By: ACRE Research
Sales: According to the Lake Martin Association of Realtors, waterfront-area residential sales totaled 29 units during September, down 23.7 percent from 38 sales in the same month a year earlier. Results were 9.4 percent above the five-year September average of 32 sales.
Inventory: Homes listed for sale in the waterfront area during September totaled 284 units, an increase of 24 percent from September 2017’s 229 units and a decrease of 9.6 percent from August 2018’s 314 units.
Pricing: The Lake Martin waterfront median sales price in September was $400,000, a decrease of 33.2 percent from one year ago and a decrease of 16.9 percent from the prior month. This direction is inconsistent with historical data (2013-17) indicating that the September median sales price on average increases from August by 12.7 percent. The differing sample size (number of residential sales of comparative months) can contribute to statistical volatility, including pricing. ACRE recommends consulting with a local real estate professional to discuss pricing, as it will vary from neighborhood to neighborhood. The average number of days spent on the market (DOM) by waterfront homes that sold during September was 132 days, a decrease of 18 percent from 161 days in September 2017, and a decrease of 41.1 percent from 224 days in August.
Forecast: September sales were eight units, or 21.6 percent, below the Alabama Center for Real Estate’s (ACRE) monthly forecast. ACRE projected 37 sales for the month, while actual sales were 29 units. ACRE forecast a total of 283 residential sales in the waterfront area year-to-date, while there were 242 actual sales through September.
ACRE’s statewide perspective: While nationwide sales declined during September, residential sales in Alabama continued to grow during the early fall of 2018. Total residential sales in Alabama increased 8.5 percent year-over-year from 4,678 to 5,074 closed transactions. Year-to-date through September, statewide residential sales are up 6.8 percent from 44,272 one year ago to 47,283 currently. Home price appreciation in the state grew, but at a slower pace than in previous months. The median sales price in September increased 0.6 percent from $161,480 to $162,482, while the year-to-date median sales price is up 4.4 percent from 2017. Although nationwide inventory levels are starting to stabilize, Alabama’s residential inventory decreased 8.9 percent from one year ago. Low inventory levels were a major factor contributing to rising sales prices throughout 2018. With low inventory levels, it is not surprising to see homes selling more quickly than in previous years. Homes selling in Alabama during September spent an average of 90 days on the market, an improvement of 18 days from 2017.
NAR’s national perspective: During September, nationwide sales volume for existing homes decreased 9.1 percent year-over-year from 462,000 to 420,000 closed transactions. According to Lawrence Yun, chief economist for the National Association of Realtors, rising interest rates played a significant role in September sales declines in markets across the nation. “This is the lowest existing home sales level since November 2015,” he said. “A decade’s high mortgage rates are preventing consumers from making quick decisions on home purchases. All the while, affordable home listings remain low, continuing to spur underperforming sales activity across the country.”