Buy a home now to avoid the Space Command rush in Huntsville? Here is why that might be a good idea

The relocation of U.S. Space Command headquarters to Redstone Arsenal could drive up home sales prices in north Alabama, according to local realtors.

“Right now, Huntsville has about 4,600 homes on the market,” realtor Matt Curtis told AL.com. “Add roughly 1,700 Space Command jobs into the mix, and that can put a big dent in our supply—quickly tightening the market and driving up competition and pricing.”

“We knew it was going to happen, but I guess that it is more official now,” added Ben Wales, of Gateway Alabama Realty Group. “Most of the people moving here with Space Command will probably want more expensive houses but hopefully all ranges will see an uptick. I will miss shopping with buyers in the current low stress scenario that we have right now. “

U.S. Rep. Dale Strong, R-Monrovia, said the relocation could add up to 4,700 jobs locally, including 3,000 spinoff jobs. But President Donald Trump puts the number of jobs at 30,000. And that’s on top of the 2,200 FBI jobs Mayor Tommy Battle expects to come in the next five years.

“Currently, single-family prices are holding steady around $320,000,” Curtis said. “Add hundreds of new high-paying jobs, and we could shift from flat pricing to double-digit appreciation once these jobs begin to materialize.”

According to the Huntsville Area Association of Realtors’ Valley MLS data, there has been little movement in the median home prices in the area in more than a year.

“Huntsville currently has about 4.4 months of housing supply, a balanced market,” Curtis said. He said Space Command’s relocation could drop supply below three months “shifting us back into a seller’s market with the kind of competitive conditions we saw during the boom years.”

During the first years after the pandemic, supply became tight. Homes in the Huntsville market stayed on the market for an average of less than two weeks in 2021 and 2022. By comparison, homes stayed on the market in Madison County in July an average of 47 days. During the frenzy of 2021-22, home sellers were receiving offers well above their asking price.

“The Housing Affordability Index is holding steady at 91, but if demand spikes and prices climb, affordability would likely take a hit,” Curtis said. “Huntsville would benefit from growth, but we also need to prepare for the affordability challenges that come with it.”

Housing affordability was one of the metrics in Huntsville’s favor in the competition for Space Command. According to Realtor.com, the median home price for Colorado Springs, the current home of Space Command headquarters was $475,000 in June.

Impact on rental market

Curtis believes the rental market could also be affected by Space Command’s relocation to Huntsville.

“Many incoming personnel will rent before they buy, which means landlords can expect lower vacancy rates and higher rents,” he said. “We currently have an oversupply of rental housing, so this will bring the market back into balance.”

According to Crunkleton Commercial Real Estate land specialist David Wilson, Huntsville’s recent apartment boom had been slowing because of the oversupply. There were no apartment units up for final approval at August’s Huntsville Planning Commission meeting.

Wilson said the current apartment occupancy rate us in the low 80% range. Because of that, the average rent had actually declined. According to the Waller, Weeks and Johnson Rental Index at the Alabama Center for Real Estate at the University of Alabama, the average rent in Huntsville as of July was 1,464, down from down from $1,595 in December 2023.

“It’s too early to tell what impact Space Command and the related Golden Dome project will have on Huntsville’s multifamily market, but it will certainly be very positive,” Wilson said. “It will also provide a much needed psychological boost for multifamily owners and lenders as they’ve been grappling with a challenging multifamily supply cycle the past two plus years, as has the majority of the country.”