3 reasons why home sales remain strong in Birmingham, especially for first-time home buyers

Birmingham, Alabama, real estate, home buying
While the housing market is primed for sellers right now, home buyers are showing confidence in Birmingham. Photo for Bham Now

Home prices are rising, construction is stalling and supply is low, leading to speculation about another housing bubble boiling up the U.S. real estate market. That’s not the whole story, though. Here’s why the home market looks hopeful in Birmingham:

  1. Change Is Here

Yeah, yeah, yeah. We’ve heard the negative news. Birmingham is not growing. It’s shrinking, actually, according to the most current (2010) U.S. Census. Birmingham lost 1,527 people from 2010 to 2017.

An eco-creative celebration.
Birmingham continues to grow culturally, and that’s attractive to first-time millennial home buyers. A shopper at the 2017 Moss Rock Festival. Photo for Bham Now

These cities in Jefferson County saw some big declines in population compared to the rest of the state: Bessemer, Center Point, Fairfield, Mountain Brook and Pleasant Grove. The bright spot? Bessemer just gained an Amazon distribution center. New jobs mean people, and people need houses, preferably close to work.

The Urban Land Institute sees that Birmingham, like many other cities, is changing. And, with that change, comes opportunity.

Birmingham, Alabama, home buying, guide

First-time home buyer? Overwhelmed? Check out our guide!

“Our cities are evolving into places that are more diverse and more interesting than ever, with a mix of neighborhoods defined by distinct characteristics that are drawing different residents and workers for different reasons,” said ULI Terwilliger Center Founder and Chairman J. Ronald Terwilliger.

FullSizeRender 309 3 reasons why home sales remain strong in Birmingham, especially for first-time home buyers
Woodlawn’s newest mural at 6 55th Place near 1st Ave. South. Photo by Pat Byington for Bham Now.
Urban + Suburban = Surban

The ULI report  suggests potential growth trajectories, including residential growth. Birmingham was noted for showing residential growth, reflecting a transformation of depressed areas into diverse and distinct areas. That means urban areas are turning a little more suburban, and that’s attractive to home buyers.

Birmingham Alabama
Regions Field at night. Photo for Bham Now

Yep. We’re talking about mixed-use districts: urban development that combines residential, commercial, cultural, institutional and entertainment uses that are connected (which also connects public transit). These are known as emerging economic centers.

Here are the numbers:

  • Seattle has the largest percentage of residents (13 percent) living in economic centers, followed closely by Washington D.C. and San Francisco (10 percent each).
  • Jacksonville, Florida has the most residents (12 percent) in emerging economic centers, followed by Birmingham, Alabama (11 percent).
  • New York City has the largest number (26 percent) in mixed-use districts, followed by Chicago (23 percent).
FullSizeRender 158 3 reasons why home sales remain strong in Birmingham, especially for first-time home buyers
East Lake Neighborhood sign on East 59 Vintage & Cafe at 7619 1st Ave. North

Our neighborhoods are changing, with demographic and economic trends shaping their development. This means we have an opportunity to shape our communities during this transformation, too.

Highland Park townhouse development
Image courtesy of Highland Park Neighborhood Association

Accommodating a variety of budgets, from those looking to purchase high-rise condos, along with affordable housing that’s convenient to Birmingham’s amenities and services, is key to maintaining diverse and thriving neighborhoods, according to the ULI report. Hello, Birmingham!

Birmingham, Alabama, home buying, guide
Home sales are growing in Birmingham, despite dismal national forecasts. Photo for Bham Now
2. Home Sales Are Up

According to the Greater Alabama Multiple Listing Service, Birmingham metro-area residential sales totaled 1,513 units during April, 18.4 percent above the same time last year

The University of Alabama’s Culverhouse College of Business, via the Alabama Center for Real Estate’s (ACRE) also reports that homes sales are up in May, as well. Sales were 189 units or 12.5 percent above the  monthly forecast.

Despite low-inventory and rising interest rates, Birmingham is still selling homes. Why?

3. Confidence in Birmingham

Research from the National Association of Realtors found that millennials are the largest group of home buyers, making up 65% of all first-time home buyers last year. 85% of millennial buyers are the most likely generation to view their home purchase as a solid investment.

Birmingham AL
A Crestwood North neighborhood gathering. Photo courtesy of Crestwood North Neighborhood Association

Where are they buying? In urban growth pockets, like Birmingham. Linking affordability to desirability is key. Millennial home buyers want good schools because they have children, but they also want walkable neighborhoods that are close to amenitieslike breweries, baseball fields, grocery stores, parks and restaurants.

grocery publix
The Publix in downtown Birmingham. Photo for Bham Now
The Takeaway

Mixed-use neighborhoods in proximity to good schools (a different discussion for a different post) are the key to attracting first-time buyers, who are displaying the most confidence in purchasing a home as an investment. These customers are looking for places to live with all the fun and accessibility a city offers, but they want it to be affordable. Birmingham, are you listening?

Articles: 290