Top 5 Markets for New Construction

Top 5 Markets for New Construction

Topics: Home Building, Research, Residential Real Estate, Research

Markets: Athens (Limestone County), Baldwin County - All, Birmingham Metro, Huntsville-Madison County, Lee County, Statewide

The Alabama Center for Real Estate created the following rankings based on new construction as a percentage of total residential sales during March.

1.  Athens: 39.8 percent

2.  Lee County: 27.8 percent

3.  Huntsville: 26.5 percent

4.  Baldwin County: 23.6 percent

5.  Birmingham: 14.3 percent

 

March New Construction Recap

Statewide Overview: Alabama’s existing-home market had a record year in 2018 as total sales surpassed the high water mark set in 2005, and the state’s new construction market is following a similar trajectory. Total new construction sales have grown year-over-year in 38 of the past 41 months, an impressive streak going back to November 2015. During March, sales increased 4.7 percent from 723 in March 2018 to 757 in March 2019. Although the statewide new construction market posted significant inventory gains this time last year, inventory is currently trending downwards. New construction listings have declined year-over-year in 7 of the last 9 months. This trend is similar to the statewide existing-home market (49 consecutive months of year-over-year inventory declines) but to a lesser degree. Even with tightening inventory during March, new construction sales prices stabilized somewhat, dropping 1 percent year-over-year. Year-to-date, however, the median sales price of new construction sales in Alabama increased 4.5 percent from $231,200 in 2018 to $241,700 in 2019. Stay tuned to see if the state’s new construction and resale markets continue to surge as we approach summer.    

Athens: Total sales of newly constructed residential housing in the Athens area increased 39.8 percent YoY from 52 to 66 closed transactions. The March median sales price decreased 0.7 percent YoY from $265,410 to $263,463. Mirroring statewide trends in the new construction market but to a greater degree, inventory decreased 33.5 percent from 167 listings one year ago to 111 in March. Months of new construction supply decreased from 3.2 to 1.7, and average days on market decreased from 55 to 51, the lowest in the state. New construction represented 39.8 percent of all residential transactions in the area during March, up from 36.4 percent one year ago.

Lee County: Total sales of newly constructed residential housing in Lee County decreased 1.9 percent YoY from 53 to 52 closed transactions. The March median sales price increased 6.8 percent YoY from $298,410 to $318,728. Going against statewide trends in the new construction market, inventory increased an impressive 31.7 percent from 208 listings one year ago to 274 in March. Months of new construction supply increased from 3.9 to 5.3, and average days on market increased from 109 to 172. New construction represented 27.8 percent of all residential transactions in the area during March, up from 26.4 percent one year ago.  

Huntsville: Although Huntsville was second to Birmingham in March as Alabama’s largest new construction market in terms of total sales, the Huntsville metro area (Madison and Limestone Counties) is consistently ahead of the Birmingham metro area in total new construction sales. Sales were flat in March as they were equal to one year ago (151 closed transactions). The March median sales price decreased 4.5 percent YoY from $252,630 to $241,270. Mirroring statewide trends in the new construction market, inventory decreased 21.1 percent from 517 listings one year ago to 408 in March. Months of new construction supply decreased from 3.4 to 2.7, and average days on market decreased from 85 to 68, the second lowest in the state. New construction represented 26.5 percent of all residential transactions in the area during March, up from 23.4 percent one year ago.   

Baldwin County: Total sales of newly constructed residential housing in Baldwin County increased 0.7 percent YoY from 148 to 149 closed transactions. The March median sales price decreased 9.5 percent YoY from $253,987 to $229,900. Mirroring statewide trends in the new construction market, inventory decreased 1.3 percent from 630 listings one year ago to 622 in March. Months of new construction supply decreased from 4.3 to 4.2, and average days on market decreased from 140 to 117. New construction represented 23.6 percent of all residential transactions in the area during March, up from 23.3 percent one year ago.

Birmingham: Not surprisingly, the Birmingham area lead the state in total new construction sales during March, which increased an impressive 26 percent YoY from 154 to 194 closed transactions. The March median sales price decreased 4.3 percent YoY from $272,270 to $260,500. Going against statewide trends in the new construction market, inventory increased 8 percent from 838 listings one year ago to 905 in March. Months of new construction supply decreased from 5.4 to 4.7 months. Average days on market is not reported for the Birmingham area. New construction represented 14.3 percent of all residential transactions in the area during March, up from 10.9 percent one year ago.  

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