It’s a wrap, the numbers are in from across the state. Alabama residential sales in 2012 improved by 5.9 percent from 2011. This represents the second consecutive year of positive sales growth for Alabama’s residential real estate industry. In 2011, sales grew by 2 percent ending a six year period of declining sales including 2010 that saw sales decline 4 percent.
Across Alabama in 2012, 72 percent of local markets reported positive sales growth compared to last year. This is also an improvement from the prior year where 56 percent of local markets experienced positive sales growth.
Supply: The statewide housing inventory in December was 30,869 units, a decrease of 4.6 percent from December 2011 and 18.6 percent below the month of December’s peak in 2007 (37,916 units)
There were 10.8 months of housing supply (6 months considered equilibrium) in December 2012 versus 11.3 months of supply in December 2011, a favorable decline of 3.9 percent.
December inventory in Alabama also experienced a 4.3 percent decrease when compared to the prior month. This trend is consistent with historical data indicating that December inventory on average (’07-’11) traditionally decreases from the month of November by 4.3 percent.
Demand: In December, Alabama residential sales were outperformed by the US market which showed an increase of 12.8 percent from the prior year, according to the National Association of REALTORS (NAR). NAR also reported that the South region sales were up 14.7 percent from last December. Investors accounted for 21 percent of nationwide sales while 29 percent were all-cash sales and 30 percent were first-time home buyers (40% in typical market).
November statewide residential sales dropped 7.2 percent from the prior month. This movement is higher than historical data that indicates that November sales, on average (’07-’11), decrease from the month of October by 3.7 percent. In comparison, US sales rose 2.1 percent from last month while the South region also improved by 2.1 percent from the prior month.
Pricing: The statewide median selling price in December was $134,661, an increase of 16.2 percent from last December. This figure represents an increase of 12.1 percent when compared to the prior month. Historical data (’07-’11) reflects that the December median selling price traditionally decreases from the month of November by .4 percent. Nationally, NAR states that distressed homes – foreclosures and short sales – accounted for 24 percent of December sales (12 percent were foreclosures and 12 percent were short sales), Foreclosures typically sold for an average 17 percent below market price in December, while short sales were discounted 16 percent.
Local Results: 11 out of the 25 local reporting associations (44% – this is down from 64% in November) reflect sales gains from last December. In 2012, sales in metro markets (up 8% from last year) outperformed both rural (up 5%) and midsize areas (up 1%). All 5 major metro areas representing 70% of Alabama sales have positive year-over-year growth rates except Tuscaloosa (down .4%, primarily due to increased storm-related demand in 2011).