Sales: According to the Montgomery Area Association of Realtors, April home sales in the area decreased 19.8% year-over-year from 602 to 483 closed transactions. Going against seasonal trends, sales decreased 9.2% from March. Sales are now down 6.9% year-to-date. Two more resources to review: Quarterly Report and Annual Report.
For all Montgomery-area housing data, click here.
Inventory: April listings (541) increased 2.9% from March and declined 21.5% from one year ago. At the current sales pace, all the active inventory on the market would sell in 1.1 months, up from 1 month in March and the same amount of time as in April 2021.
Pricing: The median sales price in April was $225,000, an increase of 16.7% from one year ago and an increase of 4.7% from March. 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 April averaged 49 days on the market, selling 20 days faster than in April 2021.
Forecast: April sales were 81 units, or 14.3%, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 564 sales for the month, while actual sales were 483 units. ACRE forecast a total of 1,981 residential sales year-to-date, while there were 1,842 actual sales through April, a difference of 7%.
New construction: The 77 new homes sold represent 15.9% of all residential sales in the area in April. Total sales decreased 10% year-over-year. The median sales price in April was $332,255, a decrease of 1.6% from one year ago and 8.7% from March. New homes sold in an average of 66 days, 33 days faster than in April 2021.
Statewide summary: Home sales cooled off in April, falling 6% from one year ago. Fast-rising mortgage rates, rising home prices and inflation have resulted in a slower pace of buyer activity. More declines are expected in the coming months as home sales are likely to return to pre-pandemic levels. Slowing home sales will encourage home price growth to readjust toward more sustainable rates while also encouraging a gradual increase in supply.
Home sales prices continue to trend upward, with the statewide median sales price reaching the highest level on record in April ($234,100), an increase of 16% from one year ago. As demand slows, price growth is expected to moderate to the 8-10% range by the fourth quarter of 2022.
After reaching a record low in February, inventory is beginning to trend upward. April listings increased 24.2% from March and 4.3% from one year ago, the first year-over-year inventory gain at the statewide level in more than seven years. Inventory is expected to continue growing, but at a slow pace as sales activity cools. The imbalance between supply and demand, however, continued in April with just 1.5 months of supply, while a balanced market has 4-6 months of supply.
National summary: According to the National Association of Realtors (NAR), existing home sales declined for the third consecutive month in April, falling 2.4% from March (seasonally adjusted annual rate). Sales increased from the prior month in the Northeast and Midwest, while they slowed in the South and West regions. Year-over-year, national home sales declined 5.9%.
The median sales price for all housing types was $391,200, rising 14.8% year-over-year and marking 122 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 1,030,000 listings at the end of April, up 10.8% from March 2021 and down 10.4% from 1.15 million listings one year ago. April’s 2.2 months of supply increased from 1.9 months during March but is down slightly from 2.3 months one year ago.
Lawrence Yun, chief economist for NAR, said, “Higher home prices and sharply higher mortgage rates have reduced buyer activity. It looks like more declines are imminent in the upcoming months, and we’ll likely return to the pre-pandemic home sales activity after the remarkable surge over the past two years.”
Yun also commented on the rare market conditions. “The market is quite unusual as sales are coming down but listed homes are still selling swiftly, and home prices are much higher than a year ago,” he said.
Yun also said, “An increasing number of buyers with short tenure expectations could opt for five-year adjustable-rate mortgages, thereby assuring fixed payments over five years because of the rate reset. The cash buyers, not impacted by mortgage rate changes, remain elevated.”
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The Montgomery Residential Monthly Report is developed in connection with the Montgomery Area Association of Realtors.