Montgomery, AL Housing Market: January 2025 Analysis

The Montgomery, AL metro area housing market in January 2025 presents a dynamic landscape with notable shifts in pricing, sales, and inventory. The Median Sales Price has risen to $254,822, marking a 4.2% increase year-over-year (YoY). This upward trend in sales prices is complemented by a modest 0.4% increase in the Median List Price, now at $245,000. These figures suggest a competitive market where sellers are achieving higher sales prices relative to their initial listing prices.
Price Per Square Foot has seen a significant rise, with the median Price Per Square Foot reaching $134.52, up 11.9% YoY. Similarly, the Median List Price per square foot has increased by 8.4% YoY to $137.66. These increases indicate a strong demand for housing in the area, driving up the cost per square foot.
In terms of sales activity, the number of Homes Sold has increased by 6.3% YoY, totaling 269 homes. However, Pending Sales have slightly decreased by 0.5% YoY, with 435 homes currently under contract. New Listings have seen a 2.2% increase YoY, reaching 421, which suggests a steady influx of properties entering the market.
Inventory levels have surged by 17.0% YoY, with 1,294 homes available, contributing to a Months of Supply figure of 4.80, which is a substantial 40.0% increase YoY. This rise in inventory and Months of Supply indicates a shift towards a more balanced market, potentially easing the competitive pressure seen in previous months.
The Median Days on Market have increased slightly by 2.0% YoY, now standing at 70 days. This suggests that while homes are still selling, they are taking slightly longer to do so compared to the previous year. The average sale to list ratio remains stable at 97.1%, with a minor YoY increase of 0.4%, indicating that homes are selling close to their asking prices.
The percentage of Homes Sold above list price has seen a slight increase of 0.5% YoY, now at 16.4%. Meanwhile, the proportion of Price Drops has decreased by 0.9% YoY, now at 19.0%, suggesting that sellers are pricing their homes more accurately from the outset. The percentage of homes going off market in two weeks has decreased by 4.7% YoY, now at 28.5%, indicating a slight slowdown in the speed of transactions.
Overall, the Montgomery, AL housing market in January 2025 reflects a period of adjustment with rising prices, increased inventory, and a slight moderation in sales velocity. These trends suggest a market that is gradually moving towards equilibrium, offering opportunities for both buyers and sellers in the coming months.
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