By Joe Savage, Real Estate Broker
The ACRE (Alabama Center for Real Estate) at University of Alabama has published its statistics for April 2013 for Baldwin County condominiums, and they show some pretty good news for the area.
TOTAL CONDO SALES: This is just the raw number of condo sales in April. These are up 9.4% from March 2013, 8.6% from April last year, and 32.4% when compared to the five-year average of April sales for period 2008-2012! It appears the demand has returned.
MEDIAN SALES PRICE: This is the middle sales price…it is not an average. This is the sales price that has half of sales prices above it, and half below it. It removes the skewing effect that super high-priced sales and super low-priced sales (“outlyers”) would have on an average calculation. April 2013 was up 16.3% over March, 8.2% over April last year, and 9.4% over the previous 5-year April average (it’s ok to use the average here, as by using the median sales price, we have already adjusted for the “outlyers.”) It appears that the buyers have gotten the message that we’ve already hit bottom and are on the way back up.
ABSORPTION RATE: This is the inventory-to-sale ratio, and provides a good little snapshot statistic as it speaks to both supply and demand by dividing how many condos are for sale by how many sold for the month. It’s commonly referred to as the “absorption rate” as it projects how long it would take to absorb the current inventory at the current pace of sales. The bigger the number, the slower the market; the smaller the number, the hotter the market. ACRE considers the market to be in balance with an absorption rate of 6-7 months. April’s absorption rate was 7.0. That’s down from March’s 8.0 and WAY down from the 5-year average of 18.0! Demand is up, supply is down…that is likely conspiring to push that median sale price up, market-wide.
Now, this is for ALL of Baldwin County, including Daphne and the Eastern Shore as well as middle and north Baldwin. It is only a monthly snapshot, and so it is not realistic to try to get a comparable set of stats for GSP that could be considered valid. After June is complete, we will have a half-year of performance, and I will be compiling a set of year-to-date stats to see how GSP is faring relative to the market in general. Stay tuned!
