago.

Click here to view more graphs from the Wiregrass Region February 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.