AUGUST 2008 MARKET UPDATE

Year-to-date and August 2008 HOME SALES

Birmingham Association of Realtors and its Multiple Listing Service

Year-to-date and August homes sales statistics of the Birmingham area residential real estate market continue to show signs of the sluggishness. Total sales are down, as are prices, yet there are some positive signs: MLS inventory continues to move in the right direction with 11,914 listings in August compared to 13,582 in August 2007. This represents 1,668 fewer listings in MLS now compared to one year ago. The Year-to-date report shows the average price of Birmingham area homes has dropped 2.6% which is less than what is happening in other markets around the country.

Government action has been taken to inject new life into the sluggish real estate market, including passage of the Housing and Economic Recovery Act of 2008, the takeover of Freddie Mac and Fannie Mae, and the recent boost in loan limits.

Current conditions are ideal for buyers. Year-to-date average prices in MLS show a 2.6% decrease. These conditions won't last long. Now is a great time to make an offer on a home.

Mortgage loans are available. Contrary to perceptions, conventional mortgages are widely available.

Inventory is wide-ranging with many choices in prices and architectural styles.

We are listing and selling houses. Birmingham MLS members have sold over 9,000 homes since the first of the year. Don't compare this year with last year or the year before because 2006 and 2007 were record sales years for our MLS.

What happens when someone buys a home? NAR Chief Economist Lawrence Yun reminds us that each home sold contributes to the GNP. Here's a 2001 example...a typical first-time buyer spent $3,500 on furniture, carpet, painting, faucets and other items after purchasing a home. Trade-up buyers spent $5,000. Today these numbers would add up to much more. Income is generated when someone buys a home. An inspection is ordered along with a survey and title search. The home is appraised. The loan is closed. Moving trucks are on the scene. Everyone gets paid. Everyone spends some money. They may go to dinner at the local eatery. The restaurant makes money. The owner buys a new plasma screen TV. The electronics store manager makes money. He takes his family on a long-planned vacation. The resort he chooses makes money and hires an additional worker. This positive economic cycle takes place with the sale of each home.

AUGUST REPORT

August 2008 Total Sales: 1,146

August 2007 Total Sales: 1,690

This represents a 32% decrease in total sales for this month

August 2008 Average Price: $189,587

August 2007 Average Price: $193,646

This represents a 2% decrease in average price for this month

August 2008 Median Price: $150,300

August 2007 Median Price: $159,900

This represents a 6% decrease in median price for this month

August 2008 Days on Market: 94* adjusted to exclude new home sales

August 2007 Days on Market: 96* adjusted to exclude new home sales

August 2008 Inventory: 11,914

August 2007 Inventory: 13,582

This represents 1,668 fewer listings in the MLS for this month

YEAR-TO-DATE REPORT (January through August)

2008 Total Sales: 9,055

2007 Total Sales: 12,659

This represents a 28% decrease in total sales (same decrease for the past 3 months)

2008 Average Price: $194,598

2007 Average Price: $199,713

This represents a 2.6% decrease in average price

Still some good news...prices have not dropped lower than this point all year

2008 Median Price: $159,100

2007 Median Price: $161,100

This represents a 1% decrease in median price

2008 Days on Market: 100* adjusted to exclude new home sales

2007 Days on Market: 93* adjusted to exclude new home sales

YEAR-TO-DATE REGIONAL BIRMINGHAM METRO REPORT:

2008 NORTH Total Sales: 637

2007 NORTH Total Sales: 789

This represents a 19% decrease

2008 SOUTH Total Sales: 4,295

2007 SOUTH Total Sales: 6,225

This represents a 31% decrease

2008 EAST Total Sales: 2,466

2007 EAST Total Sales: 3,459

This represents a 29% decrease

2008 WEST Total Sales: 1,657

2007 WEST Total Sales: 2,186

This represents a 24% decrease

These statistics compare total residential sales for August 2008 vs. August 2007 as well as Year-to-Date statistics as compiled by the Birmingham Area Multiple Listing Service, Inc. of the Birmingham Association of REALTORS®. Neither the Birmingham Association of REALTORS® nor its MLS guarantees or is in any way responsible for its accuracy. Any market data maintained by the Association or its MLS does not necessarily include information on listings not published at the request of the seller, listings of brokers who are not members of the Association or MLS, unlisted properties, rental properties, etc.