According to a report from the Alabama Center for Real Estate (ACRE), Alabama’s hot housing market is beginning to cool down. Data shows that rising mortgage rates are causing potential buyers to pump the brakes on buying a house. Read on for details.
Alabama’s housing market
ACRE and the Alabama Association of Realtors have compiled and analyzed data on the housing market, both in Alabama and across the country. To kick things off, let’s take a look at what this means for the current state of our housing market here in Alabama.
Overall, ACRE reports that home sales in the state declined in July as rising mortgage rates sidelined potential buyers. The statewide median sales price in July was $247,706, a record high. Sales declined 18.2% year-over-year and are down 5.6% year-to-date. According to the report, buyer demand has returned to pre-Covid levels, with July sales at 4.8% below the 5-year average.
Additional declines in home sales are expected with a 5-10% slowdown from last year’s pace. Plus, much-needed inventory arrived in July with statewide listings rising 8.1% from June and 24.7% from one year ago.
Looking to buy? ACRE recommends consulting with a local real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood.
How do we compare nationwide?
Alabama isn’t the only place experiencing these trends. According to the National Association of Realtors (NAR), existing home sales are declining for the sixth month in a row nationwide, with all four regions of the country reporting month-over-month declines.
The median sales price for all housing types increased 10.8% year over year to $403,800. Even with this increase in pricing, properties sold in an average of just 14 days, the fastest pace on record.
NAR also reports that inventory is slowly trending upwards from the lows seen during the post-pandemic housing boom.
“We’re witnessing a housing recession in terms of declining home sales and home building. However, it’s not a recession in home prices. Inventory remains tight and prices continue to rise nationally with nearly 40% of homes still commanding the full list price.”Lawrence Yun, cheif economist, National Association of Realtors
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