Matthew Whitaker - Saturday, May 31, 2014
The latest stats are in, and according to reports, home prices have risen yet again in Birmingham. According to the Alabama Center for Real Estate (ACRE), median home values rose in March by 8.89 percent from March 2013, from $149,000 a year ago to $162,250. Homes across the spectrum are worth more, since the average home price also rose by 7.61 percent. It now stands at $193,452. There were fewer homes listed in March than in March 2013, by five percent; that, coupled with the rising number of total sales, suggests that supply is continuing to become constrained in the area, which is providing upward pressure on home prices. We’re now at seven months of supply, just 1.5 months above equilibrium, which means we’re headed toward a sellers’ market before too long. Implications for the Rental Market As professional Alabama rental managers, we always like to translate movements and trends into implications for the area’s rental market. The trend of tighter supply and rising prices, coupled with increasing mortgage rates, means that the rental market will continue to stay strong. More people can buy homes today, but there simply aren’t enough homes in certain segments to go around. That, coupled with the fact that homes are becoming more expensive to purchase with each passing month, suggests that demand for rental homes will continue to remain at high levels throughout 2014. Rental property owners should work to tap into what should be more potential renters in the Birmingham area, and could consider expanding their holdings to take advantage. For more information on the area’s rental market, including latest trends with property management, contact the professionals at gkhouses.com and learn more today.