The monthly report showed that Alabama experienced 6,938 homes sales in May, an increase of 11.7% over April and also 11.7% more compared to the same period one year ago, which Moore said indicates “strong momentum” in the state’s real estate market.

At the same time, Alabama’s median home price increased 5.9% month-over-month and a healthy 16.6% year-over-year, growing by $39,670 in May to $279,185.

The sold dollar volume in May, which is the combined sales price of all homes closed during the month, was $2.19 billion, a 19% increase month over month and a 28.8%, or $0.49 billion, increase compared to the same period last year.

The 21,241 active monthly listings at the end of May were 7.8% higher than the 19,709 of one year ago and 1.5% higher than the 20,928 in April, and the 61 days on average that homes remained on the market was only two days longer than April and three days more than one year ago.

Over the last 40 years, the 30-year fixed mortgage rate averaged 6.52% and 7.67% over the last 50 years, but the May 2026 average rate of 6.44% remained below that historical range for the ninth consecutive month. While the May value marks the third consecutive monthly rate increase, it is significantly below the 6.82% average of one year ago.

The 4.4 months of housing supply in May decreased slightly from the 4.8 months in April and the 4.5 months of the same period in 2025, and economists predict further reductions as the summer season continues. Housing supply estimates the number of months it would take for all homes currently on the market to sell.

According to the latest figures available, Alabama’s unemployment rate in April was 2.8%, which was a slight increase following five consecutive months at 2,7%, but it remains significantly below the national rate of 4.3%. Following revisions from the federal Bureau of Labor Statistics, April was the thirteenth consecutive month in which the state’s unemployment remained below 3.0%. Alabama’s labor force participation rate fell slightly in April to 57.3% compared to the 57.5% in March.

New home building permits continued a three-month trend of annual increases with the 1,612 permits in April rising 12% over April of 2025 and increasing by 1.2% over March.

Though rising home prices may create affordability issues for some first-time buyers, the economist predicted that supply increases and new home construction will offer a measure of relief to those seeking to purchase this summer.

“Moving into June, as sales are projected to rise and mortgage rates potentially ease following the recent Islamabad MOU interim peace deal with Iran, this blend of expanding choice and rising prices will likely define the summer buying season,” Moore said.