With 2013 right around the corner, many housing industry experts have looked back over 2012, and for the most part have been encouraged by what they have seen. Although the housing market as a whole has not been completely free from challenges, the year of 2012 has presented industry professionals and new home buyers with some very positive numbers and a housing recovery that is actually underway.
Market conditions in 2012 became more favorable, builder confidence rose higher, and the demand for new homes for sale increased. With mortgage rates staying near record lows, homeownership became more affordable for a greater number of potential home buyers, who had been looking for new homes. Many buyers chose to take advantage of market conditions and purchase into new home communities that offered affordable new homes for sale. As home sales started to climb, so did the number of improving housing markets, which increased substantially across the country over the course of the year. Birmingham, Alabama is no exception.
According to a recent report by the Alabama Center for Real Estate (ACRE), November posted positive gains in the Birmingham housing market, as year-to-date home sales through November went up 10.7% from last year. ACRE also reported that Birmingham home sales showed a 6.5% increase from November 2011.
More good news involves the decreasing inventory levels in the Birmingham housing market, which have declined 41.4% from the month of November in 2007, when inventory levels last peaked. The Birmingham area housing inventory has decreased 9.8% from last November. The inventory-to-sales ratio in November 2012 showed a favorable 15.3% decline, standing at 9.3 months, which is an improvement from November of last year, when inventory levels stood at 11.0 months.
Home sale prices also increased in November of this year, as the Birmingham metro area median selling price rose 13.6% from November 2011. This also represents a 6.0% increase in home sale prices from October 2012.
As the housing market continues through year-end, it is clear that there are still some challenges that loom ahead in 2013. However, 2012 has served as a very encouraging and positive transitional year for many housing markets across the country, including Birmingham. Through the month of October, 19 of the 25 local housing markets, or 76%, have experienced year-to-date sales growth from 2011. This poses as very welcome news for the Alabama real estate community and home buyers looking for new homes for sale in Birmingham. Based off of the positive trends seen throughout the course of 2012, all indications point toward a housing market that will continue down the path of recovery and the real estate community can look toward 2013 with optimism.