With the first third of 2018 in the books, now is a great time to look and see how the Lake Martin waterfront real estate market is doing compared to prior years.
I took these statistics from the Lake Martin Area Association of Realtors’ Multiple Listings Service. These numbers represent the activity of all agents in our area – all brokerages, all sales. They do not take into account any sales by, for example, a “for sale by owner” or a private developer that did not use a member agent; however, I do think that the MLS is the best available source for information on the Lake Martin market.
Waterfront home sales in April 2018 were down compared to the same month last year. This year, 24 homes were sold, compared to 33 homes last year. I really like to compare the same month to prior years to ascertain a market direction, and any time a month loses to the prior year, I have to wonder if the market is taking a turn.
When we look at the year-to-date numbers, the story gets pretty telling. At the end of April 2017, a total of 114 homes were sold. By April 30, 2018, only 81 were sold, giving this year a daunting 30 percent loss to the prior year. When you look at it like that, it seems certain that 2018 might be the year of the cool-off of the market. Since 2017 was (what I consider to be) the best year ever for the Lake Martin real estate market, maybe a dip was inevitable.
But if we look at the second best year ever, 2015, we see that through April it scored about 84 homes sold, which is materially the same as 2018. History shows us that 2015 rallied heavily May through December and posted a total of 351 homes sold. When we consider that, maybe we should not write off 2018 too quickly. Maybe there is plenty of time left in the year to surpass 2017. If I had to guess, I would say Lake Martin would be lucky to approach 2015’s numbers.
The reason? Inventory. Comparing monthly sales versus inventory indicates that 2018 is fighting with an arm behind its back. There simply are not the same numbers of homes available to sell. This reminds me of why 2017 was so amazing: It had 34 percent better sales with 21 percent less inventory. Can 2018 pass its rivals with not as much gas in the tank? It would be difficult. My prediction is that Lake Martin will have another great year, but it won’t be the greatest. We simply need more homes on the market.
Is the story different for waterfront lots? Not really. If we look at the cumulative sales for 2018, we see that in four months a whopping 16 lots have been sold in the MLS. We should not be too surprised, because in 2015, the first four months of the year saw only 27 lots sold.
Inventory continues to be a lead theme in lot sales as well. Back in 2015, there were 151 waterfront lots for sale in the MLS in April. If you compare that to 2018’s 95 lots for sale, it means we have had a 37 percent decrease in lots available on the market. Since 2015 saw 27 lots sold through the end of April, if we subtract 37 percent from that, we get 17 lots sold, or about as many as have sold through the end of April of 2018.
Bottom line, if we had the same number of lots for sale as 2015, we probably would have the same number of sales. But the supply continues to be constricted.
One interesting thing is that there are a few new neighborhoods coming out this summer. Depending on how many get put on the MLS, Lake Martin might see lot inventory levels return to the same as 2015. Then at least we could see what the future holds.
John Coley is a broker and owner of Lake Martin Voice Realty. Visit his blog at LakeMartinVoice.com.