Huntsville/North Alabama Area MLS Observations Huntsville, Alabama Residential Real Estate Market February 2010:
Total dollar sales dropped from January to February for the first time in ten years, a disappointing decrease of 1% in February ($71,633,245) vs. January ($72,174,910). This was 25% lower than last year ($95,599,846). The twelve month moving average line on the total dollar sales chart shows a highly unusual “squiggle”. What this portends is anyone’s guess. However for the last ten years March has always been better than February so it is likely that will hold true again this year.
Total unit sales increased from 459 in January to 495 in February, an increase of 36.
New sales increased from 82 homes last month to 108 this month, an increase of 26.
Used sales increased from 377 homes last month to 387 this month, an increase of 10 (Sect E p.3).
Used inventory levels remain high. Used homes are 12 months of inventory in all price ranges. The inventory situation remains even more challenged in the higher price ranges. Used homes over $200,000 are now at over 17 months of inventory, and in some price ranges as much as 9 years of inventory. Prices continue to be pressured.
New houses are at 10 months of inventory, and homes priced greater than $400,000 are over a year’s worth of inventory, and in some price ranges over 8 years of inventory. (E-1).
I have noted on the web site what seems to be a large number of housing permits issued, given the market conditions. There were 62 new single family housing permits issued (January), down from 77 in December in Huntsville City, according to the Census department. This permit level is above the sales level for the comparable area. I have received comments that this might be due to tract builders who do not list in MLS, and indeed that may be a factor, but MLS still accounts for the vast majority of New (and Used) homes sold. This month the Huntsville city areas showed 39 new sales, and 100 New listings for New homes…which lines up fairly well with the past permit data, and seems to line up fairly well with the absolute inventory levels in this report. The months of inventory calculation removes the issue of MLS vs. non MLS data since it is all based on MLS, and is a ratio of that data. Inventory remains high.
Total Active listings decreased by 2% this month at 8,267, compared to last month at 8,465 (Sect A p.4 and Sect E p.3). (I expect this will increase when reported next month.) New houses New listings ran 2.8 times the rate of sales (Sect B p.1). Active New listings decreased from 1,615 last month to 1,461 this month, down 154 (Sect E p.3). Active Used listings decreased from 6,850 last month to 6,806 this month, down 44 (Sect E p.3).
As this year begins, the inventory level is higher than last year and the sales lower and the BRAC realignment will not cure the market, particularly in light of other employment problems. What banks are funding construction?
Absorption for New homes was at 10 months of inventory in February. This is better than 11 months, last year at this time (Sect E p.8). Absorption for Used homes was 12 months of inventory in February which is even with last month. This is a deterioration of 2 months from last year’s level at this time (Sect E p.8).
Average Days on Market for Sold New houses was 171 days this month, with Used at 146. (Note the calculation for DOM was changed to fix an error so prior months reports are not comparable) (Sect A p.18).
Average sales price for Sold New homes was $207,124 vs. $223,536 last month. (Sect A p.2)
Average sales price for Sold Used homes was $127,297 vs. $142,825 last month. (Sect A p.2)
The twelve month moving average line of prices for New homes has a decidedly negative slope, indicating that prices are truly coming down. Used prices seem to have leveled off a bit, which is encouraging. The mix of higher and lower priced homes is jumping around quite a bit so it’s hard to read too much into average prices.