Huntsville/Madison County residential sales reached 4.776 units in 2012. There were 504 more housing units sold compared to the prior year. Restated, residential sales improved by 11.8 percent which is only slightly behind Montgomery, Alabama’s top metro market that experienced sales growth of 12.1 percent in 2012.
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Supply: Huntsville housing inventory totaled 2,712 units, an increase of 5.4 percent from last December. The inventory-to-sales ratio in December stood at 7.5 months of housing supply, unfortunately this reflects an increase of 13.3% from 6.6 months in December 2011. This figure still represents the best inventory balance between supply & demand in Alabama. December inventory in Huntsville experienced a 5.1 percent decrease when compared to the prior month. This direction is consistent with historical data trends that indicates December inventory on average (’07-’11) traditionally decreases from the month of November by 6.4 percent.
Demand: Existing single family home sales accounted for 65 percent (compared to 61% in Dec’11) of total sales, new homes sales accounted for 33 percent (down from 35% in Dec’11) while condos were 2 percent of sales (down from 4% in Dec’11).
Residential sales are seasonal, typically peaking during the 2nd quarter(summer) and then gradually trending on a downward slope through the next three quarters. Historical Huntsville data reflects that December sales, on average (’07-’11), declined from the month of November by .3 percent. Huntsville residential sales in December decreased 10.8 percent from the prior month.
Pricing: The Huntsville median selling price in December was $184,000, an increase of 12.2 percent from last December. This figure also represents an increase of 8.3 percent when compared to the prior month. Historical data (’07-’11) indicates that the December median selling price traditionally decreases from the month of November by 1.0 percent so this improvement is favorable news for the market.
Real estate sales are seasonal and the sales pace slows during the winter quarters resulting in a higher degree of statistical volatility. With that said, through November seventy-six percent (19 of 25) of the local housing markets across the State have experienced year-to-date sales growth from 2011 and that is welcome news for Alabama consumers as well our state’s real estate community. As for the latest economic forecast entering the new year, according to Global Insight’s most recent short-term outlook, “The economy still has only weak forward momentum. We expect growth in the 1.5–2.0% range in the fourth quarter. Some underlying fundamentals are improving—most importantly, housing. We expect that the fog of uncertainty (US fiscal policy) will gradually clear during 2013, setting the stage for a broad-based improvement in economic growth in 2014.”