Total dollar sales declined 4.6% to $245,316,323 in April from $257,252,568 in March*. (See chart at right, Click to enlarge), is a 27% reduction from 2007 ($337,555,572). Not to panic! About 50% of the times in last 9 years April sales in the Birmingham area were lower than March, as they were this year (page A-4).
I still believe, signs of a “bottom” are appearing. By the way, a bottom does not mean that things are about to get better, just that they may not get a lot worse. Sellers will have to continue to adjust their expectations. There are buyers out there but they can afford to be very choosy.
Absorption rates for new homes improved to 7.4 months from 8.3 of inventory last month. This is almost identical to last year at this time, (see chart to right click to enlarge). It is only in the higher price ranges above $500,000 that new house inventories are truly excessive at over a year. Under this price threshold the inventories are reasonable, in the 6 to 8 month range. The bigger developers in these price ranges are almost sold out (0 to 5 months of supply) , with the remaining inventory held mostly in the smaller developments.
Total unit sales declined 3%% to 1,329 in April from 1,374 in March a deterioration of 45 units. New sales declined to 303 homes this month from 338 in March, a deterioration of 35 units. Used sales declined to 1026 homes in April from 1036 last month, an deterioration of 10 (sect E page 3).
The number of months of supply (Absorption) for used homes has been increasing over the last 5 months to 10.4 months of inventory in April. This is a 1.6 month increase from last year’s level at this time. (See section E page 3)
Birmingham area new construction by builders is doing a fair job of reacting to the market and constraining supply, but consumers who are the sellers of existing houses are having a harder time as the supply of used homes for sale is climbing. The build up of existing housing supply will continue to impact the new housing market for a while.
Good news: There was a 3.9% decline in active listings from 15,140 active listings in March* down to 14,546 in April, a decrease of 594 units. Active New listings decreased to 2,941 in April from 3,429 in March, a decrease of 488 units (E-3). Active Used listings decreased to 11,605 this month from 11,711 last month, a decrease of 106 (page E-3). Over the last 6 months number of new house active listings has consistently declined as the used market listings have generally crept upward. (See the graph above)
Birmingham area Average Days on Market for new houses improved to 162 days as compared to 164 days last month. Used houses improved to 96 days compared to 106 days in March. (sec A page 18). As many of you know we don’t place much credibility in Days On Market (DOM), preferring absorption rates and months of inventory. Call me for details.
Birmingham area Average sales prices for sold new homes decreased to $233,268 from $249,920. (Chart sect A p2) Average sales prices for sold used homes increased to $170,045 from $166,615. (Chart sect A p2)
*Caution:! All references to last month (and earlier) numbers show revisions. Each month we pick up late entries (i.e. ones made after our prior publication date) to the MLS system. For some reason this month had a somewhat larger number of late entries than normal, which affects the number of active listings this is presumably due to listing expirations at month retroactively made active again. Trends are intact however. Tracking the numbers from historical reports is somewhat harder.
Important note: Three months ago Birmingham Area MLS merged the Calhoun County (Anniston area) MLS into its database; this report includes areas (152, 154, 156 and 158), and history going back to 2005. It has minimal effect on the data we are presenting.