You May Be Busier Than Ever As Alabama’s 2021 Real Estate Market Heats Up
Despite the onset of the COVID-19 pandemic last year, the Alabama real estate industry has remained strong. In 2021, markets across the state are forecasted to continue that momentum. With high demand, waning unemployment rates, and rapidly rising home sale prices, real estate agents all across Alabama should gear up for another booming year.
2021 Alabama Real Estate Outlook: Heating Up
In November 2020, the average home in Alabama was priced at $156,265, an 8.2% increase year-over-year. There’s little sign of prices stalling, though, as Zillow predicts this figure will rise another 10.3% within the next year. Rising prices echo the gradual healing of the economy statewide, signaling that this year could be profitable for agents and sellers alike, while low-interest rates maintain some degree of affordability for buyers.
Along with rising home prices, home sales statewide grew 25.8% year-over-year in October 2020. Inventory also fell a significant 33.8% during that same period. Between lasting low-interest rates bolstering demand and a consistently low supply, Alabama looks to be a seller’s market as 2021 unfolds.
After the economic tribulations of 2020, rent prices increased only 0.6% statewide and, as more and more people relocated to Alabama’s cities, grew 5.6% in the Birmingham metro area. Meanwhile, only 0.7% of Alabama homeowners fell delinquent on their mortgage, and equity slipped into the negative on only 3.1% of homes statewide. So, while new renters and buyers alike flock to Alabama, current homeowners continue to thrive as well.
2020 Alabama Real Estate Market Data
|Zillow Home Value Index||$156,265|
|1-Year Change on Home Values||+8.2%|
|1-Year Change on Rent Prices||+0.6%|
|Homes With Negative Equity||3.1%|
|Delinquent on Mortgages||0.7%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for Alabama
In November 2020, the Alabama Department of Labor reported that Alabama’s unemployment rate had dropped 1.3%, landing at 4.4% statewide. A full two percentage points below the national average, Alabama’s job market shows promise. As healthy economic activity often correlates with growth in the real estate industry, narrowing unemployment rates are a positive sign for agents the year ahead.
Despite the traditionally hot spring and summer buying seasons far behind us, closed sales increased a whopping 23.3% year-over-year in November 2020. This momentum illustrates a departure from the typical seasonality of home buying and is a good sign for the coming winter months. Buyers are still eager to commit, even without the draw of spring curb appeal and warm-weather open houses.
This momentum isn’t limited to just residential either as commercial real estate is heating up too. In November 2020, 37 major real estate projects coming to the Birmingham area were announced. Highlights include a 1.2-million-square-foot Lowe’s facility, 600,000 square feet of Amazon facilities, a nearly 300,000 square-foot FedEx distribution center, and a Carvana distribution and fulfillment center. These major corporations setting up shop in Birmingham is yet another bright spot for the Yellowhammer State.
With a strong 2021 forecasted, Alabama real estate agents will need to be at the top of their game. From buyers battling rising prices to sellers fielding multiple offers, there has never been a better time to serve your fellow Alabamians. This year, agents can expect to benefit from and help contribute to a booming local and national economy as the Alabama real estate market heats up.
Take On 2021 With the Best Alabama Real Estate Courses From The CE Shop
Enroll in our Pre-Licensing program now to get your career started and begin connecting your fellow Alabamians with the home of their dreams. Or keep going strong with one of our comprehensive, 100% online Continuing Education packages. Want to stay up to date on everything Alabama? Join the Southern Real Estate Facebook Group!