Lake Martin waterfront sales have not been especially brisk, but at least we have beaten the prior year in the last two months.
In September, there were 20 waterfront homes sold in the entire Lake Martin MLS*, which represented a 25% increase from September 2007. October 2008 saw 15 homes sold as compared to only 8 in October 2007. While that is positive news, I still don’t feel like we are in the heady rush of an upswing in sales.
Here’s the monthly sales chart:
We still haven’t sold more homes cumulatively as compared to 2007. The Lake Martin realtors would need to sell 29 homes total in November and December to do that. We might come close, but I doubt it. Here is the cumulative comparison chart:
Another bit of good news it that total active listings on the Lake Martin MLS have come down for the third month in a row. See below:
All of these backward looking charts are great, but the thing that people ask about the most is the future. Where is the Lake Martin real estate market headed? What about waterfront property around the country in general?
For all of you Lake Martin Voice Readers who want extra points, please read this excellent post by Nicolai Kolding on the Better Homes and Gardens Blog. I don’t know if he came up with this or not, but the basic gist is that a great way to understand the cycles of real estate is to study transaction sides (# of sales) and average sales price. This may seem elementary until you see what is driving what – average price changes lag BEHIND transaction sides. In other words, changes in # of sales foretell changes in prices.
This is not some hocus pocus, he backs it up with cold hard numbers and observes market periods long enough ago that we can all agree were sellers’ or buyers’ markets. Check out his supplementary post here, and download the spreadsheets to check the numbers yourself.
We have a disadvantage here in the Lake Martin waterfront market in that our average sales prices are all over the map. As I have said before, our small sample sizes of sales mean that we have a wide difference month to month in average sales price. Any time you have a wide difference or deviation, statisticians tend to throw out the results. Think of trying to predict the presidential election by only asking 1 person. It wouldn’t be very accurate. If you ask one million, well, depending on the sample, it will be more accurate. Asking 10 million, even more accurate. We can’t look at short term average sales price changes on waterfront homes on Lake Martin and infer very much.
But we can keep a close eye on total sales, and how they compare with previous periods. We will have to make a call with our guts on the average prices. But if we put both together, maybe we can assign what type of market Lake Martin is in with a little more certainty than before. Thanks to Nicolai for the post, and for sending me his supporting data so that I could run a test on Lake Martin.
“So what?” – you ask.
Well, it means that if you are thinking about buying at Lake Martin – get hopping.
I think we’re in Phase V or VI, but I don’t know how long that will last. We blew through Phases III and IV pretty fast. And we only have up to go. With so many properties on the market, wouldn’t you like a professional to help you make sure you aren’t the one who gets burned? Call me or email me.
(*)Disclaimers: All of the above info was taken from the Lake Martin Area Association of Realtors Multiple Listing Service. Accuracy is not guaranteed but deemed reliable. The above does not include sales by FSBOs or developers that sell privately and not through the MLS. But, I do think that the above represents a very large majority of all sales on Lake Martin.