U.S. home prices hit a new peak in October, according to monthly figures, though the data-provider warned that the pace of growth cannot continue forever.
-- CNBC report Dec. 27, 2016, on the S&P/Case-Shiller U.S. National Home Price Index
The average price of a home sold on the Eastern Shore of the Mobile, Ala., metro area in 2016 was $272,840; the median, $237,207.
That’s fairly pricy, considering Zillow reports that the median home price in Alabama in 2016 was $171,500.
At the moment, the cheapest brand new home on the Eastern Shore is $179,000, while the cheapest new home for sale in the city of Mobile is $144,950, some $34,000 less.
I want you to feel better before I rip the Band-Aid off.
Eastern Shore home sale prices were virtually flat in 2016 (actually they fell 0.03%). And while the number of homes sold rose 6.89%, all those gains were because of new construction in Spanish Fort, Daphne and Fairhope.
New homes, which represented 27% of all sales in 2015, grew to 31% of sales (or 594 homes) in 2016. New home prices were up 2.3% in 2016.
And certain home builders have honed in on the sweet-spot of pricing on the Eastern Shore: buyers spending between $200,000 and $300,000, which represented 52% of new home sales.
Meanwhile, the number of existing homes sold was down 1.14% in 2016, and the average sales price of these homes was down 1.5%.
National market analysts cite these reasons in predicting a slowdown in home prices:
- Rising mortgage interest rates
- Home prices outpacing gains in wages and personal income
- Overall affordability
On to the numbers:
In 2016 on the Eastern Shore, 1,892 homes sold with an average price of $272,840, compared to 1,772 sales in 2015 with an average price of $272,905. Sellers took 2.6% off the list price, on average, in order to sell. It took on average 141 days to sell. In the 4th quarter, 436 homes sold with an average price of $284,687. In the 4th quarter of 2015, 376 homes sold with an average price of $283,160.
Spanish Fort: (Note: these numbers are sorted by the 36527 zip code and include some areas in Loxley and Daphne). 362 homes sold in 2016 with an average price of $271,274, compared to 294 sales with an average price of $297,173 in 2015. Sellers shaved 2.2% off their list prices in order to close. Days on market stood at 152. In the 4th quarter, 95 homes sold with an average price of $274,031; while 61 homes sold with an average price of $295,372 in the 4th quarter of 2015.
Daphne: 773 homes sold in 2016 with an average price of $228,537, compared with 742 sales in 2015 with an average price of $233,433. Sellers lowered their expectations 2.25% in order to sell. And it took 139 days on average from list to close. In the 4th quarter, 171 homes closed with an average price of $242,901. In the 4th quarter of 2015, 150 homes sold with an average price of $252,511. Sellers trimmed 2.7% off their list price in order to sell. Days on market stood at 142.
Fairhope: 807 homes sold in 2016 with an average sales price of $313,763. That compares to 736 sales with an average price of $303,004 in 2015. Sellers adjusted their prices 2.6% in order to close, and it took on average 139 days to sell. In the 4th quarter, 170 homes sold with an average price of $332,416, compared with 165 sales with an average price of $306,507. This was boosted by the sale of eight $1 million-plus properties. Sellers settled for 3.1% less than list price in order to sell. Days on market stood at 143.
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