What's the Housing Market Like in New Hope, AL
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Prices | Trends | 2022 Forecast
New Hope is a mid-size town, 15 minutes south of the Tennessee border and just east of Huntsville, AL. It was formally known as Cloud’s Town in 1829 by its founder William Cloud but later changed to New Hope in 1883. Growth in the New Hope area has been positive with 2016 census estimate population of 2,808 residences. It is a very quiet town just outside of Owens Cross Roads making it a short 30 minutes commute to Redstone or Downtown Huntsville.
Like Huntsville, New Hope continues to be a seller's market. With the inventory of homes dropping down to near historical levels at 2.1 months (see bottom chart) in the New Hope area, prices on existing and new homes have steadily increased over the past few years. To gauge how low this is, an even market is 6 months of inventory. There should be no doubt, we are in a seller’s market and to be honest, with thousands of new jobs moving into this area with the expanding space and defense companies and the Toyota/Mazda plant being opened, there is no telling how much prices will increase this year. To make matters even worse, the building supply chain has been hit hard by the Coronavirus pandemic, bringing lumber prices to new highs. Talking to some new home construction builders, supply cost has risen to almost 300 percent. This has left them with no choice but to raise their home prices and in some instances several times over a one-month period.
When new construction rises, so does existing homes. I’ve heard of agents who had over 20 offers on their client’s home and in many cases, buyers enter into a pricing war where the sellers often get thousands above the asking price. It has also become a new norm to get multiple offers in many price ranges and popular areas. This market has also forced some buyers to put in escalation clauses in their contracts, meaning if their offer is at one price but the seller receives a higher offer, then the competing buyer is willing to escalate their contract for a determined amount more.
In a nutshell, demand for both existing homes and new construction are strong and will continue to be so in the near future. The Huntsville area, once considered as being one of the most affordable cities to buy a house has now become more competitive. Supplies and inventory are at a historical level, meaning there are fewer houses on the market than ever before bringing supplies to record breaking lows. This in turn has led to higher prices and less homes for sellers to select from.
I have listed below several interactive maps, displaying current prices, trends, and inventory of homes in the New Hope area to help you better understand our market.
Median Sales Price
The median sale price is the sales price in the middle of a data set when you arrange all the sale prices from the low to the high, unlike the average sale price which is calculated by adding all the home sales in a particular area during a defined period then dividing that total by the number of properties sold. Usually the local MLS will calculate the average sales price, while the median sale prices are the sale prices in the middle of the data when you arrange all the sale prices from low to high. The median sale price represents the figure at which half of the properties in the area sell at a higher price and the other half at a lower price. When using median, just remember “middle”. Although this may seem confusing, it is best to use both averages, median and average when selling your home and to help determine an estimated listing price.
Days on the Market
Another great tool used by realtors to sell your home is calculating the median number of days on the market. Realtors also use this number to help determine if the buyer should be aggressive on making a bid on an existing home. Generally, the longer a house sits on the market or listed on the multiple listing services (MLS), the bigger the discount a home may sell for. The opposite is also true, the shorter the days on market, the more aggressive buyers tend to be, thus allowing for higher prices.
Homes for Sale
The amount of homes for sale is a good indicator how stressed or healthy the housing market is. The more houses to choose from, the better it is for buyers. A low housing inventory means that sellers can increase their price as the competition for homes are much lower. Sellers can be a lot more aggressive in their asking prices if the housing inventory is low but must factor in selling the home at or below the appraisal price if the buyer is getting a mortgage loan.
Price Per Sqft
Price per sqft is a great tool to determine how much a seller should list their house for. In some cases, this can be misleading as homes in certain neighborhoods and school districts can determine the average cost of the home. The age of the house and amount of new or improved amenities can also determine the sale price of the seller’s home. Realtors will also use price per sqft when looking into new construction or trying to pinpoint a certain price in a particular neighborhood. This, along with housing comps (recently sold homes similar to your own house) helps determine a good selling price point.
Months' Supply of Homes for Sale
When investors research housing market trends, one of the best indicators to determine if the local housing market is trending towards a buyer's or seller's market, is the inventory of homes for sale. An even housing market, meaning a market that is neither a seller's or buyer's market but both trending the same, is having a 6 months’ supply of homes. When the number trends lower than 6 months, it is a seller's market. The opposite is true when the months’ supply for homes for sale trends above 6 months - it is a buyer's market.
Summary
As we enter the year 2022, New Hope has shifted to an even market. If you are a seller and are looking to move out of the area, now is the time to sell. For those who are looking to relocate or wanting to move into a larger home or downsize, I can help you too. I am both a listing agent and home buying expert. Check out my website to see my latest and current sales and reviews.
Any question or need further information? Send me a note.
For those who are interested in buying or selling a home, as a realtor with Legend Realty, I can help you with all your real estate questions or needs.
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Huntsville Valley MLS (by City)
Moving or Relocating the Huntsville Area? Check out the Huntsville's housing market. Jennifer Gates (256-755-4989) with Legend Realty.
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