Scarce residential inventory drives up demand
for waterfront lots
With available waterfront residential inventory falling to levels not seen on Lake Martin for over a decade, potential purchasers are now buying lots at a faster pace. An analysis of the past 12 months of sales shows that the contraction in residential sales is being countered by increases in waterfront lot sales and construction volume.
For nearly a year, the number of residential properties available on Lake Martin has been falling. In fact, overall supply has dropped 7.7% below this same period last year. For the first time in memory, the number of single-family lake homes has persistently remained below 195 units. That is fewer than one house per four miles of shoreline.
Last year’s sales volume for single-family homes was 241 units, so supply is well below demand. Condo inventory is nearly gone with only 33 units for sale at the end of January. Last year, 72 units sold, so, by mid-June, we will be out of available condos unless current owners place properties on the market.
With dwindling supply, attractive interest rates, an improving economy (not to mention the beauty of Lake Martin), and fewer properties in “move-in” condition, something had to give, and it has; sales of waterfront homes sites have increased. For the past 12 months, the overall volume of lot sales has increased 23.1% over this same period last year.
The average sales price for a waterfront lot has increased by 33% (to $315,625), and the median price has increased by 22.5% over the same period last year as well. This increased sales volume has reduced the available inventory in the local MLS to just 90 waterfront lots at the end of July. Clearly, people are bravely choosing to build a lake home in this new environment.
Turn-key lake homes meet new demand From 2007 to 2014, the business of “homes built for sale,” or “spec” homes, was virtually non-existent. With the relatively robust inventory of homes then being offered at what could be described today as bargain prices, there was little opportunity for builders. Lake Martin remained a popular choice for second-home and retirement-home ownership, so the inventory of attractive lake homes has been decimated.
In 2012, Russell Lands began developing plans and neighborhoods where turn-key lake homes were an option. This program has been very successful. What it offers is a fully developed series of lake home designs that could be built on a variety of lots. See the new-construction homes currently available.
Once a homesite-and-plan combo is selected, customers can make custom changes and then receive a “turn-key” price. Nine to twelve months later (depending on start date and size), keys are delivered for a beautiful new lake home. This has proven to be a great option for many people. Our sales team has worked with their builder contacts to expand this concept across the lake—most recently at Cedar Point in the Real Island area. See an example here.
Market Predictions
Over time, the number of attractive and available lake lots will shrink as well. Developers like Russell Lands will continue to maintain a diverse selection of building lots and plans that are available through Lake Martin Realty. We are constantly working to find attractive building lots to marry potential lake owners with builders. This market will likely tighten past spring.
There are quite a few lots that were purchased last year by our builder clientele. Houses are now coming up on these lots providing a new supply of attractive lake homes. There are likely not enough to meet the demand that we expect to see this summer.
If you want to look at the best available inventory of existing lake homes, lake homes being built for sale or waterfront building lots, call me 256-749-7592 india davis or email idavis@russelllands.com.
How’d you like that view of Lake Martin to be yours?
