The Huntsville Area Association of Realtors (HAAR) has released its monthly report for the month of September.

The study shows that the average sales price for single family homes decreased from $371,000 to $370,000. However, the median figure for single family homes decreased down to $304,000, which is considerably lower than the national median of $394,000 for the same month.

Sales were down in the Huntsville/Madison County market compared to September of the previous year, with sales down to 622 to 753.

The number of homes on the market increased, up to 1807 from 1496. The average days on homes spent on the market doubled from 14 to 29.

HAAR President Chris Hulser-Hoover gave a statement to accompany the monthly report, which focused on housing affordability.

“Providing affordable and attainable housing is the focus at HAAR. New home construction scheduled throughout 2023 in North Alabama will boost inventory, giving first-time buyers more options in the $250,000 to $300,000 price range. We continue to work actively with the City of Huntsville on Housing Affordability.” said HAAR President Chris Hulser-Hoover.

This statement comes on the heels of the Huntsville City Council announcing the creation of a new position for managing housing affordability.

“There’s a music position we’ve hired as a director, a preservation director, long-range planning director, and a number of directors in the city we consider important to us to help the vibrancy and help in the city,” said Huntsville City Councilmember Devyn Keith. “To think we don’t need a homeless advocacy and affordable housing director would be negligible for the next ten years.”

This new position would consolidate information and coordinate with developers and financial backers to facilitate future development to meet the needs of Huntsville’s growing population.

Housing affordability remains a major issue, both here in Huntsville and across the United States as a whole.

According to a new report from the National Association of Realtors, sales of existing homes dropped 2% over September, to a total of 3.96 million units. This represents the lowest figure since October of 2010.

This drop in sales can be attributed to the potent combination of soaring interest rates and high prices. Many people are unable to afford a home at all at this time, and of those who can, many are opting to hold off on purchasing one until the market is more favorable to them.

This combination has led some homeowners to pursue Adjustable Rate Mortgages (ARMs) as a potential solution. According to the Mortgage Bankers Association, applications for 5/1 ARMs during the first week of October rose by 32.5% from the previous month. The effective rate for a 5/1 ARM averaged 6.66%, compared to 7.49% for a traditional 30-year fixed rate mortgage taken out during that same time.

During that first week of October, ARM applicants represented 9.2% of all prospective borrowers, the highest percentage since November of 2022.

As always, the Huntsville Business Journal strongly recommends consulting with professional realtors and financial officers in order to fully understand all aspects of such transactions.

Keep reading the Huntsville Business Journal for more updates on the real estate market, both locally and nationally, as developments occur.