Market Report: Residential market remains strong

Waterfront home sales beat 2015 levels

The only thing hotter than the weather in July at Lake Martin was the real estate market. Real estate sales for the 12-months ending in July posted a year-over-year increase of 5.3% for single-family waterfront homes. This is a trend that began in January 2010 and has continued uninterrupted for more than six years.

Overall residential waterfront sales were up 3.7% over the same period last year, due to an 8.7% decrease in the volume of condominium sales. This decrease is related to the lower number of newly listed condos (6.4% fewer than last year). In spite of the lower volume, the median price of condos has increased 1.6% over last year.

Inventory levels continue to decrease for all waterfront property types, with the largest decrease in the single-family detached category, showing a 15% decrease in available properties for sale. The length of time it takes, on average, to sell a lakefront home has dropped from 187 days at the end of July 2015 to 164 days July 2016.

What most buyers and sellers really want to know is the average sales-price-to-list-price ratio. On average, a waterfront home sells for 94.1% of the list price and condos sell for 94.8% of list price.

Market Predictions

We believe that the market has leveled off – at an impressive sales level. While the market is still ahead of last year’s impressive sales levels, the trajectory of the increase has leveled off. This is due to the lower amount of new inventory coming to the market and the still low level of new construction opportunities.

With the limited number of newly developed waterfront lots, there is an additional constraint on available building opportunities. Popular lake neighborhoods report having a limited number of waterfront homesites available, with only The Ridge and Cedar Point providing any significant new home opportunities for traditional waterfront homesites.

Given the trends in lower inventory levels, prices will continue to rise — likely returning to peak levels by summer of 2017.