The Central Alabama real estate market continues among the most affordable and generally stable markets in the US. The average home in our Central Alabama area sold for $171,272 in September.¹ It appears that sold prices may be on the rise, about 3.3% more in September compared to just last month (August 2018), BUT they are still under 1% higher than September last year 2017.
While many other parts of the country continue to experience major price increases along with lack of inventory, the Central Alabama market overall is more in balance with realatively stable prices adjusting for seasonal variation and a hint of a sellers market–maintaining close to a 5 month supply of homes. Average days on the market in the Central Alabama region had been hoovering around 90 days for quite some time, but this past month, it edged up to 102 days. Over half (57%) of the homes sold in under 90 days, but nearly 18% of homes that closed in September were on the market over six months.¹ It is possible that as inventories are lower, additional properties that have been on the market longer periods are selling and causing the average days on market calculation to increase.
Data from Montgomery Area Association of Realtors, MAAR MLS only, September 2018 as of October 1, 2018.
When looking at market trends it’s important to look at year to date information and to compare the same time periods in previous years. We are all familiar with the impact of seasonal and even monthly variations on both housing supply and buyers in the marketplace. In our area, our home sale activity varies seasonally, but not as dramatically as many areas of the country. According to the data through August, the actual Montgomery area home sales are closely aligning with the Alabama Center for Real Estate (ACRE), Culverhouse College of Business at the University of Alabama monthly projections for homes sold in the Montgomery area, suggesting a relatively stable and predictible market²:
ACRE data shows that January and February are expected to have the fewest home sales in our area. While this year started out slightly below the monthly projections, several of the following months exceeded the projections. You can also see from the monthly data and projections that the lowest number of sold homes occurs early in the year, with the increase in spring market activity in 2018 beginning as early as March and peaking in June. By the end of August, 3226 residential units were actually sold, slightly over the projected year to date of 3192 by 34 units. Projections from September through December 2018 reveal an expected seasonal decline in homes to be sold, with a projected 1445 additional homes sold before the end of the year. As we close out 2018, we will keep an eye on how the market actually performs and update on expectations for 2019.
What does this mean?
Although our area real estate market is relatively stable, there is a tendency toward a seller’s market and relatively low inventories with slightly increasing prices in the Montgomery area. Regardless of the time of year, there is an active real estate market with buyers looking to purchase a home year round. If you are thinking about selling in our area, the best time to sell is when you are ready!
For buyers, this is a great time to make a move to buy a home. Prices here are relatively steady and there has not been the pricing frenzy and multi-offer competitive buying situation that have been experienced in many areas of the country causing prices to go incredibly high. This means that you can place an offer to purchase a home with more confidence that a reasonable offer will be accepted and be in a position to build equity for the future. While no one can guarantee which direction the market will actually go, the Central Alabama area market is relatively stable and affordable.
Keep in mind that markets vary by neighborhood. If you are interested in a more detailed breakdown of market trends by a particular zip code or neighborhood of interest , let me know and I’ll send you a free report: Free Market Report for Your Neighborhood!
¹Montgomery Area Association of Realtors, Multiple Listing Service, September 2018 residential sales data (pulled October 1, 2018).
²The University of Alabama, Culverhouse College of Commerce, Alabama Center for Real Estate, Montgomery Area Real Estate Sales Forecast, August 2018 update.