Posted by Matt Curtis on Friday, February 20th, 2026 11:27am.
If you’ve been waiting for a sign that the housing market is gaining traction again, January delivered it. Demand is moving, pending sales are strong, and affordability has improved, which is changing the feel of the market heading into 2026.
Let’s start with what actually happened in January (combined market)
Now let’s break down what matters most.
Pending sales are one of the best “right now” indicators we have. We had 1,704 pending sales this month, which tells us buyers are actively making decisions and getting under contract.
We are also seeing a big year over year demand jump in parts of our market. Sold homes are up as buyers respond to better payment conditions, and we are tracking about a 33% increase in sold homes year over year as rates ease and buying power improves.
The combined market median sale price is $300,000, up from $297,000 last year.
That is a stable pricing story. Sellers have not been giving away value, and buyers have still been willing to pay for the right home.
With rates trending down, I expect values to begin rising again in 2026 as demand strengthens.
Inventory is nearly flat year over year, with 4,932 homes on market compared to 4,999 last year. At the same time, days on market rose to 74, up from 65.
That means buyers have a little more time to decide, and sellers have to earn the sale with pricing, condition, and marketing.
Here’s the stat most people miss. Huntsville’s Housing Affordability Index is 105, and it was 100 just a few months ago. That means the median household income can afford more than the median priced home in our area, which is a major shift in buying power. Buyers are not just barely qualifying, they have a little breathing room again.
That matters for three reasons:
Markets with stronger affordability tend to hold up better because there is a deeper pool of qualified buyers. It makes Huntsville stand out nationally. Affordability plus job growth is exactly what keeps relocation demand flowing into North Alabama. This is one of the biggest reasons I believe 2026 can turn into an upward year for values if supply does not keep up.
The strongest new construction activity is in the $325,000 to $425,000 range, especially in:
That price band is where a lot of buyers are finding the best balance between payment, condition, and long term value.
According to the latest February 2026 MarketGraphics report, the Huntsville region currently has about 12,400 developed lots. Between now and 2031, we are projected to need nearly 36,000 lots. Madison County alone will need over 20,000. Limestone County will need over 9,000.
So what does that mean? If development does not accelerate, we are going to feel pressure. Pressure on pricing. Pressure on availability. Pressure on builders competing for land. This is not a crash story. This is a supply story. And supply stories create opportunity.
When rates drop, demand rebounds fast. That part is normal. The risk is demand improving faster than our lot pipeline can support. If affordability stays strong and buyers surge back in, the shortage shows up quickly. If you’re a buyer, builder, or investor, land pipeline is everything right now.
January shows a market that’s stable on price, steady on inventory, slower on pace, and improving on demand. The big question for the next few years is simple. Can supply keep up with growth? If you want help building a plan around your timeline, your price range, and the areas you are watching, schedule a buyer consultation or seller consultation with our team at Matt Curtis Real Estate. Who you hire MATTers.