According to the Alabama Economic and Real Estate Report released Thursday by the Alabama Association of Realtors, home sales increased for the sixth consecutive month in July, reaching their highest level in nearly four years as the summer buying season continued across the state.
“Mortgage rates climbed through July, yet home sales in Alabama continued to rise for the sixth consecutive month as well as year-over-year,” Alabama Realtors economist David Hughes said. “While there are signs of pessimism nationally, there may be rate relief in the near future, and there are indicators that the state’s housing market will be more active than this time last year to end the summer.”
Alabama recorded 7,361 home sales in July, a 19.8 percent increase from the same month in 2025 and a 3.1 percent increase from June.
The median home price also continued to rise. July’s median price of $287,750 was $47,166, or 19.6 percent, higher than a year earlier and 2 percent higher than in June. Hughes predicted prices will continue to increase slightly month to month as seasonal demand persists.
The total dollar volume of homes sold in July reached $2.44 billion, a 39.4 percent increase from the same month last year and 4.7 percent higher than in June.
Alabama had 22,006 active listings in July, a new post-pandemic high and a 6.3 percent increase from 20,698 listings a year earlier. Active listings also increased 1.5 percent from June. Homes remained on the market two days longer than in June and one day longer than in July 2025.
Despite the increase in active listings, the state had 4.1 months of housing supply in July, down slightly from 4.3 months in June. The decline reflected continued increases in home sales and buying activity. Housing supply, which estimates how long it would take to sell all homes currently on the market, was also below the 4.7 months recorded in July 2025.
The average 30-year mortgage rate was 6.54 percent in July, 18 basis points below the 6.72 percent rate recorded a year earlier. The rate was slightly above the 40-year average but remained below the 50-year average of 7.67 percent.
New home building permits totaled 1,586 in June, the latest month for which figures were available. That represented a 19 percent increase from June 2025 but a slight decline from the 1,644 permits recorded in May, ending a four-month upward trend.
Alabama’s unemployment rate was 3.2 percent in June, marking the third consecutive monthly increase and the highest rate in five years. The rate remained a full percentage point below the national unemployment rate of 4.2 percent.
The state’s labor force participation rate fell slightly to 57.1 percent in June, its lowest level since Alabama recorded the same rate in June 2023. The national labor force participation rate was 61.5 percent.
Hughes said the overall economic and real estate figures show advantages for both buyers and sellers and predicted the state’s housing market will remain healthy through the summer.
“Sellers continue to gain from strong equity growth, while buyers benefit from a healthier pool of active listings compared to previous years. Additionally, with the ongoing strength in new home building permits, which rose 19.0 percent year-over-year in June, the market continues to see fresh inventory enter the pipeline,” Hughes said. “Looking ahead to August, home sales are forecasted to rise year-over-year, signaling that robust homebuyer sentiment will continue to support the market through the close of the summer season.”
