Alabama Coastal Real Estate Continues Strong Recovery

Baldwin County & Alabama Coastal MLS*: Observations for the Month of September 2013

Sales dollars declined 17% in September to $101,878,090 from August’s $122,637,528. This is 26% above September last year at $80,536,696. (Sect A p.2). This is a strong showing for September, early in the slower fall season. The 12 month moving average line of sales has continued to point up steadily for three years now. Inventories are slowly trending down.

On a unit basis, sales of all houses were down 18% at 439 this month vs. last month at 536, which is up 22% from last year’s 359. In spite of the substantially improved sales climate, it is important to point out that the inventories of homes over $400,000 while improving from really bad levels, remain at over a 12 month supply.

Used Home sales declined 19% to 385 this month vs. 475 last month, which is up 21% from last year’s 318 (Sect A p.18). New Home sales were 54 this month vs 61 last month compared with 41 last year. Increasing year over year sales of New Homes is indicative of a recovering market.

New listings for New homes increased to 73 from 71 in August. Used homes New listings decreased to 600 from 631 in August with net inventory down.

The absolute number of Used Active homes on the market, which had a slight peak mid-summer of ‘09, has once again been improving. In September, there were 3,516 Active Used homes, a reduction from 3,945 in August. The New home market, which peaked in September 2006 at 2,144 Active, now sits at 383.

The Absorption rate for New homes was 9 months of inventory for September vs. 10 in August. The Absorption rate for Used homes was 9 months of inventory for September vs. 10 in August. Over the last four years the drop in months of inventory for Used homes has been steady and impressive from 25 months plus in September 2008 to 9 months this September. As I observe above though, the inventory of homes remains high.

Average sales price for all homes have been improving modestly for the past year. For New units, prices increased to $310,899 from $242,446 last month. (Sect A p.14). Average Used home prices decreased to $221,012 from $227,049 in August. The price trend is up for the year.

Average Days On Market for New Sold properties in September was 161 this month vs. 180 last month. Days On Market for Used was 165 this month vs. 150 last month.

We see improvement in the second home market, which is needed for the coastal area to gain strength. While there is still a lot of inventory particularly in the upper price ranges, sales are continuing to improve. The situation on the coast has turned quite positive.

TWB 10/13/2013


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