The state's housing market continued to decline into the new year, but the decline in winter sales was not unexpected. However, the group warned that sales are expected to decline during the winter season.

That's according to the latest report released this week by the Alabama Association of Realtors.

The group said a number of factors contributed to the decline, including a nine-week decline in average 30-year fixed mortgage rates that began in early November and ended last month. Additionally, mortgage rates rose less than 1 point in 10 from 6.62% to 6.69% in January.

The numbers did not improve in February, with mortgage rates rising again in mid-month to 6.77%. Economists argue that a combination of recent positive news in the domestic economy and higher-than-expected inflation is causing upward pressure on mortgage rates, which reduces the likelihood of a target cut in the federal funds rate. are doing.

““Many homeowners are reluctant to give up their current fixed low mortgage rates to purchase a new home at today's higher rates,” said Jeremy Walker, CEO of Alabama Realtors. said. “Until the Fed provides relief in the form of rate cuts, Alabama and other states will continue to battle the same economic headwinds that have plagued the industry over the last year. ”

Realtor President Senia Johnson is optimistic about the market in the coming months.

““We believe the arrival of spring and summer will bring welcome activity to the housing market and help start what we hope will be an upturn,” she said.

The number of home sales in January was 4,686, a decrease of 42.1% from the previous year and the lowest sales value in five years.

Austin Shipley is a staff writer at Yellowhammer News.