Tag Archives: Birmingham Area

Birmingham May Real Estate Sales Resume Upswing

Birmingham Area MLS* Monthly Observations for May 2017

May saw a substantial increase (23%) in dollar sales from April. Sales were slightly lower in units and slightly higher in dollars than last year, which was very robust. The next few months should show us a more consistent pattern.  Prices are modestly increasing. Total dollar sales for May were $421,269,944 up 3% from $409,254,772 last year, and up 23% from last month at $342,710,819.

Total Unit sales were down 4% at 1,857 in May from 1,943 last year and off by 17% compared with 1,585 in April. New sales were down 17 at 163 homes this month, vs. 180 in April, and off by 13 from 176  last year. The low inventory level of new homes suggests a good environment for builders. Used sales were 1,694 homes in May, up 21% from 1,404 last month, and off by 4% from 1,767 last year (Sect E p.3).

ACRE numbers are slightly different from those we report. For ACRE, our month by month 2017 forecast can be seen here: ACRE. For Birmingham, the full year projection for 2017 = 15,238, a 3.6% difference from 2016 actual of 14,705. The cumulative error is minus 2% for the year; that is actuals are behind projections of 4,451 through April, at 4,440 actual thru April. Check the link to see when the May numbers are posted.

Total inventory is slightly higher this month at 8,635 vs. last month at 8,126 and less than 9,407 last year. (Sect C p.1). Active New listings decreased to 999 in May from 1,033 in April (Sect E p.3). Absorption rate for New homes is at 6 months supply this month, which is less than 7 months last year. (Sect E p.3). The New homes have normal inventory levels in the 4-8 month range depending on area and price range. (Sect C p.1).

Absorption for Used homes in May shows 5 months, which is less than the 6 last year. Used Active listings at 7,636 are up from last month of 7,093, and less than 8,252 last year (Sect E p.3). Inventory levels have continued to trend down from prior years. Market performance is highly area specific, so check the individual area charts. For instance, Mountain Brook has between 1 and 6 months of inventory, 4 months overall. There are a number of MLS areas, particularly those known as the “over the mountain” communities, showing similarly low levels, including Homewood, which has 3 months of inventory.

Birmingham area Average Days on Market for New houses is 205 compared with last month at 198. The Used homes DOM was 107 in May vs 104 last month, (Sect A p.18). Average sales price for Sold New homes increased to $305,046 from $285,446 last month (Sect A p2). Over a several month period prices seem to be quite unchanged. Average sales price for Sold Used was $219,331 this month compared to $207,297 last month. (Sect A p2). Given the general robustness of sales prices on average seem quite stable, not yet increasing by much.

After a brief pause last month sales seem to be back on the upswing, It will be interesting to see how sales unfold over the next few months..

TWB 6/11/2017  

Birmingham Area Sales In January Up 12% From Last Year

Birmingham Area MLS* Monthly Observations for January 2015

Dollar sales in January experienced an expected seasonal decline of 35% to $154,737,263 from December’s $236,286,564, up by 12% over last January’s $138,585,163. The 12 month moving average line for total dollar sales is continuing to show a very steady upward trend indicating modest and consistent growth.

January Sales

January Sales

Total Unit sales were down 25% to 873 in January from 1,157 in December, a decrease of 284. This is up 4% from last January at 840. New sales decreased by 86 units to 89 homes this month from 175 in December and off from 91 last year. Used sales were 784 homes in January, off 20% from 982 last month, a decrease of 198, and up by 5% or 35 units from 749 last year(Sect E p.3).

Keep in mind the ACRE numbers are slightly different from those we report. With Acre, we released our 2015 forecast which can be seen here. We expect the Birmingham area to be 6% above 2014 levels. So this month’s unit increase of 4% is slightly worse than the projection.  Based on what I see I expect pretty healthy market gains. I also expect to see a healthy increase in new construction, the beginnings of which we can see from the year over year gains in permits, below.

This month total inventory is 1% lower at 9,101 vs. last month at 9,195 and 9,347 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 912 in January from 1,058 in December, a decline of 146 units (Sect E p.3).  

Housing permits were up in Jefferson County to 93 in December from 72 in November. Shelby County went from 10 to 41 in December. It seems that builders are anticipating a strong spring market. I think they are right. In addition, we are seeing a more significant number of Multi-family construction units (which we do not formally track or report) in most markets.

Absorption rate for New homes is at 6.5 months supply this month which is even with 6.4 months last year at this time. Last month though, shows 8 months of supply (Sect E p.3). The New homes for the most part have normal inventory levels in the 1-7 month range depending on area and price range. (Sect C p.1 and Sect E p.3.)

Absorption for Used homes in January shows 7 months, one month better than 8 months last year. Used Active listings at 8,189 are lower than the 8,495 last year (Sect E p.3). Market performance is highly area specific, so check the individual area charts. For instance, Mountain Brook has about three months of inventory except in the over $900,000 category, which has 6 months of inventory (31 homes) with three sold in that price range last month . The average days on market for that category is 84. There are a number of MLS areas showing similarly low levels of inventory, including Homewood and Centerpoint.

Birmingham area Average Days on Market for New houses is 212 compared with last month at 189. The Used homes DOM was 130 in January vs 134 last month, (Sect A p.18). Average sales price for Sold New homes decreased to $295,257 from $310,600 last month (Sect A p2). Average sales price for Sold Used homes decreased to $163,851 from $185,266 last month (Sect A p2). The moving average price for all homes has been up steadily for the past year. (Sect A p2).


TWB 2/7/2015

Birmingham Area March Real Estate Sales Weak

Birmingham Area MLS* Monthly Observations for March 2009

March turned into a bust for the residential real estate market. While sales increased slightly from February, total dollar sales were still lower than any March on record since 1999. Dollar sales were up 4.8% to $153,515,619 in March vs. $146,453,884 in February. In March 1999, sales were $159,868,748. I have been reporting some pretty awful numbers lately and these are bad.  I’m feeling foolish for pointing to signs of a bottoming process. But still there are some faint flickers of good news which I’ll highlight below.

March 2009 Birmingham Area Total Dollar Sales

March 2009 Birmingham Area Total Dollar Sales

Total unit sales improved by 8.7% to 995 in March from 915 in February, an increase of 80. This is a 29% decline from March 2008 (1,405). New sales improved 13% to 180 homes this month from 159 in February; an improvement of 21 units. Used sales improved 7.8% to 815 homes in March from 756 last month, an increase of 59 (sect E page 3).

A bit of good news: total inventory is down 16% from last year at this time at 12,571 vs. 14,982. Contrast this 16% reduction in inventory with the 29% reduction in sales on a comparable month basis.  Active New listings decreased to 2,020 in March from 2,387 in February, a decline of 367 units (E-3). This is down 47% from a peak of 3,819 in September 2007*. While it seems that there are a low number of housing permits in the area (61 in February vs. 36 in the prior month for Jefferson County) the increase is worrisome.  New inventory still has to contract to 1,800 or to reach more normal pre-2004 levels, and in light of the heavy used inventory, and low sales levels even that would be high (See the chart on page C.1, and table on page E-3).

Absorption rates for New homes improved to 8 months from 9 months of inventory last month, about even with 8 months last year at this time (Section E page 3). New house inventories in the higher price ranges (above $500,000) remain excessive at over a year, and are continuing to see poor sales.

June 2008 set a record of 12,542 Used homes for sale. March 2009 shows 10,551 Used active listings (page E-3). Absorption for Used homes had been holding steady at 12 months of supply, level from June to August of 2008 and had been showing modest improvement which has now reversed, and sits at 11 months of inventory. This is a 1 month increase from last year’s level at this time (See section E page 3).

Again this month I looked at a number of the areas and was struck that the primary reduction in used homes for sale has occurred in the areas such as 170 North Birmingham/Norwood, 160 Eastlake, 130 Centerpoint (which alone dropped almost 100 active listings of which 76 were sales and 99 “fails”), while 140 Trussville, and 200 Mountain Brook, 230 Homewood were all up.  I suspect some sellers in the lower price ranges may simply giving up trying to sell? The market for houses requiring “Jumbo” loans remains challenged. While foreclosures have impacted average prices, a bigger factor is the dramatic reduction in the number of higher priced homes sold.

Birmingham area Average Days on Market for New houses 179 days as compared to 178 days last month. Used houses decreased to 117 from 119 in February (sec A page 18).

Average sales price for Sold New homes decreased to $211,410 from $227,119 last month (Chart sect A p2). Average sales prices for Sold Used homes decreased to $141,676 from $145,955 last month (Chart sect A p2). Note that the twelve month moving average line on all categories of houses, New, Used, and total is now showing a very substantial downward slope (chart section a-2) indicating that sellers are at last showing flexibility on pricing. It’s hard to read too much into average prices with the absence of higher end sales.

TWB 4/11/09

*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. Note that our totals are higher than what the MLS board reports because they apparently omit some areas which are in the MLS system but not in the immediate Birmingham area. We report everything in the system. Since both use consistent methods the % change or reported trend is almost always within a % or 2.

Sales Spring Ahead in Birmingham Real Estate in February

Birmingham Area MLS* Monthly Observations for February 2009

February is normally the beginning of a sustained seasonal increase in sales. It certainly got off to a reasonable start once again this year. We saw a real pick up in February. Dollar sales were up 36% to $141,945,250 in February vs. $104,321,607 in January. While this is a 30% decrease from February last year, it contrasts very favorably with 47% decline year to year reported for January last month. Those who have been reading this report for a while know that I have been reporting some pretty awful numbers. While I would not herald this month as the bottom there are some hopeful signs. I hope I’m not going to look foolish!

Total unit sales improved 22% to 890 in February from 729 in January, an increase of 161, this is a 26% decline from February 2008 (1,203). New sales jumped 26% to 152 homes this month from 121 in January; an improvement of 31 units. Used sales jumped 21% to 587 homes in February from 766 last month, an increase of 130 (sect E page 3).

Continuing on the good news theme is that total inventory is down 16% from last year at this time at 12,297 vs. 14,616. Active New listings decreased to 2,119 in February from 2,476 in January, a decline of 357 units (E-3). This is down 44% from a peak of 3,819 in September 2007*. In addition, the low number of housing permits in the area (38 in January for Jefferson County) is also a very positive sign.  Inventory still has to contract to 1,800 or to reach more normal pre 2004 levels (See the chart on page C.1, and table on page E-3).

Absorption rates for New homes improved to 8.1 months from 9 months of inventory last month, about even with 7.8 months last year at this time (Section E page 3). This number is heavily weighted by the 870 new homes in the $100,000-$200,000 price range representing 41% of all new homes for sale and having only 6.7 months of inventory. New house inventories in the higher price ranges (above $600,000) remain excessive, at over a year.

June 2008 set a record of 12,538 Used homes for sale. February 2009 shows 10,178 Used active listings (page E-3). Absorption for Used homes had been holding steady at 11.8 months of supply, level from June to August of 2008 but has begun to show a modest but fairly consistent reduction to 10.6 months of inventory in February. This is a .9 month increase from last year’s level at this time (See section E page 3).

This month I looked at number of the areas and was struck that the primary reduction in used homes for sale has occurred in the areas such as 170 North Birmingham/Norwood, 160 Eastlake, 130 Centerpoint, while 140 Trussville, and 200 Mountain Brook, 230 Homewood were all up.  Don’t know why, except that lower priced homes are selling better than higher. The market for houses requiring “Jumbo” loans remains challenged. While foreclosures have impacted average prices, a bigger impact is the dramatic sales reduction in higher priced homes.

Birmingham area Average Days on Market for New houses increased to 178 days as compared to 147 days last month. Used houses increased to 119 from 104 in January (sec A page 18). This is good news as some of the longer Days On Market houses are selling which is bringing the average up.

Average sales price for Sold New homes was virtually unchanged at $225,427 from $225,463 last month (Chart sect A p2). Average sales prices for Sold Used homes increased to $145,908 from $126,711 last month (Chart sect A p2). Note that the twelve month moving average line on all categories of houses, New, Used, and total is now showing a very substantial downward slope (chart section a-2) indicating that sellers are at last showing flexibility on pricing. Used house average prices recovered this month, reflecting a more normal market.

TWB 3/14/09

*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. Note that our totals are higher than what the MLS board reports because they apparently omit some areas which are in the MLS system but not in the immediate Birmingham area. We report everything in the system. Since both use consistent methods the % change or reported trend is almost always within a % or 2.

Birmingham Real Estate Sales Down 23% From Weak Last Month, 50% From Last Year

Birmingham Area MLS* Monthly Observations for November 2008
The continuing poor performance of world markets continues to negatively impact the local Real Estate market and consumer confidence is at an all time low.

The good news is that the absolute inventory of houses available for sale has been trending down for several months, which may eventually bring demand into balance with supply. The new home inventory is approaching more normal historical levels now at 2,488 active, down 34% from a peak of 3,795 in November 2007 there is still some distance to go to the 1800 or so that we used to regard as normal before 2004 (See the chart on page C.1, and table on page E-3). Unfortunately, for used homes, the decline in inventory is not nearly as constructive, and is due as much to people withdrawing houses from the market (“failures”) as to sales. In spite of the decrease in the number of active houses, the 12 month absorption rate did not change materially for new or used homes.

This chart is dense but shows the relationship of total gross number of houses (left scale) for sale and the inventory absorption  rate in months of inventory (right scale).

November 2008 Birmingham Inventory

November 2008 Birmingham Inventory

Total dollar sales decreased 23% to $124,305,387 in November from the weak $161,575,128 in October*. That is 50% lower than November 2007, at $248,121,442. November is usually pretty even with October so the month was disappointing. (page A-4). The gross dollar sales were the lowest for November since 1999.

November 2008 Birmingham Total Sales

November 2008 Birmingham Total Sales

Unfortunately, we are looking at further deterioration just as the local real estate market was beginning to stabilize. On a trend line basis, this months sales went decisively below the 2002 levels to the 1999 level while we had previously been tracking the 2003 levels (See page A 4).

Sections C and D of the main report present active and absorption data historically by Price Range and by Area.  There is a large disparity in performance and trends in different Price Ranges and Areas. For instance used houses over $900,000 had 26 new listings against 4 sales (a worse ratio than last month).  Out of 673 active new and used houses over $600,000, only 18 sold. Please look at sections C and D.

Absorption rates for new homes improved to 8.3 months from 9.0 months of inventory last month, about the same as 8.1 last year at this time (Section E page 3). We continue to see large retroactive changes in available inventory. The “failure rate” (expired listings), has been higher, and sellers and agents have not been renewing expired listings promptly. For example, we reported 8.1 months of new house inventory for last month which has been adjusted to 9 this month due to these retroactive changes. Don’t read too much into lower inventory figures and lower absorption as the discouraged sellers do generally renew listings, (many retroactively) just not quickly. New house inventories are excessive at over a year concentrated in the higher price ranges (above $500,000). Bigger developers in lower price ranges are almost sold out (0 to 5 months of supply) with remaining inventory held in the smaller and higher priced developments. Builders have been steadily reducing inventory since November 2007, which was the peak.

Total unit sales deteriorated by 27% to 742 in November from 1,017 in October a decline of 275 units. This is a decline of 43% from November 2007 (1,305). (See my footnote as to why this differs from the figures published by the MLS board). New sales deteriorated to 149 homes this month from 168 in October, a decline of 19 units, this decline affected all price ranges. Used sales declined to 593 homes in November from 849 last month, a decline of 256 (sect E page 3).

The number of months of supply “absorption” for used homes has been generally increasing over the last 9 months with a slight drop in November to 11 months of inventory. This is a 1.6 month increase from last year’s level at this time (See section E page 3). With the retroactive changes referred to above, and rounding, it’s fair to say that we are now at a 12 month level of inventory for used houses. Overall, new listings for new houses were down, but the sales level dropped faster, (see the chart on section B page 1). Over $700,000 we now see inventory for used houses at over 2 years (approaching 3 years). Birmingham area builders are doing a better job of reacting to the market, and constraining new construction 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. The number of new homes for sale peaked at 3,834 in September of last year, and now sits at 2,488, having declined in each month since the peak. We believe that there is an increasing amount of “shadow inventory” in both the new and used market places i.e.; houses held off the market for various reasons, but that really are for sale. It seems to me that the For Sale by Owners (FSBO’s) are on the rise also, but that many will revert to realtor listings as they discover just how tough the market is.

Active New listings decreased to 2,488 in November from 2,861 in October, a decline of 373 units (E-3). There were 149 new houses sold in the month, so the rest of the reduction is partially due to the higher failure rate, (the number of houses whose listings have expired or cancelled without a sale), partially offset by a lower number of new listings. Active Used Listings June set  a record of 12,490 used homes were for sale, and November now shows as 10,898 but that will probably show as a larger number next month as explained above (page E-3). Total inventory is down 11% from last year at this time 13,386 vs.15,038 .

Birmingham area Average Days on Market for new houses deteriorated to 160 days as compared to 139 days last month. Used houses went down to 94 from 105 October (sec A page 18).  Birmingham area Average sales prices for sold new homes decreased to $219,455 from $243,243 (Chart sect A p2). Average sales prices for sold used homes increased to $153,188 from $141,017 (Chart sect A p2). Note that the twelve month moving average line on all categories of houses, new, used, and total are all now showing a very substantial downward slope indicating that sellers are at last showing flexibility on pricing. Used house average prices are now at early 2005 levels.

TWB 12/13/08
*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. This month we had an opportunity to review the MLS board published numbers, they came out a lot earlier than usual. I was able to determine that most, if not all the discrepancies between the two reports are due to the different time frames when the data is gathered, in this month my unit sales figures on a unit basis were 23% higher than theirs MLS reported 603 and we report 742, in checking the system we found that yet more sales (8) have now been recorded for the month of November than this report. That is why we restate the history every month.

Signs point to recovery in house market- Birmingham, Alabama

I think the headline oversells the progress I have reported For the Birmingham, Alabama real estate market. But as they say, any PR is good PR! My main contention is that we are now seeing the signs of a bottom, of course one hopes that that will be followed by a recovery, and I’m sure it will. But I think we have a ways to go, as much as a year or even two. I’m working on some articles to expand on this for our coverage areas. So stay tuned. in the meantime check out the most recent News article (and my quotes). I do wish they would include a link here as I do to them!

Sunday, May 04, 2008
In the Birmingham News, Jerry Underwood, Business editor says:

After a string of monthly sales declines, the Birmingham-area housing market has shown some strains.

New home sales, which have been especially hard hit, showed some vigor in the Birmingham area during March.

The Rudulph-Brander Real Estate Report shows that area new home sales rose in March compared to the previous month.

Plus, the average sales price for an area new home increased to $250,159 in March from $223,663 in February, the report shows.

Sale prices in the Birmingham area have held up well during the entire downturn.

Last June, about the time the slowdown began, the median sales price in the Birmingham area was $170,000. In March, the figure was nearly $160,000 – a drop of less than 6 percent.

These are some of the reasons that Tom Brander noted in his Rudulph-Brander report that signals point to a bottoming out in the market. He’s not predicting a quick turnaround and concedes there still are challenges for the market. But he thinks there’s not much more downside.

“By the way, a bottom does not mean that things are about to get better, just that they may not get a lot worse,” he writes. “Sellers will have to continue to adjust their expectations. There are buyers out there, but they can afford to be very choosy.”

That’s another sign of an improving market. Jerry Underwood is business editor of The News. His e-mail: junderwood@ bhamnews.com

Birmingham Area January 2008 Comments

Monthly Observations:

Total dollar sales declined 27% to $170,012,070 in January from $231,997,024 in December. Normally January is a down month, but this is one of the worst month to month declines we have seen. This is a 29%, deterioration from last January 2006 ($240,034,527), against 9% more active listings. (Chart section A page 4).  

Total unit sales deteriorated 23% to 911 in January from 1,189 in December a deterioration of 278 units. New sales declined to 219 homes this month from 411 in December, a deterioration of 178 units. Used sales decreased to 792 homes in January from 778 last month, a deterioration of 14 (sect E page 3).

Absorption rates for new homes improved slightly to 7.6 months from 8.3 of inventory last month. This is an increase of .7 months over last year at this time, (Section E page 3). Note that last months active count went up retroactively (since last months’ report), presumably as agents renewed listings that had lapsed at year end.

Absorption for used homes improved to 8.9 months of inventory in January from 9.0 in December. This is a 1.3 month increase from last year’s level at this time.  Against reduced sales, the reduction in month of inventory is due to reduced new listing activity, an important component to improving the oversupply situation, but keep in mind that reduced listing activity is normal at year-end, but keep an eye on the next few months.

There was a 4% decline in active listings from 13,375 active listings in December* down to 12,820 in January, a decrease of 555 units. There has now been five months of declining active listings (page E-3). There were 496 new house new listings (an increase from 337 last month). New houses new listings once again resumed the trend running well ahead of the rate of sales, unlike last month. (Section B page 1). Active New listings decreased to 3,250 in January from 3,626 in December, a decrease of 376 units (E-3). Active Used listings decreased to 9,570 this month from 9,749 last month, a decrease of 179 (page E-3).  

Average Days on Market for new houses improved to 121 days as compared to 127 days last month. Used houses deteriorated to 108 days compared to 70 days in December. (sec A page 18).  As many of you know we don’t place much credibility on Days On Market (DOM). We prefer absorption rates and months of inventory, call me for details if you need to.

Average sales prices for sold new homes increased to $260,580 from $251,434. (Chart sect A p2) Average sales prices for sold used homes decreased to $163,215 from $164,835. We are seeing an upward slope of the 12 month moving average prices for new, houses. The twelve month moving average slope of used house prices continues to slump. (Chart sect A p2)

 TWB 2/12/08

 *All references to last month (and earlier) numbers are revised, to pick up late entries (made after our prior publication date) to the MLS system.