Articles & News
All systems go!
The last few words heard prior to the liftoff for the Apollo 11 mission to the moon were “All systems go!” This was the final summary statement for the different technical reports that all systems were ready for ignition and liftoff of the Saturn V rocket. And the rest, as they say, is history.
Lake Martin real estate is not nearly as important as that “One giant leap for mankind,” but the trajectory is nearly as impressive as rocket launch. A quick look at any waterfront sales metric reveals that all systems are indeed go.
Every month, we track the most recent 12-month period versus the same period last year. For the 12-month period ending on July 31, 2020, every property category and metric increased sharply compared to the 12-month period ending July 31, 2019. That is very impressive because 2019 was one of the best years on record for the sales of waterfront property on Lake Martin.
A look at the numbers
We rely on a number of resources to compile our numbers. One source is the University of Alabama’s Center for Real Estate. A look at their July report shows a sales trajectory that looks like a rocket launch (see the chart below). That is very impressive given COVID’s effect on the rest of the economy.
The second and more robust source of information is from our local MLS. Using this source of information, we can compile and track year-over-year numbers ending in July for several key metrics. The first is gross sales volume. Closed waterfront residential sales increased a whopping 43.2% over the same 12-month period last year. Clearly, people were looking for a “ready to enjoy” waterfront home for social distancing.
A second key metric is the total number of waterfront homes sold. That metric increased by 24% with 80 additional sales versus the same period last year. If you are wondering how the total volume increased by 43.2% and the unit sales only increased 24%, it is because the average price increased 15.1% to $657,935 for residential property (this included homes, townhomes, and condos). Single-family homes lead the way in this metric with an increase of 16.2% to an average price of $775,923.
This sales activity would have been even more robust had the amount of inventory been greater. The available “for sale” residential inventory at the end of July was just 113 properties, or a 3.32-month supply at the current sales pace, compared to 256 properties last year. Of that 113, roughly 35 were under contract waiting to clear due diligence prior to closing.
What to look for
We have noted a number of projections from others for what the market might do in the near future. We have an optimistic view given the lack of inventory, pent up demand, super low interest rates, and the increase in homesite sales (up 11.4%). It is our opinion that this trend will continue well into 2021 and beyond.
Fueling the demand is the rediscovery of Lake Martin as an alternative to urban living. Montgomery residents are discovering that the lake is a relatively short commute to work. Birmingham residents are discovering that working from a lake home is very attractive. Baby boomers are approaching retirement years, and a lake home is a great location for that season of life. Those discoveries are driving a property use shift from weekend getaway to full-time living.
We think for all those reasons and more that Lake Martin real estate will be a very attractive choice. We are making decisions about how to add new property choices to our neighborhoods so those wanting to make Lake Martin their home can have more options. To stay abreast of what is coming in the near future, call us at 256.215.7011 or drop us an e-mail request today.