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House Prices Continue to Rise; Availability Narrows

The price of housing continues to rise in the Huntsville area and houses are on the market for just a little more than two weeks, according to the latest report from the Alabama Center for Real Estate.

The average sales price in Huntsville for October was $284,489, a 14 percent increase from October 2019 and a slight increase over September’s average of $283,868.

“Historical data indicates that October average sales prices on average (2015-19) increase by 1.3 percent from September,” the report said. “The current month’s average price increased 0.2 percent from the prior month.”

The ACRE report also showed houses are on the mark for just 16 days – one less day than September and 15 days less than last October. It is a trend that ACRE said is likely to continue.

“The 5-year days-on-market average (2015-19) for the month of October is 64 days, which is 48 days above current results,” ACRE said. “Average DOM is anticipated to remain within the current range (15 – 65 days) for the foreseeable future.”

The number of houses available also continues to drop compared to a year ago and to this past September.

There were 832 houses listed for sale in October, the report said. It is a 28.7 percent decrease from the 1,167 houses that were available last October and an 8.6 percent drop from the 910 houses on the market in September of this year.

Broken down, there were 410 single-family houses available in October, compared to 778 in October 2019 and the number of new-built houses dropped from 509 in October 2019 to 422 last month. The report showed there were no condos listed for sale last month, compared to 21 a year ago.

“Historical data indicates that October inventory on average (2015-19) decreases 2.3 percent from September,” ACRE said. “The current month’s inventory decreased 8.6 percent from last month’s total of 910 homes.”

 

 

Area Housing Market Builds on Summer Success; Sales, Prices Up; Inventory Continues to Dwindle

The Huntsville area housing market continues to show its resilience in the wake of the pandemic.

The number of house sales and prices in the third quarter increased over the third quarter last year while the number of available houses continues to fall, compared to the same period in 2019.

The latest quarterly Huntsville Area of Real Estate Economic Report by the Huntsville Area Association of Realtors illustrates the strength of the local market.

“This summer, we reported a successful quarter through the pandemic largely because of the responsible and dedicated work of our Realtor members in our communities,” said HAAR President Sha Jarboe.“Our latest report shows higher-than-usual sales activity for this time of a typical year. We are thankful for our partnership with the UAH College of Business to offer this analysis to the public.”

According to the report:

  • Residential real estate prices continue to rise while the number of homes sold remains at a record level. The median sales price climbed to $254,991 in the third quarter of this year, some $33,193 above the median sales price of $221,798 in the third quarter of 2019. Meanwhile, there were 2,621 houses sold with 759 sales pending compared to 2,250 sales and 595 pending in the third quarter last year.
  • Inventory continues to register at historic lows, falling in every price range this quarter. There were 910 houses available at the end of the third quarter.  There were 926 homes available at the end of June (second quarter) and 1,226 at the end of the third quarter 2019. Of the homes available, there were only 40 homes priced below $150,000.  The greatest number of homes listed for sale was 227 in the $350,000-$500,000 price range.  The $200,000-$250,000 price range had the second most with 170 homes listed which was down from 207 homes in the second quarter.
  • Houses stayed on the market for less than three weeks (a record low of 19 days) in the third quarter, half as long as this time last year.
  • Months of Supply fell to less than one month (24 days) compared to nearly two months at the end of the third quarter in 2019.
  • 17 homes valued more than $800,000 were sold in September 2020, contributing to a monthly sales total double that of any other month since 2010 when this data was first recorded by UAH.

 

 

Huntsville Housing Sales Up 28% Over Year Ago; Inventory Continues to Dwindle

In the midst of the pandemic, people continue to look for and buy houses in the Huntsville area. But the number of houses available continues to dwindle.

The latest figures from the Alabama Center for Real Estate bear that out.

There were 874 houses sold in Huntsville last month, a 28.7 percent increase over the 679 houses sold in September 2019, ACRE said in its monthly report.

Huntsville’s inventory of houses listed for sale in September decreased by 316 when compared to the same period last year. The number also decreased from 963 houses in August to 910 houses available in September – a 5.5 percent drop. The houses available included 478 existing single-family residences, 426 “new builds” and six condos. In September 2019, there were 1,226 houses available.

“Historical data indicates that September inventory on average (2015-19) decreases 1.5 percent from August,” according to the ACRE report. “The current month’s (September) inventory decreased 5.5 percent from last month’s total of 963 homes.”

For home sales, the increase is magnified by the quarterly comparison, as well. Residential sales for the third quarter of 2020 totaled 2,621 units, representing an increase of 11.5 percent when compared to 2,350 units that were sold in the third quarter of 2019.

The number of houses sold in September is also an increase over August’s 818 residential sales, which is out of the norm.

“Historical data indicates that September residential sales on average (2015-19) decrease from August by 9.2 percent,” the report said. “This month’s (September) sales increased 6.8 percent from the prior month.”

However, the median sales price for homes in September – while up over a year ago by 12.8 percent – were down from August by 4.6 percent. In September, the median sales price was $251,432; August’s median sales price was $263,640.

“Historical data indicates that September median sales prices on average (2015-19) decrease 0.9 percent from August,” the ACRE report said. “The current month’s median price decreased 4.6 percent from the previous month.”

The average sales price was also down from September to August, which is normal, but just by 1 percent.

“Historical data indicates that September average sales prices on average (2015-19) decrease by 2.9 percent from August,” the report said. “The current month’s average price decreased 1 percent from the prior month.”

Houses are also on the market for just 17 days in September, a drop from 18 days in August and a decrease of 17 days from 34 in September 2019.

“Average days on the market is anticipated to remain within the current range (15 – 65 days) for the foreseeable future,” ACRE said.

Realtors Host Webinars on Property Vacancy, Abandonment

The Huntsville Area Association of Realtors is engaged in efforts to connect local officials with national policy experts to drive conversations on property vacancy and abandonment prevention. Stabilizing and Revitalizing Neighborhoods in the COVID-19 Era, a multipart series hosted by the National Association of Realtors, is bringing together Realtors and policymakers from across the country to highlight systems that affect vacancy and abandonment and to discuss early intervention strategies that can be employed in the aftermath of the COVID-19 pandemic.

“Several Madison County neighborhoods have faced tremendous stress and economic pressure as a result of this pandemic, and the Huntsville Area Association of Realtors have made it their mission to ensure our community can rebuild and recover as quickly as possible,” said Sha Jarboe, HAAR President “These educational opportunities ensure our members can lead conversations to solve our region’s most complex problems.”

The series is part of NAR’s Transforming Neighborhoods program, which offers Realtors – alongside local community partners – the opportunity to comprehensively explore the underlying factors keeping vacant, abandoned and deteriorated properties “stuck” in decline while examining ways to rehabilitate buildings and create more vibrant communities.

 Visit this link for registration and other information on the webinar series, which is scheduled as follows: Code Enforcement – A Tool for Preventing Vacancy and Abandonment,  Aug. 25; 1 p.m.; Transferring Vacant and Abandoned Properties, Sept. 1, 1 p.m.; and Land Banking – Returning Properties to Productive Use,  Sept. 8, 1 p.m.

Madison County Housing Market Booms Despite Pre-COVID Shortages

Before the coronavirus pandemic, the only things obstructing regional residential growth was the construction industry labor shortage and a desperate shortage of housing inventory. 

Still, during the pandemic, there is nothing – at least nothing new – slowing the residential housing market in North Alabama. Not a virus, not consumers, not builders, not banks, not regulation, and not the economy.

Home-buying and homebuilding are booming.

“We have sold more homes in 2020 than were sold at the same time in 2019,” said Josh McFall, CEO of the Huntsville Area Association of Realtors. “Even amidst the stress of a pandemic and busy housing market there was no slow down, and in fact, the only thing the association has seen take a downturn is housing inventory.

“I don’t even think we can classify the inventory problem as directly related to the pandemic. Beginning in January, we reported the lowest number of homes available for sale in the MLS since the MLS has been keeping track of those records in the mid-1990s.

“Madison County has been the big driver of that because we have the most MLS listings due to the denser population. Inventory is low, but we consistently slide down the entire MLS because our average days on market has also slid down.”

He said the days on market number for North Alabama combined is 42 days but, in Madison County, that number is 26 days and consistently falling.

“I remember five years ago we were reporting 80 or 90 days on the market and here in 2020 and during a pandemic, as of June that number is 26 days,” he said. “So, we had this housing shortage before COVID.”

Last month, around 840 homes were sold in Madison County. Of those, 600 were resales and 230 were new construction. Those 230 are either new construction, a prospect build that was sold, or a custom build that entered the MLS.

“So, what we are saying is, more builders are feeling more confidence in the local economy, so they’re ramping up their building, while at the same time, they have a lot of pressure on them due to the labor shortage and rising supply costs,” McFall said. “But if you look at all the MLS to date, there were 2,307 available homes on the entire market; 926 are in Madison County.”

One-third of houses under construction sell every month so the industry must build a lot of houses to keep up with demand, 

“Sales prices are continuing to tick up from month to month so you can see it is a supply and demand issue,” said McFall.

How are people feeling about buying or building a home during a global pandemic? 

Apparently, completely unfettered.

“Buying a home during COVID-19 was almost no different than our previous purchases,” said David Fields. He and his wife Meredith bought a home right around the highpoint of the pandemic this spring. “Our Realtor was very supportive and took all the necessary precautions including the use of PPE and social distancing. Overall, it was a great experience.”

“We’re getting lots of activity on the housing side of our business,” said Joey Ceci, president of the Breland Companies. Breland’s commercial division is developing the 525-acre Town Madison off I-565.

“At Pike Place at Clift Farm off Balch Road in Madison we already have several townhouses built and sold,” Ceci said. “At Town Madison, they are getting calls from people who are downsizing and who want to get away from a large yard and out from underneath the maintenance of a large house.” 

While Breland builds a variety of housing products, they also contract with homebuilders such as Regent Homes of Nashville. Regent built homes at the Village of Providence and is building The Heights District at Town Madison.

Ceci said all Breland developments, whether they are cottages, single-family homes, or townhouses, are continuing to go up all over North Alabama. The Ledges of Oakdale in Athens, Meadowbrook in Cullman, and The Retreat in Meridianville are selling quickly, while Pebble Creek at River Landing in Madison is sold out.

“The impact on the economy with all these houses being built and sold are keeping home values up for existing homeowners,” Ceci said. “It’s good for our local economy too to be able to say we are not just swapping houses. We were pretty sure all these people would be moving here to take jobs with the FBI and Toyota, and now they are here. There are a lot of new people coming into the area.”

Stone Martin Builders who has developed Celia’s Garden, Allen Acres and Copper Creek in Huntsville, has continued to build throughout the pandemic, according to sales manager Ashley Durham, despite hurdles caused by supply shortages and subcontractor delays. 

“The labor shortage is the building industry’s greatest challenge currently and it has a direct impact on low inventory,” said Durham.  

One of the ways they are addressing the problem is to build strong relationships with subcontractors to help them grow their companies alongside their own.  

“As a growing company, Stone Martin Builders finds value in helping our business partners grow and become great so we can in turn, overcome all types of industry challenges together,” Durham said. “That in addition to seeking opportunities with local technical programs to enhance the workforce, we are all helping each other.” 

One of those technical programs is the North Alabama Homebuilding Academy started by the Huntsville-Madison County Builders Association to address the problem and they have already graduated their second class, even during the pandemic.

The North Alabama Homebuilding Academy trains people to be a homebuilder. Upon graduation, they can work as a contractor in training or in one of the ancillary trades. It was an 18-month endeavor but since January, the Academy has graduated 47 students.

According to Barry Oxley, Executive Officer of the HMCBA, the gap in skilled construction and construction-related labor goes back 30 years to the No Child Left Behind Act when school systems retooled education.

“There was for a long time, the idea that you have to go to college to be successful and as schools began to do away with trade school classes, a stigma developed around trades that said you were not meant for college,” said Oxley. “But the construction industry is made up of a lot of small businesses. If you are a skilled plumber, electrician, window or flooring installer or masonry expert, you do quite well.”

The Academy’s focus is on the 30 percent of school kids who are not able or do not want to go to college. 

The program is an eight-week session with a cap of 18 to 20 students. The fourth session started in early July with 19 students and every class through September is booked to capacity.

“We have been talking about the labor shortage for a long time, so we decided to do something about it,” said Oxley. “They apply through our website and we invite them to an open house. We have been doing those virtually since the shutdowns started.

“We send them an invitation to sign up for a class. It does not cost them anything to attend and we back up the classes with ongoing job fairs where we bring in employers who hire our students. These students are going from minimum wage jobs to making $14 to $16 an hour.”

“We will always strive to build homes efficiently and with great quality … and we will continually seek to find growth opportunities for our organization in the North Alabama market to help offset the housing shortage,” said Stone Martin’s Durham. “We are still accomplishing this goal and our customers remain positive.

“We keep them informed of any affects the pandemic will have on the construction process, and there has been very little disruptions in our builds, so customers continue to be eager and excited about their new home.”

Durham believes it is the commitment their company made to colleagues, customers, and the building team to support one another throughout the crisis. The minute COVID-19 began to challenge the building industry, Stone Martin Builders acted. 

“We identified fellow business owners that may be negatively impacted by the pandemic, and we found ways to become their patrons,” she said. “Many of these business owners were Stone Martin buyers, and we believe it is our duty to give back when we have the ability to do so.”

Some of the steps they took included renting tents from an event resource company whose events had been cancelled. 

“To offset their losses, we used these tents for outdoor closings and information gathering stations to offset the cancellation of open houses in North Alabama,” she said. “Our goal was to find ways to use the product of a struggling customer to help offset the struggles we were having.” 

Durham said some of their processes with customers also changed.

“Upon our first meeting with a customer, we seek to understand the ‘Why?’ they are building a new home,” she said. “COVID changed that process slightly in that we now need to understand how a homeowner is going to function in their new home. 

“COVID is requiring the home be multi-functional and that looks different for every homeowner.”

For instance, they see an increase in the need for home offices, quiet rooms for schooling or reading, functional kitchens with people cooking at home more, and good natural light for being home in day time hours.

“We are creating home plans that meet those needs,” said Durham. 

“We continue to see high demand for housing in Madison County, and especially in Madison,” said Madison Mayor Paul Finley. “The City instituted a Growth Impact Committee in 2017 that documented inventory and anticipated growth. Using this data, the Madison School Board, supported by the City Council, defined 12 mills as the proper number for managing this growth via the property tax referendum.”

The mill rate is the amount of tax payable per dollar of the assessed value of a property.

“This passed in September 2019 and we are now building the needed schools to manage the growth,” he said. 

To support this managed growth, the Madison City Council formulated and instituted a Growth Policy in mid-2019. Town Madison’s residential growth was factored into the Growth Impact Committee’s study and they continue to build out both the residential and retail portions. 

A new townhouse development on Kyser Boulevard is a perfect example of how managed growth can work for all parties. 

“The developer focused on providing 366 townhouse units on industrial property,” Finley said. “Our growth policy dictated that the only way we would change this zoning was if significant city objectives were achieved. 

“Working with the developer and schools, we defined two significant objectives: connecting Westchester Road to Kyser Boulevard allowing school buses a more direct and safer route to Sullivan Street; and extending the Bradford Creek Greenway from Palmer to historic downtown. These two objectives are estimated to cost $4,000,000 and will now be built and paid for by the developer. 

“The developer also agreed to spread the building out to eight years with a 50 unit maximum per year and will not include second stories or a swimming pool, keeping their focus on non-school age purchasers.”

“If you think back 10 years to the recession, Huntsville was not hit as hard as some places, but some of the bigger builders either scaled down or consolidated,” said McFall. “You may notice tracts of land still sitting empty in the back of neighborhoods that were built out for new homes in 2009 and 2010.

“Now they are exploding because builders have bought them. You can drive all over town and see construction in neighborhoods where one builder built the homes in one section of the development, but another builder is completing it. 

“The bottom line is people need a place to live, whether they are moving up or moving down. Marry that with the best interest rates seen in the mortgage industry in a long time, it explains the good housing numbers.”

Madison County Housing Market Still Thriving Despite Pandemic

The Madison County real estate market has maintained its traditional high-volume summer business, despite pandemic-related uncertainty and downturn in other local economic sectors, according to a recent study by the Huntsville Area Association of Realtors.

The group, in partnership with the University of Alabama-Huntsville College of Business, released its second quarter Huntsville Area Real Estate Economics Report, which showed the local housing market continues to avoid most negative consequences of the COVID-19 economic downturn when compared to other sectors of the Madison County economy.

“We are thrilled to see this level of production that we typically see during the summer months,” said Sha Jarboe, 2020 HAAR President. “Not only is it a welcome sign of normalcy, but it shows the hustle of our members while they demonstrate responsible ways of doing business that maintains the health and safety of their clients and themselves.”

The report also showed there was a significant increase in the median sales price at $248,680 from $233,688 in the first quarter. Houses were also on the market an average of 29 days, compared to 45 days this time last year.

While listings are low due to a low inventory of houses, there was an increase of 295 from the first three months of 2020.

The quarterly reports are available at HAAR’s website, HAAR.realtor.

Huntsville Housing Sales Up Nearly 15% Over Year Ago

Though the number of house available for sale is the lowest in years, Huntsville residential sales for the first quarter of this year was nearly 15 percent higher than the first quarter of 2019.

The sales, according to the quarterly report from the Alabama Center for Real Estate, for the first quarter totaled 1,801 units, representing an increase of 14.9 percent when compared to 1,567 units sold in the first quarter of 2019.

“Compared to historical data, first quarter sales are 20.1 percent above the three-year quarterly average and 31.1 percent above the five-year quarterly average,” the report said.

The number of houses available for sale in the first quarter was 845 – a 32.5 percent decrease compared to the first quarter of 2019, when 1,252 houses were available.

And, not only did sales increase, so did the median and average prices – thanks to the low inventory.

The median selling price in Huntsville for the first quarter of 2020 was $233,688, a 12.2 percent increase from the first quarter of 2019’s median selling price of $208,333. The average sales price for the first quarter was $261,455, an 11 percent increase from the first quarter of 2019’s average sales price of $235,610.

“Compared to historical data, the fourth quarter median sales price is 21.1 percent above the three-year quarterly average and 28.3 percent above the five-year quarterly average,” the report said. “The fourth quarter average sales price is 20 percent above the three-year quarterly average and 26.4 percent above the five-year quarterly average.”

The houses that were available, weren’t on the market long, either. The average number of days on the market in the first quarter of 2020 was 40, representing an improvement of 15 days from one year ago.

Huntsville Real Estate Market Ends 2019 on High Note

The Huntsville Real Estate Market set a record pace throughout 2019, ending the year on a high note, according to a report released today.

The Huntsville Area Association of Realtors’ Fourth Quarter Real Estate Economic Report, conducted by the University of Alabama in Huntsville, found sales grew by more than 15 percent compared to the same quarter in 2018, with 1,995 homes sold in the quarter.

“We witnessed major growth in our industry last year, as more choose to make Madison County their home,” said HAAR President Sha Jarboe. “While this is great news for our city and industry, it also presents challenges as inventory reached historic lows in December with less than 1,000 available homes for sale.

“This report reinforces the need for attainable housing in our area and, as community advocates, Realtors stand ready to work with our local builders to make sure they have the skilled labor they need to meet our area’s construction needs. We also look forward to our continued collaboration with local leaders to support sensible laws that support the American dream of homeownership.”

Here are some key takeaways from the report:

  • Prices of homes sold continued to rise significantly from 2018. Median sales price rose 11 percent to $239,643 and average sales price increased 7 percent to $258,014. The price escalation can be seen in the decline in the number of homes sold in the less-than $150,000 homes and significant increases in the $200,000-$250,000 (20.5 percent) and the greater-than-$350,000 range (18.5 percent).
  • Average monthly pending sales rose to 456, up 16.6 percent from the 2018 fourth-quarter level.
  • Inventory of homes available for sale fell to the lowest level since 2001 with only 993 homes listed at year’s end.
  • The average days on market for the quarter was 35 days, down from 38 in the third quarter and from 48 in the fourth quarter 2018. At this level of sales, there was an average of only 1.3 months of supply during the quarter.

For information and to see the full report and other reports, visit haar.realtor.

Report: Madison County Housing Inventory is Lowest in 22 Years

ValleyMLS.com and the Huntsville Area Association of Realtors reported today that the number of active available listings of homes for sale in Madison County is 988, a figure lower than the Multiple Listing Service (MLS) has seen since 1998, when inventory data was first recorded.

The area’s recent success in job and population growth has led to low housing inventory numbers, while new construction and skilled labor to build new houses have battled to keep up with the trend.

“Today’s inventory milestone tells us that, whether you’re expanding or downsizing, there has never been a better time to sell a home,” said Cindi Peters-Tanner, 2020 ValleyMLS.com chair. ”If you were on the fence, these numbers should tell you that now is the time to find a Realtor and list your property.”

HAAR President Sha Jarboe said civic and business leaders should work together to respond to the low inventory numbers.

“We must all re-double our efforts across all organizations and levels of government to ensure we have the housing available for the thousands of new residents expected over the next five years,” Jarboe said. “Foremost, that requires attracting the skilled workers necessary for our local construction companies to keep up with demand.”

Founded in 1948, the Huntsville Area Association of Realtors is engaged in every aspect of the industry, including residential/commercial sales and leasing and appraisal. HAAR also maintains ValleyMLS.com, the leading real estate source in North Alabama.

Visit HAAR.Realtor

 

Study: Local Housing Market Stronger than National Trends; Low Inventory a Concern

While Madison County continues to outpace the national residential real estate market, the inventory of available houses remains a concern, according to a recently released study.

The Huntsville Area Association of Realtors, in partnership with the University of Alabama-Huntsville College of Business,  released its real estate economics report, which compares the local housing market in Madison County to its national counterpart.

 “Huntsville and Madison County appear on so many Top 10 lists for several good reasons: great job opportunities, low cost of living, a diverse economy and entertainment culture, and responsible management by our elected officials,” said HAAR President Cindi Peters-Tanner. “As a result, our real estate market has out-performed national trends and it continues to be the best place in the nation to buy or sell a home.”

As a result of the local market’s success, inventory remains a concern.

According to the reports, Madison County held 6.4 months of housing supply at the end of 2015. Since then, that number has dropped to 1.8 months while, nationally, inventory has risen from 5.1 months to 5.9 months.

The report said local new construction will need to grow considerably to meet future demand.

Additional findings of the HAAR / UAH report include:

  • Home prices are rising locally and national at the same rate of 4.5 percent.
  • Heightened labor force participation and median household income have increased the number of local residents with the ability to afford a house.
  • Local population growth continues to outpace national growth.
  • New construction accounts for roughly one-quarter (26 percent) of all home sales, beating the national average of 21 percent.
  • Since 2015, the Madison County residential real estate market has led the national average in new home sales percentage and population growth rate. 

HAAR has partnered with the UAH College of Business to produce quarterly real estate economic reports to provide Realtors, their clients, public officials, community stakeholders, and the general public an up-to-date snapshot on the local housing market. This information helps our community anticipate positive or negative changes as we look ahead to new growth and the challenges it brings. 

For information, visit HAAR.realtor/real-estate-economics-reports