Alabama’s real estate market continues growth in November
Sales: According to the Alabama Association of REALTORS, November home sales in the state increased 23.3% year-over-year from 4,635 to 5,713 closed transactions. Following seasonal trends, sales decreased 17.1% from October. Statewide home sales are now up 11.9% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all statewide housing data, click here.
Inventory: Homes listed for sale decreased 33.8% from 20,024 listings one year ago to 13,256 in November, marking 69 consecutive months of year-over-year inventory declines. Months of supply (inventory to sales ratio) dropped from 4.3 to 2.3, reflecting a market where sellers generally have elevated bargaining power.
Pricing: The statewide median sales price in November was $194,705, an increase of 14.9% from one year ago and a decrease of 2.4% from October. 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 November averaged 68 days on the market (DOM), 24 days faster than one year ago.
Forecast: November sales were 1,002 units or 21.3% above the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 4,711 sales for the month, while actual sales were 5,713 units. ACRE forecast a total of 60,610 residential sales year-to-date, while there were 66,186 actual sales through November, a difference of 9.2%.
New Construction: The 854 new homes sold represent 14.9% of all residential sales in the area in November. Total sales increased 19.8% year-over-year, extending the area’s streak of Y/Y gains in new home sales to 17 consecutive months. The median sales price in November was $267,508, an increase of 11.6% from one year ago and an increase of 2.1% from October. New homes sold in an average of 56 days, 17 days faster than November 2019.
NAR commentary: According to the National Association of Realtors (NAR), existing home sales nationwide decreased 2.5% from October (seasonally adjusted annual rate), ending 5 consecutive months of gains. However, sales did increase significantly from one year ago, rising 25.8%. Sales prices continued to grow at higher rates than before the pandemic, rising almost 15% year-over-year.
Lawrence Yun, chief economist for NAR said, “Home sales in November took a marginal step back, but sales for all of 2020 are already on pace to surpass last year's levels.Given the COVID-19 pandemic, it's amazing that the housing sector is outperforming expectations. Circumstances are far from being back to the pre-pandemic normal. However, the latest stimulus package and with the vaccine distribution underway, and a very strong demand for homeownership still prevalent, robust growth is forthcoming for 2021."
ACRE commentary: Home sales in Alabama increased for the sixth consecutive month in November, rising 23.3% year-over-year. The strong rebound in sales activity during the summer months has extended into the fall, with many buyers looking for more housing space due to more time spent at home. Low mortgage rates also played a significant role as they helped offset rising home sales prices, which increased almost 15% Y/Y in November. Sales prices continue to grow at a faster rate than before the pandemic, which could motivate more potential sellers to list their homes going forward. Tight inventory has played a large role in driving sales prices upwards, with total listings down 33.8% in November.
Click here to view the entire monthly report.
The Alabama Residential Monthly Report is developed in connection with the Alabama Association of Realtors.
Editor's Note: All information in this article reflects data provided to the Alabama Center for Real Estate for the time period November 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.