Alabama Economic And Real Estate Report For July Shows Monthly Dip In Home Sales As Mortgage Rates and Market Indicators Continue To Favor Buyers
August 21, 2025
After two consecutive months of increases, home sales across the state took a dip in July with numbers falling 8.6% from June and 2.2% compared to the same period in 2024, according to the Alabama Economic and Real Estate Report released on Tuesday by the Alabama Association of REALTORS®.
Conversely, total home sales for 2025 are collectively 7.1% higher than the same point in 2024.
“Market conditions are continuing to move in favor of buyers in Alabama as mortgage rates are at their lowest level in almost 10 months, supply is increasing, and listings are at new highs,” Alabama REALTORS® economist Evan Moore said. “But there are signals of concern in the national economy with signs of the job market slowing, consumer sentiment falling, and indicators that inflation may pick up.”
Alabama’s median sales price of $228,759 experienced a slight drop of 2% month-over-month and 1.9% year-over-year, which translates to a decrease of $4,457 compared to July of 2024.
The sold dollar volume in July, which is the combined sales price of all homes closed during the month, was $1.75 billion — a 12.9% increase year-over-year but a 5.9% decrease from June.
Active home listings continued to rise for the fifth straight month and currently sit at a five-year high. The 20,698 homes under listing have increased by 19.2% compared to the 17,368 in July of 2024 and 2% relative to June. The economist noted that higher inventory provides buyers with ample selection among a wide variety of homes that fit their needs.
Houses remained on the market for an average of 66 days in July, which is three days longer than June and nine days longer compared to the same period in 2024
New home building permits in June fell 16.1% compared to 2024, and the 2025 year-to-date numbers are 5.5% lower than the same point last year. The report predicts additional declines going forward based upon economic trends.
Unemployment in Alabama was 3.2% in June, which is a slight decline after resting at 3.3% for nine consecutive months, and it remains below the 4.1% national rate. In addition, the state’s labor force participation rate stayed at 58% for the third straight month, which is the highest number in the state in a decade but continues to lag behind the 62.3% national figure.
Nationally, economic confidence fell for the first time in four months in August, with the Index of Consumer Sentiment declining 5.0% from July and 13.7% year over year.