Articles & News
Limited inventory creates a drag on the market
Forty-one, not forty-two, forty-one. That is the total number of available waterfront properties listed “for sale” in the Lake Martin Area Association of Realtors® MLS at the end of February 2022. That is exactly 324 properties shy of the 365 properties sold through the MLS in the last twelve months.
Given that sales pace, local Realtors® will be completely out of available property in 1.35 months. This shortage of property is unusual, since this is the time of year we are used to seeing an increase of available properties. Historically, the best time to sell is at the start of “lake season.” Given our current inventory, we can surmise two things.
The first is that we will not have enough property to meet pent-up demand for lake homes. The second is that current property owners love their lake homes too much to part with them. Even those desiring a lake upgrade are reluctant to sell since there is not a suitable replacement property available.
Metrics tell the inventory story
A look at the year-over-year numbers for the 12 months ending on February 28, 2022, are very interesting. Due to the severe lack of supply, the total number of sold residential properties decreased 132 units or 25%. The gross dollar volume decreased as well to $315,539,404 or 11.4%.
So, if units sold decreased 25%, and gross dollars decreases only 11.4%, then the average price must have increased. As you might expect, prices did in fact increase. The average single-family waterfront home sales price increased 18.1% to $977,713.
This dramatic increase in the average price is impressive, especially when we look back at this same reporting period last year when the annual increase in the average price was 20.1%. This is a two-year, back-to-back, double-digit increase in average price. Property values on Lake Martin have steadily increased since 2019, and given the available supply, we expect this trend to continue.
Waterfront lots are becoming scarce
Considering the lack of “ready to use” lake homes and the great attraction of Lake Martin, many people are opting to acquire a lake lot to build their personal “ideal” lake home. Over the last year, 130 waterfront lots have sold. The vast majority of those sales are for custom lake homes, not speculative construction.
Creating new lake lots has a long lead time, so the current supply of lake lots has dropped to an all-time low of just 37 properties in the local MLS. Currently, there is just a 3-month supply of available waterfront homesites available. Inventory for ready-to-build lots in Russell Lands neighborhoods is at a historic low with The Ridge and The Willows down to just a small handful of available properties.
What to look for
Given low inventory and the fast-approaching lake season, we think there will continue to be competition for available homes—many times selling before the properties are entered into the MLS. Finding a local agent is critical for a potential buyer to be “in the know” prior to a desired property going on the open market.
New waterfront lot inventory will be coming in The Heritage (Russell Lands’ newest master-planned development) complete with the new Coore & Crenshaw golf course, Wicker Point Golf Club. Currently, the development is in the road-construction phase for its first residential offering.
This first phase will provide a very attractive collection of waterfront homesites this summer. Given the demand for The Heritage, we recommend you reach out to one of our Realtors® to receive early information on this beautiful property.