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Lake Martin property values continue to show significant increases compared to last year. Median sales prices for waterfront residential properties (single-family, townhomes, and condos) for the latest 12-month period increased 14.9% compared to the same period last year*. This increase continues a multi-year, double-digit increase in both average (12.1% increase) and median prices.
Current reporting by The Wall Street Journal (September 9-10, 2023 edition) indicated that this is a national trend that is in conflict with the results expected with much higher interest rates. The current national average interest rate is over 7.6% compared to roughly 3% just two years ago. Historically, higher rates have caused a slowdown in real estate sales and lower appreciation rates.
That historic effect on the national market has been blunted, according to The Wall Street Journal’s reporting, by a significant lack of “for sale” properties. That shortage, with a significant demand still in place, has caused sales prices to rise. There is a downside to this situation of course. The lower inventory has also caused the overall sales volume to decrease year over year.
Lake market beats the average
Lake Martin is beating the national average for median prices. The median price increase reported by The Wall Street Journal was 1.9%, which is significantly lower than the 14.9% increase noted above for Lake Martin. Our increase is due to continued low inventory. There are just 97 available properties at the end of August to supply last year’s 244 unit sales.
Coupling the low inventory with financially capable buyers and the wonderful draw of Lake Martin, demand remains firm which drives values of lake properties higher. That supply seems unlikely to change given so many people were able to lock in a very low interest rate for their lake property. As we have said in previous reports, those golden handcuffs keep properties off the market.
As we move into the fall and winter months, we expect the number of available properties to decrease due to lower buyer interest. That will reverse itself in mid-January and build to a busy spring season, as it always does.
We do not see, given the recent economic reports, any pressure to lower interest rates significantly in the next 12 months. Therefore, we expect that 2024 will be very much like 2023. From a property owner’s perspective, that is a very good thing.
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*The 12-month period this report is based upon is for the 12 months ending on August 31, 2023, and is derived from data gleaned from the Lake Martin Area Association of Realtors® Multiple Listing Service.