Huntsville, Alabama Housing Market Report June 2024

In the June 2024 North Alabama Real Estate Market Report, key trends in Huntsville, Athens, and Morgan County are highlighted. Important metrics such as average sales price, inventory levels, and days on market are discussed. The report also covers changes in new listings, pending sales, and closed sales across the region. With rising prices, fluctuating affordability, and shifts in market dynamics, the insights provided are valuable for anyone interested in the real estate landscape of North Alabama.

Huntsville, Alabama Housing Market Report | June 2024 

The Huntsville area has remained relatively flat over the past year. The average sales price increased by $3,000, reaching $390,000 compared to $387,000 at this time last year, reflecting a 1% rise. The number of homes sold also saw a slight increase of 5.2%, with 685 homes sold this year compared to 651 homes last year.

There has been a significant increase in the number of homes on the market not only in Huntsville but across north Alabama as well, with a 42.9% rise. The current inventory stands at 2,237 homes, compared to 1,565 at this time last year.

Athens, Alabama Housing Market Report | June 2024

In the Athens area, the average sales price continues to rise, with a substantial $20,000 increase year over year. The average sales price is now $393,000 compared to $373,000 at this time last year. Athens has been neck and neck with Huntsville over the past several months and has now surpassed Huntsville in terms of average sales price, marking a first for Athens.

I expect this trend to continue, as Athens is a growing suburb with highly desirable school districts and plenty of attractions, including the new Buc-ee’s. Athens is definitely an area on the rise, so keep an eye on this trend.

The number of homes sold did see a decrease, with an 11.6% drop year over year to 167 homes sold this year compared to 189 last year. Similar to other areas, there was a significant increase in the number of homes on the market, with a 59% rise. The current inventory is 819 homes, compared to 515 at this time last year.

Morgan County, Alabama Housing Market Report | June 2024

Morgan County continues to rise as one of the more affordable housing areas in our market. Average sales price is up $6,000 now we're up to $297,000 versus $291,000 this time last year. there was a pretty significant decrease in terms of percentage, in terms of the number of homes sold. In reality, that was only a 20 home sold difference, but a 17.3% decrease. 135 last year versus 115. like all the other areas as well, a big increase in terms of the number of homes on the market, a 72.3% increase, 386 versus 224.

New Listings, Pending Sales, & Closed Sales

For the overall North Alabama market, new listings are relatively flat year over year, down only 0.5%, with 1,495 new listings compared to 1,502. This is notable because new listings had been increasing significantly in the first five months of the year but started to level off in June.

Pending sales are down slightly by 3.2%, with 1,101 pending sales this year compared to 1,137 at this time last year. For context, nationally, around 6 million homes were sold during the pandemic era. Last year, 5 million homes were sold, and we expected a similar number this year. We're currently on pace for about 4 million homes sold, reflecting a significant drop due to rising interest rates and affordability issues, impacting not just Huntsville but the entire US.

Closed sales are also down year over year, decreasing by 9.8% from last June to this June, with 1,074 closed sales compared to 1,191.

Days on Market, Average Sales Price, & Percent of List Price Received

Days on market continue to increase, which is a positive development for buyers and the overall health of the market. It seemed like homes were selling in no time or within a week during the pandemic, but the average days on market has risen from 33 to 39 days in the North Alabama area.

Despite the challenges of affordability and higher interest rates, the average sales price across North Alabama continues to rise, up by 6.2%. This increase is outpacing inflation. Last year, the average sales price was $350,261, and it has now risen by about $20,000 to $371,065.

The percent of list price is nearly unchanged, decreasing slightly from 98.8% to 98.6%. Ideally, we would like to see this closer to 97% for a balanced market. The actual situation might be closer to 97% because some builders are adjusting this figure with concessions in other areas, so the effective percentage may be around the 97% mark overall for the market.

Housing Affordability, Months Supply of Inventory, Homes For Sale Inventory

Housing affordability is still down. Last year, the affordability score was 93; now it is 89. The increase in prices and interest rates, which are currently around 7%, has impacted overall affordability. The good news is that the affordability number has been relatively stable in the high 80s over the last few months, so we might see a slight improvement if interest rates begin to decrease.

One significant change is the increase in supply. Last year, we had 2.8 months of supply, and now we are at 3.7 months. This suggests a balanced market, which has been the case for over six months. We are just below the typical four to six months range that indicates a normal market, neither a buyer's nor a seller's market.

As noted in the Huntsville, Athens, and Morgan County markets, inventory is up. Overall inventory has increased by 32.1%, with more homes available—over 800 additional homes. We had 2,804 homes available this time last year, and now there are 3,627. Although this represents a significant increase, it is closer to the pre-pandemic inventory levels of 2019, which were lower than historical averages. While this is an improvement, we are still not quite where we need to be for Huntsville or the overall US market.

Major Takeaways from June 2024 Housing Market Report

Overall, prices are up across the Tennessee Valley. Huntsville’s average price increased by $3,000, Morgan County’s by $6,000, and Athens saw a notable jump of $20,000. Athens has now surpassed Huntsville for the first time in average sales price, with Athens at $393,000 compared to Huntsville’s $394,000. I expect Athens to continue to outpace Huntsville as a desirable suburb and a convenient option for commuting to Huntsville jobs.

New listings have leveled off for the first time this year after a significant surge in the first five months. We’ll need to monitor if this trend continues over the next few weeks. There has been a slight increase in listings signed recently, which may be a short-term pause, but we will need to see how the July and August numbers develop to determine if this is a trend.

Inventory and supply are both up 30% year over year, returning to pre-pandemic levels from 2019. We are also nearing a balanced market with 3.7 months of supply, which is close to the six-month balance typically seen. The market may feel like a buyer’s market due to the extreme seller’s market experienced during the pandemic. In reality, the market is normalizing in terms of appreciation rates and supply. The number of homes sold is relatively flat, down 0.6% year over year and 22% from 2022.

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