Coronavirus Impacts Lake
First quarter sales volume and closed transaction reports look good on the surface but a deeper review reveals the harsh impact Covid 19 has had on the Spring lake area real estate market. First quarter closings of lakefront homes increased 12.9 percent compared to 2019 and increased 25.8 percent in sales volume and 11.4 percent increase in average sales price. New listings were down by 8.4 percent and days on the market decreased 9.3 percent.
A closer look at these numbers along with compiling additional reports from April data shows a considerable decrease in 2020 year to date lakefront home sales.
The year started strong and transactions increased in each of the first three months but you will see that each month that increase lessened. We were on track to have a record Spring market.
January 2020 showed an increase in sales compared to January 2019. Closed transactions increased 28.6 percent, total dollar volume increased 62.3 percent and the average sales price increased 25.25 percent. New listings decreased 14.6 percent and days on the market averaged 5 percent less than in 2019.
February 2020 Closed transactions increased 12.9 percent, total dollar volume increased 22.9 percent and the average sales price increased 8.9 percent. New listings increased 20.8 percent and days on the market averaged 16.7 percent more than in 2019.
March 2020 closed transactions increased 3.4 percent, total dollar volume increased 8.8 percent and the average sales price increased 5.2 percent. New listings decreased 23.7 percent and days on the market averaged 30 percent less than in 2019.
Beginning mid-March we began to see several buyers and sellers cancel pending transactions. This continued to occur over the last half of March and into the first week of April. Most of these deals would have been scheduled to close in April and the first half of May. Many of the homes that had buyer cancellation are already under contract again; but it created a considerable gap in closed sales. The large decrease in new listings has also suppressed sales.
Breaking down the sales data into weekly increments beginning mid-March really shows when the effects of Covid-19 and the protective measures start to kick in.
March 15-21, 2020 vs. 2019: 21 percent increase in closed transactions, 66 percent increase in average sales price and 101 percent increase in closed sales volume.
March 22-28, 2020 vs. 2019: 25 percent increase in closed transactions, 2 percent increase in average sales price and 27.6 percent increase in closed sales volume.
March 29-April 4, 2020 vs. 2019: 18 percent increase in closed transactions, 23 percent decrease in average sales price and 8.7 percent decrease in closed sales volume.
April 5-11, 2020 vs. 2019: 11 percent increase in closed transactions, 15 percent increase in average sales price and 28.5 percent increase in sales volume.
April 12-18, 2020 vs. 2019: 42 percent decrease in closed transactions, 35.6 percent decrease in average sales price and 62.7 percent decrease in closed sales volume.
April 19-26, 2020 vs. 2019: 71 percent decrease in closed transactions, 5.9 percent decrease in average sales price and 72.2 percent decrease in closed sales volume.
April 2020 vs. 2019 shows that closed transactions decreased 35.2 percent, total dollar volume decreased 45.79 percent and the average sales price decreased 16.3 percent. New listings decreased 55.9 percent and days on the market averaged 24.6 percent less than in 2019.
The year to date 2020 vs. 2019 lakefront homes sales as of April 27th show a decrease of 4.6 percent in closed transactions, 3.8 percent decrease in total sales volume and the average sales price is changed less than 1 percent. Average days on the market has shortened by almost 16 percent and new listings decreased 23.3 percent.
Buyer activity and interest is extremely strong. I am also seeing an uptick in the luxury and half a million an up market. In the past seven days, I have successfully negotiated contracts on two $1 million plus homes and two $500,000 plus homes. I am currently negotiating on a $950,000 home. Calls and information requests are up, and I feel optimistic that the market is already correcting itself and will come back even stronger as restrictions are lifted.
There are currently 338 lakefront homes on the market. 132 homes are priced at $500,000 and up, 119 are in the $250k to $500k range and 87 are priced under $250k. An additional 92 lakefront homes are under contract. 24 homes are price at $500k and up, 41 are in the 250k to $500k range and 27 are priced under $250k.
I’ve concentrated on lakefront home sales because they tend to show the clearest picture of what is going on with the second home market but sales across all property types have followed closely.
A brief synopsis of condo sales shows the same patterns. April 2020 Closed transactions were down 46 percent vs. 2019 and YTD had decreased by 28.9 percent. Total sales volume for April decreased 43.1 percent but just 3.4 percent YTD. April 2020 vs. 2019 average sales price increased 5.19 percent month over month and 5.76 percent YTD. Days on the market decreased 6.8 percent in April 2020 vs. 2019 and YTD the days on the market decreased 14.23 percent. There are currently 249 active condo listings and 83 condo listings under contract.
Second homeowners have migrated to the lake in droves during the stay at home orders. Many families are getting to experience a new time at the lake when work and extracurricular activities normally prevent them from spending much time in their happy place. I have seen an abundance of traffic at subdivisions and condo projects all over the lake area with some development’s parking as full as I usually see in July. When the sun shines and we are blessed with warm weather, the lake looks like a summer weekend on a weekday in April. I think the Covid-19 outbreak will increase interest in vacation homes in more secluded area. Families will be reassessing values and time spent together and seeking out places that they can enjoy in case of future shelter orders where they feel safer and more removed.
I know I am biased having grown up at Lake of the Ozarks, but I feel we have the best community to shelter in during any life event. The kindness and support I have seen from the residents (full and part time) is unsurpassed. Business owners have quickly adapted in order to protect employees and customers, restaurants switched to curb and dockside services to keep paychecks going to their employees. Volunteers at food banks across the lake have continued to show up and help keep food on the tables of so many in need of assistance.
We took a pretty good hit in April especially if you factor in the upward trajectory in sales that were trending the first three months of 2020. This was driven in part by cancelled sales due to the unknown personal and financial impact of the coming months. It was also driven by an already limited inventory seeing new listings reduced by more than 50 percent. Unless we have major setbacks in the next few months, I predict that the upward trend will reappear and be confirmed by May and June sales stats. One unknown factor is what the impact will be on current owners who had intended to sell in the Spring of 2020. I know some are now reconsidering keeping their lake home as a retreat. Inventory is going to continue to be a huge factor at Lake of the Ozarks.
C. Michael Elliott and Associates is a privately owned, boutique office with a great group of knowledgeable, topnotch agents and staff that will work in your best interest. There are some great real estate agents at the Lake, but you won’t find any better than the agents I work with daily. Please give us a call if you are considering buying or selling. We’ll explain our services in detail and you can decide if we are a good fit for you.
Michael Elliott has been selling real estate at the Lake of the Ozarks since 1981. He is one of the most respected brokers in the area. Feel free to contact him if you would like to work with him, have a real estate question or have interest in a career in real estate. 573.365.SOLD or email@example.com or stop by C. Michael Elliott & Associates, 3738 Osage Beach Parkway. Sales data obtained from the Lake of the Ozarks MLS for 2019 and 2020.