Huntsville, AL Housing Market Report | September 2024

The housing market in North Alabama is showing signs of returning to pre-pandemic conditions, with inventory levels rising and home prices adjusting from summer highs. While on paper the numbers suggest a balanced or slight seller’s market, the reality for many sellers and buyers feels different due to the influence of buyer incentives and builder concessions. As inventory grows and homes stay on the market longer, sellers may need to adapt their strategies to meet shifting buyer demands. Key stats from Huntsville, Athens, and Morgan County provide insight into how these changes are shaping the market for both buyers and sellers.

Huntsville, AL September 2024 Housing Stats

The average sales price has increased by $9,000 year-over-year, from $370,000 to $379,000. This is down from the summer peak of $390,000, the $11,000 drop is certainly helping with affordability. The number of homes sold remains nearly the same, with 623 homes sold compared to 622 last year.

There has been a significant rise in the number of homes on the market, with a 45.7% increase in the Huntsville area—2,633 homes were listed at the end of September, compared to only 1,807 in 2023. This brings us back to 2018 and 2019 levels, reflecting a pre-pandemic housing market where conditions were more balanced, and that's where we seem to be heading now.

Athens, AL September 2024 Housing Stats

The average sales price jumped $28,000 year-over-year, from $328,000 to $366,000. Athens has really been leading the market, reaching prices comparable to Huntsville. They hit a high of $393,000 during the summer, just above Huntsville's $390,000. Athens is now down significantly, dropping from $393,000 to $366,000.

Fewer homes are sold in Athens, making the market more sensitive to price swings based on what actually sells. The number of homes sold is relatively flat year-over-year, with 190 homes sold compared to 180 last year. Like Huntsville, there has been a big increase in the number of homes on the market, with a 64% jump—971 homes listed compared to 592 last year.

Morgan County September 2024 Housing Stats

In one of the more affordable markets, Morgan County, the average sales price increased by $27,000, from $257,000 last year to $284,000. Prices have slightly decreased from the summer high of $297,000, but the county remains a popular choice for buyers looking for affordability.

The market is relatively stable, with 119 homes sold compared to 102 last year. Just like in Athens and Huntsville, there's been a significant increase in homes on the market—a 49.5% jump, with 486 homes listed compared to 341 last year.

New Listings, Pending Sales, & Closed Sales

The overall theme is flat, except for the increase in homes staying on the market longer. New listings remain relatively unchanged, with 1,341 compared to 1,325 last year, a 1.2% difference. The rise in inventory isn’t due to more homes being listed but rather because they are taking longer to sell.

Pending sales are up year-over-year, with 984 compared to 865, but this is just a one-month snapshot. Pending sales aren’t up 13.8% for the year since closed sales are nearly identical to last year’s numbers—1,046 versus 1,042 for September. We're already seeing a slowdown as we approach the election, and I expect the total number of closed sales for 2024 to be slightly lower than in 2023.

Days on Market & Average Sales Price

With homes taking longer to sell, the days on market have increased significantly, from 30 days this time last year to 43 days. This is also up from last month, which was 40 days. I expect this trend to continue through the winter months, as we typically see an increase in both days on market and inventory during this time. This pattern is likely to persist through November, December, January, and February.

The average sales price is also relatively stable, with only a 2% increase—from $348,017 last year to $352,708 in September. We are down significantly from the summer high of $371,865, a drop of over $19,000, which is helping with affordability.

Percent of List Price Received & Housing Affordability

One of the more confusing stats out there is the percentage of the list price received. Normally, you'd want to see that number around 97% for a balanced market, with about a 3% negotiation range to cover things like buyer closing costs or small discounts. Last year, the figure was 98.6%, and this September, it’s at 98.3%, slightly below last year. But this stat doesn’t account for builder concessions, which aren’t reflected in the MLS. If you factor in those concessions, the true number would be much lower than 98.3%, as builders are offering significant incentives right now, like interest rate reductions and decorating credits. While 98.3% might suggest a seller's market, it actually feels more like a buyer's market because of all the concessions being made.

Housing affordability has improved as prices have come down from the summer peak, and interest rates have dropped as well. We're approaching an affordability index of 100, which means the median household income can afford a median-priced home. Last year, we were at 91, but now we're at 98, which is great for our area, especially compared to other markets across the U.S. Builders are also focusing more on affordable housing, and if you factor in some of the rate buy-downs from builders, we’re likely even above that 98 figure.

Months Supply of Inventory & Housing Inventory

The supply of homes in Huntsville, Athens, and Morgan County has significantly increased. Last year, the supply was at 3.2 months, and now it’s up to 4.2 months, which is considered a balanced market. A balanced market is typically defined as 4 to 6 months of inventory. Since last year was 3.2 months, that was technically a seller’s market. Overall, inventory across North Alabama is up by 31.6%. There were 3,193 homes for sale this time last year, and now we're at 4,203. We're seeing inventory levels that resemble 2018 or 2019, which were pre-pandemic numbers. This is great news for homebuyers, as they now have more options to choose from.

Housing Deals in North Alabama

Housing affordability has improved, with the index at 98, thanks to home prices coming down from summer highs and interest rates starting to drop. This makes homes more affordable in the area. For new construction, many builders are offering interest rate incentives. If you're looking for which builders have the best deals, contact Matt Curtis Real Estate, and one of our agents can connect you with the right builders to help you take full advantage of these incentives, potentially pushing your affordability even higher than 100 on the index. Interest rates play a huge role in housing affordability.

Another trend we're seeing is a large increase in townhome supply, which is currently at a 7-month supply—a clear buyer's market. This represents a 179.4% increase in the supply of townhomes. If you're in the market for townhomes, they tend to be more affordable and rate higher on the housing affordability index. Many builders are very negotiable on townhomes right now. We can guide you to where the best deals for townhomes are in the market today.

Is It Really a Balanced Market?

So overall, we're in a strange market. On paper, the average sales price is up year over year, and the list-to-sales ratio is 98.3%. For a typical market, you'd want to see around 97% or more, which points to a seller's market. Additionally, the current supply of 4.2 months indicates a balanced market.

While all of this suggests a balanced, maybe slightly seller-leaning market, the data is skewed by buyer incentives. These incentives make the numbers look average, but in reality, it feels more like a buyer’s market—especially with builders offering deals and sellers having to price more competitively to keep up.

So, while on paper it may look like a balanced or even a slight seller’s market, sellers are experiencing conditions that feel more like a buyer’s market. Buyers have a bit more leverage right now, and we’re seeing an increase in withdrawn and expired listings.

If a seller doesn’t have a unique property or isn't aggressive with pricing, or if they received poor pricing advice from their agent, their home may sit on the market longer. This highlights the importance of choosing the right agent. Who you hire matters. If they don’t have the right marketing, pricing, and support strategies in place, it could mean trouble.

We’re seeing many homes withdraw or expire from the market, but if that’s you, we’d love to be your second choice. We specialize in helping sellers who didn’t succeed the first time. We offer a fresh strategy to get your home sold and help you move on—whether you're relocating across town or across the country. Call us at 256-333-MOVE, and we’d be happy to assist you.

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