According to the October 2023 Alabama Economic and Real Estate Report released by the Alabama Association of REALTORS® (AAR), the state’s housing market remains down, but declining interest rates and increases in two key areas – housing supply and average sales price – offer strong hope for a future rebound.
Alabama experienced 5,596 home sales in October, which represents a decline of 3,488 sales compared to one year ago. The median sales price decreased by $17,016 during the same period, a loss of roughly 7.6 percent.
Conversely, the average sales price rose in October, representing a 0.6 percent increase when compared to September 2023. October also saw 16.5 percent more active listings compared to one year ago, and 975 new listings have come onto the market since September.
“It is encouraging to see more homes on the market, which give potential buyers more opportunities for homeownership,” said Senia Johnson, President of Alabama REALTORS®.
In a positive development, the Federal Reserve voted at its November meeting to keep the fed funds rate target constant, increasing optimism that the Federal Reserve has reached the end of its rate hikes, and allowing rates to decline throughout early November. The average 30-year fixed rate mortgage has decreased to 7.44 percent as of November 16 from highs of approximately 8 percent in early October.
“Declining interest rates signal promise for Alabama’s real estate market,” said Jeremy Walker, CEO of Alabama REALTORS®. “The decrease in rates presents new avenues for growth and investments in our state. Alabama’s economy remains strong statewide, unemployment is down, labor participation is up, we have an increased number of residential listings, and falling mortgage rates. All of which may lead to increased sales activity despite seasonal trends in the winter months.”
The Alabama Economic and Real Estate Report is published monthly and annually by the Alabama Association of REALTORS®. Click here to view the full monthly and annual reports.