Is Huntsville a Top 10 Housing Market in 2023?

Is Huntsville, Alabama, a Top 10 real estate market to watch in 2023? The National Association of Realtors (NAR) seems to think so as they've ranked Huntsville number seven on their list of top cities in the US to watch in 2023.

Huntsville Housing Affordability

The study was based on several factors. One of those factors was the Housing Affordability Index. How affordable is the city? Huntsville has been above 100 for several years, anything above 100 is more affordable and anything below 100 is less affordable. A score of 100 means the average income can purchase the average home in that area.

NAR is actually behind on Huntsville's data and gave us a score of 120 when we're actually a score…

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Huntsville, AL Housing Market Update | November 2022

Home sales are down 27% year over year, yet prices are still up 8.7% year over year. Housing affordability and the mortgage rate lockdown effect are continuing to push the number of homes sold down, we’ll look at what effects these and other factors had on the Huntsville housing market in November. If you’re looking to buy or sell a home in Huntsville, AL, this information can help you make the best decision based on your situation.

New Listings, Pending Sales, & Days on Market

New listings are down 16% year over year, which is due to this mortgage rate locked down we’re experiencing. In fact, there are a lot of sellers that have rates starting in the 2’s or 3’s which are ultra-low interest…

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The Fed Strikes Back

Inflation is down, interest rates are down, the stock market's been going up, and enters the Fed; The Empire Strikes Back. The Fed's at it again, they've raised the overnight rates to a target range of between 4.25% to 4.5%, which is down from the previous increases. They've been raising them by .75% for the last four meetings, this is the seventh time the Fed has raised rates in 2022.

The Fed’s Goal

We are still in unprecedented times with the Fed's interest rate moves. On top of raising rates, the Fed also offered guidance that their new target rate is between the 5% to 5.25% rate, which is still another .75% from where we're at today. That's about half a point higher than the Fed had previously predicted and much…

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Real Estate Investor Slowdown

Real estate has been weird for the last couple of years, especially for real estate investors. We've had COVID, we've had this 5.5 million home deficit in the housing market, and then we've had this rise of institutional buyers in the marketplace. As a real estate investor, I've always been taught that you make a lot of your money at the purchase stage so you want to buy a home priced right.

All that's been thrown out the window over the last couple of years with this rise of institutional home buyers. They're buying homes at list price, often $20,000 to $30,000 above list price, and buying hundreds and even thousands of homes at a time. So why did they do this? It all came down to yield spreads and cap rates.

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Why Aren’t Housing Prices Dropping? | Buying a Home in Huntsville, AL

 

Mortgage rates are way up, and affordability is way down. You would expect prices to be coming down but they're not. So what is happening?

When it comes to housing prices not dropping, we've talked about a lot of the reasons like dollar devaluation and with a 5.5 million home deficit across this country there are also issues with of lack of supply. Another thing affecting housing prices is the mortgage rate lockdown effect.

Mortgage Rate Lockdown Effect

The mortgage rate lockdown effect is due to so many households having such low mortgage rates, that once rates rise, they have no interest in selling their home and getting locked into a much higher rate.

That's…

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Sneak Peek Listings for December 2nd

5298 Bay Shore Drive - $299,900

5298 Bay Shore Drive, Athens, Alabama 35611

3 Bed | 2 Bath | 1,678 sqft

Talk to an MC Agent today for more info or call 256-270-9393!

40 Buttercup Drive - $175,000

40 Buttercup Drive, Guntersville, Alabama 35976

2 Bed | 1 Bath | 925 sqft

Talk to an MC Agent today for more info or call 256-270-9393

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