1st Half Birmingham Real Estate Sales Up 6% From Last Year

Birmingham Area MLS* Monthly Observations for June 2014

As expected, June was stronger than May. Dollar sales in June improved by 9% to $313,709,561 from May’s $287,922,936, up by 5% from last June’s $297,471,361. The 12 month moving average line for total dollar sales has flattened indicating uncertain market conditions. For the 1st six months of 2014,  sales were up 6% to $1,397,869,781 compared to $1,314,060,637 for the same period last year.

Unit sales were up 2% to 1,517 in June from 1,482 in May, an increase of 35. This is up 19% from last June at 1,268. The greater percentage increase, month to month, in dollars rather than units, indicates an increase in average prices, while the greater percentage gain year to year indicates a reduction in average prices. For the 1st 6 months total unit sales were up by 2% to 7,503 compared with 7,358 last year.

Using the ACRE data and results for forecasting, which are derived in a slightly different method than this report, we forecasted a full year gain of 8% for the full year. As of June the cumulative increase in units is 4%. We determined that the Birmingham MLS is assigning some sales to the Talladega market which were previously reported as part of Birmingham, thus reducing the reported sales in Birmingham, so the forecast is probably a bit more accurate than it appears on a “comparable” basis.

New sales improved by 4 units to 138 homes this month from 134 in May and about even with 139 last year. Used sales were 1,379 homes in June up 2% from 1,348 last month, an increase of 31, and up by 111 units from 1,268 last year(Sect E p.3).

This month total inventory is 4% lower at 9,545 vs. last month at 9,908 and 10,619 last year. The drop in the current month is caused by month-end expirations which should come back on the market. Active New listings decreased to 699 in June from 1,012 in May (the highest level of new homes active since September 2011), a decline of 313 units (Sect E p.3).  Housing permits were down in Jefferson County to 105 in May from 119 in April. Shelby County went from 45 to 49 in May. It appears that builders are trimming their activity.

Absorption rate for New homes is at 5 months supply this month which is two months better than last year at this time. Last month though, shows 7 months of supply (Sect E p.3). The New homes for the most part have normal inventory levels in the 1-7 month range. (Sect C p.1 and Sect E p.3.)

Absorption for Used homes in June shows 8 months, one month better than 9 months last year. Used Active listings at 8,846 are lower than the 9,681 last year (Sect E p.3). The market performance is highly area specific, so check the individual area charts. For instance, Mountain Brook has about four months of inventory except in the over $900,000 category, which has 9 months of inventory (41 homes) with nine sold in that price range last month . The average days on market for that category is 166 indicating older inventory is moving.

Birmingham area Average Days on Market for New houses is 201, compared with 216 last month. The Used homes DOM was 131 in June, compared with 132 last month (Sect A p.18). Average sales price for Sold New homes increased to $302,064 from $292,819 last month (Sect A p2). Average sales price for Sold Used homes increased to $197,262 from $184,485 last month (Sect A p2). The moving average price for all homes has been up steadily for the last year. (Sect A p2).

Note the MLS has added 20 new areas #320-570, which seem to be placeholders for each county in the state. I have combined these into a single “other” area.

TWB 7/12/2014


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