Palms REALTY
Market Reports / Birmingham

Birmingham Market Report

Birmingham area. Home sales through August 2026, commercial through Q2 2026.

Key points

  1. Prices are still rising. The median home sold for $329,950 in August, up 6.4% from a year ago.
  2. Fewer homes are for sale. Listings fell 15% from last August, the first August drop in five years. Homes sold in 37 days on average.
  3. Borrowing costs more. The national 30-year mortgage rate hit 7.28% on October 1, up almost a full point from a year earlier.

Homes

MEDIAN SALE PRICE
$329,950
Up 6.4% from a year ago

Half of homes sold for more, half for less. Closed sales in August.

HOMES SOLD
1,180
Down 2.4% from a year ago

Closed residential sales in August.

DAYS ON MARKET
37
Down 3 days from a year ago

Average days from listing to contract for homes that sold.

HOMES FOR SALE
4,455
Down 15.4% from a year ago

That is 3.8 months of supply, down from 4.4. Under 6 months favors sellers.

Listings climbed four years in a row, then fell. Sales held steady.
01,0002,0003,0004,0005,0006,000Aug 2021Aug 2022Aug 2023Aug 2024Aug 2025Aug 2026For sale4,455Sold1,180
Homes for sale and homes sold each August, Birmingham area, 2021 to 2026.
Source: Alabama Center for Real Estate, University of Alabama Culverhouse College of Business, Birmingham Residential Report, August 2026, based on Greater Alabama MLS data, produced with the Birmingham Association of REALTORS. Mortgage rate: Freddie Mac 30-year fixed via FRED, October 1, 2026. Pulled October 8, 2026.

Commercial

Industrial

Birmingham
VACANCY
8.7%
Q2 2026

Share of warehouse and industrial space sitting empty, including sublease space.

ASKING RENT
$7.57
Up 6% from a year ago

Per square foot per year. Rents keep rising even as vacancy ticks up.

UNDER CONSTRUCTION
300,000 SF
Q2 2026

New industrial space being built.

TYPICAL CAP RATE
7.5% to 9.0%
Middle: about 8.1%

The yearly return an industrial property earns before any loan.

Vacancy, rent and construction: Cushman & Wakefield, Birmingham Industrial MarketBeat, Q2 2026. Cap rate: Palms Realty market composite.
Palms Realty market composites blend market data our team tracks with published research. Ranges show the middle of the market as of mid-2026. Cap rates are going-in rates, before any loan. Hospitality returns when we have enough current data.

What it means for you

Buyers

There are fewer homes to choose from and prices are up. Get a rate quote before you shop. At today's rates, one point of interest moves your payment more than a $10,000 price cut.

Sellers

Supply is down and homes sell in about five weeks. Price to the market from day one. A well-priced home moves. One priced high sits, even in a tight market.

Investors

Office space is plentiful and rents are flat, which favors tenants. Industrial rents are still climbing. Higher borrowing costs pressure prices, which can open doors for buyers with cash or equity.

General market commentary, not advice for a specific property. Talk to us about yours.

Terms used in this report

Median.
The middle value. Half above, half below. A few very expensive homes skew it less than an average.
Days on market.
Days from listing to contract.
Months of supply.
Homes for sale divided by homes sold in a month. How long it would take to sell every listing at today's pace.
Vacancy rate.
Empty space divided by total space.
Sublease space.
Space a tenant is paying for but offering to someone else.
Asking rent.
What landlords advertise. Signed deals often come in lower.

What do these numbers mean for your property?

Ask a broker