The Mobile real estate market, though cooling after a record couple of years, still remained a seller’s market in April, new data from the Alabama Center for Real Estate shows.
“We’re still in a seller’s market because we don’t have enough supply,” Charlie Plyler, president of the Mobile Area Association of Realtors, said.
In April, the total number of residential sales in Mobile was 386, a decline of 22.3% from the previous year. Prices remained high, though stable: the median sales price for a home was $225,000, the same median price as one year prior. The five-year average of the median home price from April 2018-April 2022 is $176,030.
Inventory remained low, with 1.7 months of housing supply available in April. That is an increase from the previous year, when there was 1.5 months of supply, but still far from where the market would be considered “neutral.” Plyler says that’s about 4-5 months of supply.
All signs point to a seller’s market, even if sales aren’t happening at the rate they were in 2021, Plyler says. Demand is still high, but supply isn’t able to keep up, because there are fewer homeowners willing to sell their homes, he says.
With high interest rates, there are fewer people willing to sell their home and buy a new one, as they would likely have to settle for a higher rate than they’re paying now, Plyler says. As a result, supply remains low, even though demand is still high.
Though conditions have eased since the highs of 2021, inventory remains low, and prices remain high. The average number of days a residential property was on the market in April was 38, a six-day increase from April 2022 but well below the five-year average, which was 51.
“This is a totally different market than we’ve ever seen,” Plyler said.
Demand is high, Plyler says, because of Mobile’s strong economy. There are many people moving from out of state into the Mobile area and looking to purchase homes.
Also contributing to the seller’s market is the increase in homes in the area being purchased outright, instead of financed, Plyler says. In a bidding war, a cash purchase is likely to win, he says. And many out-of-state buyers, who are able to profit off selling their previous home, can afford to pay cash in Mobile.
In addition, because the stock market remains in flux, many investors are looking to invest in real estate, and investors pay cash.
Plyler doesn’t anticipate the market slowing down anytime soon. Though he says he doesn’t know how the Federal Reserve will move forward with interest rates—if it will continue to raise them, keep rates steady or lower them again—he says he anticipates prices being high and the market still strongly favoring sellers for the time being.
“Mobile’s economy is strong, and people are moving both here and to Baldwin County,” Plyler said. “We’re in a better position, locally, than other cities of our size.”
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