Sales: According to ValleyMLS.com, February home sales in the Huntsville area decreased 2.6% year-over-year (Y/Y) from 589 to 574 closed transactions. Sales increased 9.5% from January. Sales are down 9% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all Huntsville-area housing data, click here.
Inventory: February listings (511) decreased 6.6% from January and 6.9% from one year ago. At the current sales pace, all the active inventory on the market would sell in 0.9 month, down from 1 month in January and the same as last February. The equilibrium point where buyers and sellers have roughly equal bargaining power is 6 months of supply.
Pricing: The median sales price in February was $323,992, a record high and an increase of 21.7% from one year ago and 4.5% from January. 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 February averaged 11 days on the market, selling nine days faster than in February 2021.
Forecast: February sales were 94 units, or 14.1%, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 668 sales for the month, while actual sales were 574 units. ACRE forecast a total of 1,283 sales in the area year-to-date, while there were 1,098 actual sales through February, a difference of 14.4%.
New construction: The 220 new homes sold represent 38.3% of all residential sales in the area in February. Total sales increased 25.7% year-over-year. The median sales price in February was $349,500, an increase of 2.8% from January and an increase of 26.9% from one year ago.
NAR commentary: According to the National Association of Realtors (NAR), existing home sales declined in February, falling 7.2% from January (seasonally adjusted annual rate). All four regions of the country reported month-over-month declines. Home sales also declined from one year ago, dropping 2.4% year-over-year. The median sales price for all housing types was $357,300, rising 15% year-over-year and marking 120 consecutive months of year-over-year gains. Rising home prices are largely a result of low housing inventory amid sustained demand. Existing home inventory totaled 870,000 listings at the end of February, up 2.4% from January and down 15.5% from 1.03 million listings one year ago. February’s 1.7 months of supply increased from 1.6 during the prior month but decreased from 2 months one year ago.
Lawrence Yun, chief economist for NAR, said, “Housing affordability continues to be a major challenge, as buyers are getting a double whammy: rising mortgage rates and sustained price increases. Some who had previously qualified at a 3% mortgage rate are no longer able to buy at the 4% rate.”
Yun also said he expects sales to slow down slightly because of higher mortgage rates and rising prices. “The sharp jump in mortgage rates and increasing inflation is taking a heavy toll on consumers’ savings. However, I expect the pace of price appreciation to slow as demand cools and as supply improves somewhat due to more home construction.”
ACRE commentary: Home sales in Alabama grew slightly in February, rising 2.9% from one year ago. Sixteen of the 24 markets reporting sales data to ACRE reported year-over-year sales gains.
The statewide median sales price gained 18.3% Y/Y in February as the ongoing imbalance between supply and demand continued. Inventory declined to 7,403 listings, a record low and a decrease of 25.6% from one year ago. Unsold inventory is at 1.4 months of supply, down from 1.5 in January and 1.9 months in February 2021.
Click here to view the entire monthly report.
The Huntsville Area Residential Monthly Report is developed in connection with the Huntsville Area Association of Realtors.
Editor’s note: All information in this article reflects data provided to the Alabama Center for Real Estate for Feb. 1-28. Thus, the performance represented is historical and should not be used as an indicator of future results.