A Look at Real Estate Trends in the Crestwood and Avondale areas of Birmingham

Housing Trends in Crestwood and Avondale are Looking Good

Have you been curious about home sales in the Crestwood and Avondale area of Birmingham? If so, I hope you will stick around because we’re going to take a look at past sales and current trends to see where this popular area of Birmingham is headed.

Both the Crestwood and Avondale neighborhoods are located just east of the downtown central business district of Birmingham in Jefferson County Alabama. They are adjacent to each other, with both experiencing a resurgence in popularity over the last several years.

Crestwood has been a popular downtown neighborhood for quite a while. When Avondale Brewing opened up several years ago, and the area was revitalized, the Avondale neighborhood underwent a resurgence as well.

Due to the age of the area little to no new development is possible, however, both neighborhoods have experienced renovation of existing homes. Buyers have flocked to these areas as downtown living has become more popular due to the revitalization and the addition of new restaurants and shopping choices.

Real Estate Trends by the Numbers

I recently completed some appraisal assignments in these neighborhoods and thought I would share with you what I found. If you have any questions feel free to leave a comment below or contact me by phone or email.

Historical Trends

I plotted out sales within the Crestwood and Avondale area of Birmingham over the past 20 years from 1998 to 2018 and the chart below shows the sales trend.

Most of the sales occurred in Crestwood, which has had higher demand within this time period. Avondale had less number of sales and the average sale price was lower, however, in the past year, Avondale did have a home sell for $575,000. This is $35,000 more than a recent high sale in Crestwood, which shows you that Avondale is catching up after trailing for so long.

After a lull in sales prices over the last several years prices have begun to increase due to an increase in buyer demand for homes close to the downtown central business district. As more and more millennials enter the market I anticipate that demand for these areas will continue.

Current Inventory

As is the theme in most areas across the country, the current inventory of homes in both of these downtown neighborhoods is historically low. They are at levels similar to 2004 before the real estate crash. Inventory levels started to build and fluctuated at a higher level until around 2014-2015 when sales began to rise and inventory levels dropped.

Throughout 2017 and 2018 there has been an average of approximately 3-4 months worth of inventory which indicates that the market is at the low end of being in balance. Lower levels would indicate a shortage and anything over six months would be an oversupply.

Days on Market

Because of the popularity of these two urban neighborhoods, listings do not stay on the market long. They are currently at the lowest since 1999. When priced competitively and marketed correctly it should not take more than about 30-40 days to sell a home.

One problem I see with areas like this is that sellers think they can price their home as high as possible and are confident it will sell but I disagree. Buyers are savvier today and they will not pay over inflated prices.

If sellers do this it will lead to longer days on the market and possible price reductions that could give an otherwise good listing a black eye to the public. Buyers will wonder why the price is being reduced in such a hot market, therefore giving the listing a stigma that something is wrong with the property.

The smarter way to set the listing price is to base it on recently sold similar homes as well as current active listings. This will ensure that it is priced competitively based on market data, which will help to sell it within a reasonable time period.

Renovation Trends

The popularity of this area among investors has driven the upward trend in sales volume and prices. They have recognized the demand among millennials to live in a more urban environment and investors have responded by buying older homes that have not been updated and renovating them to their former glory.

The home shown below recently sold within the Avondale area by agent Alan Alford of ARC Realty and is the highest price going back to 1999 per MLS records.

Within the Crestwood area, there have also been some record-breaking sales. Julie Harris with Ray & Poynor Properties sold this home within the past year. It exhibits the classic Crestwood architecture that so many buyers are seeking.

Conclusion

As I noted previously, the Crestwood and Avondale neighborhoods are some of the hottest areas in Birmingham. With the continued revitalization of downtown Birmingham and the addition of quality eating and shopping venues, this is expected to continue.

If you have any appraisal related questions please leave me a comment below and I’ll do my best to answer it. As always, thanks for reading.

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