Huntsville market defies post-pandemic regional bust cycle

The June Mortgage Monitor Report released by the Intercontinental Exchange (ICE) shows that many of the Southern real estate markets, which saw a boom during the Covid-19 Pandemic, have begun to bust as the pace of buying has slowed and surplus inventory reaches or even exceeds pre-pandemic levels. 

Austin, Texas, for example, saw a 0.25% decrease in housing prices over the month of April, while the National Association of Realtors (NAR) reports that Florida cities, such as Cape Coral, have seen a decrease in average housing prices of 4.4%. 

“Really the storyline of this spring has been elevated interest rates, less affordability, [and] less demand that is allowing inventory to grow across the country and you’re seeing that by and large nationwide,” Andy Walden, Vice President of Enterprise Research Strategy at ICE, said in a video posted last week. 

Further exacerbating the decline in housing prices for these markets has been the steadily-increasing insurance premiums in Florida and Texas, where natural disasters have consistently driven premiums above the national average, a trend that shows no signs of stopping anytime soon.  

In contrast, a report compiled by the Huntsville Area Association of Realtors (HAAR), dated to June 15, shows that market activity in the Huntsville/Madison County market is still quite brisk, despite the persistent high interest rates. 

Inventory of both single family units and townhouse/condo units continued to increase, by 31.7% for single family homes and 92% for townhouse units. 

Pending sales of single family units increased by 13.6%, while townhouse units saw a 9.1% decrease. 

However, new listings of townhouse units increased by 4.2%, while single family units saw a 17.4% increase in new listings. 

These indicators show that the Huntsville real estate market remains relatively well-insulated from the boom-bust cycle that other markets in the South saw during the pandemic and its aftermath. Demand to live and work in and around Huntsville remains high, making real estate in our regional market a fairly stable investment compared to many of our neighbors. 

The Huntsville Business Journal will continue to report on developments in the real estate market, both nationally and here at home.