Cullman Real Estate Sales Jump; Available Homes For Sale Dwindles
Prices Rise 2.2% Over 2016
Rising residential real estate prices coupled with a tightening market supply of homes could not detour June 2017 home sales from jumping significantly from June 2016.
According to the Cullman MLS, Cullman County area, residential real estate sales totaled 73 units during June 2017. That is up a whopping 22 percent from the same month a year earlier.
Simultaneously, the Cullman County area’s housing inventory totaled 523 units in June 2017. That is down 11 percent below the supply in June 2016.
For comparison, Cullman’s peak inventory was 948 units in June 2010 in what was an actual ‘buyers market.’
The inventory-to-sales ratio in June was 7.2 months of housing supply. Restated, at the June sales pace, it would take 7.2 months to absorb the current inventory for sale. This rate is 60 percent lower than the 2010 peak (18.1 months of supply). The market equilibrium (balance between supply and demand) for June is approximately six months.
The median sales price for a home in Cullman County during June 2017 was $134,900. This median sales price was 4.7 percent above the prior month!
The peak high selling price in Cullman for June was back in June 2014 when the median price was $147,200.
This gain reflects a slight increase of 2.2 percent from June 2016 ($131,950).
The average sales price for a home in Cullman is currently $181,607.
The Difference Between the Median Sale Price and Average Sale Price
The problem with the average sale price is that if one or more properties sold at an extraordinarily high or low price, the average is skewed higher or lower as a result. In this case, the average becomes a somewhat unreliable metric. The median sale price, on the other hand, is the sale price in the middle of the data set when you arrange all the sale prices from low to high.
The median sale price, then, represents the figure at which half of the properties in the area sell at a higher price and another half at a lower price. The U.S. Census Bureau lists national median and average sale prices for the past several decades, and the Federal Housing Finance Administration uses these and other figures to create the House Price Index.
Note: Pricing can fluctuate from month to month as the sample size of data (closed transactions) is subject to seasonal buying patterns.
All of the above is positive news, particularly if you are a residential real estate seller. The above data suggests a ‘seller’s market’ in the making.
The only worrisome data point involves a lack of demand for residential homes.
June residential sales decreased 25 percent from May. This drop in direction contrasts with historical data indicating that June sales on average (2012-16) increase from May by 4.6 percent.