Waterfront homes are a part of what makes Lake Norman so popular. What an amazing lifestyle they offer! Yet, during most of 2016 I once again noted, well complained, in my monthly Lake Norman market reports about our mercurial sales in luxury homes, the lack of inventory of good waterfront homes in the under $1 million price ranges and the historically low number of sales of waterfront homes as a percentage of our overall Lake Norman real estate market. So, what is up with waterfront homes? Now that 2016 is in the books I have put our 2016 waterfront home sales numbers in context with the past 11 years. The results are really fascinating if you like numbers! Let’s take a closer look:
Lake Norman Waterfront Homes Sales 2005 – 2016
*All date is compiled using the Charlotte Multiple Listing Service
A closer look by vertical columns of this chart:
- Number of sales: Looking solely at the volume of waterfront home sales, 2016 logged in the highest number of sales for the past 12 years by a rather impressive amount! So, despite my complaining throughout the year, if we look at the big picture 2016 was a stellar year for waterfront homes.
- Average price of waterfront homes per year: The average price of a waterfront home increased from 2015, matched our 2014 numbers but is still well below 2006-2009. This is critical to understand because while the number of sales broke records Lake Norman’s waterfront home prices still haven’t fully recovered from the recession. (It is our luxury price ranges that are still struggling.)
- Median price of waterfront homes per year: Remembering that a median price means that half of our 2016 sales were above $711,500 and half were below, in 2016 this number increased as well and is the highest since the recession but also remains lower than 2007-2009.
- Price-per-square-foot per year: The price per square foot of waterfront homes in 2016 increased again but has yet to rise back up to our 2006-2008 highs. I sound like a broker record but these numbers are all telling the same story.
- Average Days on the market: And, the time it takes to sell a waterfront home has been steadily decreasing since the recession but still is nearly twice as long as our fastest year 2006.
- Percent the sales price was to the listing price: This is the one number that has not varied that dramatically over the past 12 years. Waterfront homes have been selling about 4% below their last listing price for the past two years. Remember to keep in mind that there may have been price reductions before they sold.
Just to be clear:
Average = the sum total of the numbers being analyzed divided by the number of homes. And the median is the number smack dab in the middle of the properties being tallied.
Here is an example:
- Waterfront homes sold in the past week:
If we add these up the total $ sales are: $3,600,000 divided by 5 = an average sales price of $720,000. The median price would be the number right in the middle or $750,000. These are actually pretty close but let’s change the #5 price to $2,500,000. Suddenly the total $ volume jumps to $5,000,000 and the average price of these 5 sales jumps to $1,000,000 while the median price remains $750,000. Average prices clearly can be an inaccurate insight into our market. With only one home selling for over $1 million but the average is $1 million the numbers are skewed.
Now let’s take a closer look by city/town:
Now these numbers truly provide great insight into what is happening in our 7 towns on Lake Norman and show quite a variety of trends among them.
Mooresville: I ranked the towns by sales volume and clearly Mooresville had more than double the sales of any other town on the lake which isn’t surprising since Mooresville has by far the most waterfront shoreline. Overall Mooresville’s prices were slightly higher than the average, median and $ per- square-foot overall prices for the entire lake. They also had the second lowest Days On Market.
Denver: Coming in second for sheer number of waterfront homes sold, Denver’s statistics tell a very different story. Their average, median and $ per-square-foot numbers were well below the average. While Denver does have some very high-end luxury homes, their overall sales have been in the lower price ranges.
Cornelius: Cornelius does not have nearly as many miles of waterfront shoreline but what they lack in volume is made up by their prices. Their average sales price was a whopping 61% higher than the average for all of Lake Norman and their $ per-square-foot was 22% higher than the average. On the flip side, the average number of days it took to sell was the highest of all 7 towns and significantly longer than the average for all of Lake Norman. Finally, they had the lowest % sale-to- list price. I attribute this to the fact that when you are dealing with luxury waterfront homes they simply take longer to sell. Keep in mind that Cornelius is much closer to Charlotte than most of the towns so is popular with those wanting to be closer to “the action”.
Sherrills Ford: The northern towns along Lake Norman have been the slowest to recover since the recession which is clearly evident in the numbers above for Sherrills Ford, Troutman and Statesville. Sherrills Ford’s prices were well below the averages for the entire lake and were the second lowest town of the 7. Waterfront homes also took slightly longer to sell. Keep in mind that there are not as many waterfront homes, especially luxury waterfront homes, in Sherrills Ford. With the huge new shopping center and Publix under construction I expect long term to see more growth in this area as well as northern Denver.
Troutman: Still struggling, I was most disappointed in Troutman’s numbers. Before the recession they were the HOT location for the newest construction. But they have really struggled to recover. I attribute this to a number of factors including the distance to shopping and amenities but also the increasing traffic on Hwy 150. This is a trend to watch in the coming years as traffic increases everywhere. Long term plans for widening Hwy 150 should have a significant impact but until then I expect Troutman to continue to struggle. This represents an opportunity for those seeking a lower priced home on the lake.
Statesville: Located at the northern most section of the east side of Lake Norman, Statesville is still considered fairly remote for most waterfront home buyers. They only had 9 waterfront home sales in all of 2016 and posted the lowest prices of all 7 towns. The shoreline in Statesville tends to be more wooded and hilly. Adjacent to the 1300 acre Lake Norman State Park, it is idyllic for those wanting a nature retreat close to hiking and mountain biking trails.
Huntersville: I hesitated to even include Huntersville because is has only a couple of waterfront communities but their numbers are interesting. Their 3 sales had the second highest prices of the 7 towns but took a bit longer to sell and sold 5% below the listing price on average.
- Overall, our sales volume of waterfront homes in 2016 was the highest since 2005 and the value of our Lake Norman waterfront properties is also the highest since their bottom in 2011.
- Distressed properties are all but gone.
- Lake Norman waterfront homes are about 15% less expensive than at their peak year 2008.
- Lake Norman waterfront homes are selling faster and for more money than any other year post recession.
- There is quite a difference in waterfront home sales prices, inventories and trends in the 7 towns sharing Lake Norman’s shoreline. Use the second chart above to help you determine which towns will best suit your goals.
Because there is a finite supply of shoreline there is also a finite number of Lake Norman’s waterfront homes and lots. Until the recession hit Lake Norman waterfront home prices were appreciating at a much faster pace than off-water homes. (And, they dropped at a much larger percentage). I believe that this finite supply and consistent demand will continue to drive Lake Norman’s waterfront prices up in the years to come. Lake Norman home buyers who are looking at long-term appreciation and can afford a waterfront home should seriously consider waterfront over off water. The most important considerations as always are location, quality of the water and shoreline, and the topography of the lot.
I leave you with this final thought: