CONDO
MARKET REPORT FOR THE STACKS: OCTOBER 30TH, 2019 Courtesy of Matt and Sherry Wren at Harry Norman, REALTORS®
Snapshot of The Stacks Condo Sales The last 3 years of condo sales at The Stacks have been strong, with a steady number of annual sales and increasing values. The year 2019 is on pace to outperform the previous two in terms of both average sales prices for the 1-bedroom and 2-bedroom floor plans and for total number of sales. After a half-year of lower numbers of condo sales at The Stacks each quarter than the previous year, from October 2018 through March of 2019, decreasing interest rates helped drive the number of sales up again in the third quarter 2019 (Q3). In Q3, 2019, the number of condos sold at The Stacks was 38% above the five-year third quarter average. Sales in Q3, 2019 were 8% higher than in Q2, 2019 and 30% higher than Q3, 2018. Activity over the last 365 days ending October 30th, 2019 at The Stacks included 41 condos sold, 9 expired or withdrawn without selling, 3 under contract, and 13 currently for sale as of October 30th, 2019. Condos at The Stacks during this period sold at 3.4 per month, up from 2.8 per month for the same period the prior year. The number of condos for sale at The Stacks increased to 13 on October 30th, 2019, up 63 percent compared to a year earlier when 8 condos were for sale at The Stacks and more than double the number for sale on October 30th, 2017. This additional inventory pushed total months supply available within The Stacks to 4.7, an increase from 2.8 months supply available a year earlier. Condos at The Stacks that closed sales had an increasing average # of Days on Market: • 2017: 20 days • 2018: 21 days • 2019 YTD through 10/30/19: 28 days
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Low Interest Rates & Strong Supply-Demand Fundamentals Current mortgage interest rates nationally are relatively low compared with their levels over most weeks during the last 3 years, as you can see from this chart from Freddie Mac’s Primary Mortgage Market Survey®. Compared with the same time last year, interest rates on the 30year fixed rate mortgage have dropped over 1 percent, as is indicated in the survey, with rates going from 4.86 percent on October 25th 2018 to 3.75 percent as of October 24th 2019. (Source: www.freddiemac.com/pmms). Note that while the interest rates shown in the survey are not specifically for condo loans, which tend to have higher rates than single-family homes, they are considered reliable indicators of national mortgage rate trends in general. While interest rates increased recently from a 3-year low, they are still low by historic levels.
Generally, when months of supply is below 6 months, as it currently is for condos for sale at The Stacks, it is considered a Seller’s Market.
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As of October 30th 2019, there is a 4.7 months supply of condos available for sale at The Stacks and a 5.0 months supply of all condos available for sale located within zip code 30312, and priced from $0-$600,000. The residential real estate market that The Stacks condos are in is a Seller’s Market. Generally, when the months of supply is below 6 months, as it currently is for condos at The Stacks, it is considered a Seller’s Market.
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The purchasing power matrix indicates the impact of an increase or decrease in mortgage rates on a buyer’s monthly principal and interest payments on a $500,000 mortgage. All else equal, a 1% increase in mortgage rates would reduce the total loan amount a buyer can get by 10% while maintaining roughly the same amount of monthly principal and interest payments. The drop in interest rates from 4.86 back in October 25th, 2018 to 3.75% on October 30th, 2019 means more buyers can afford to buy a home today than if it were selling for the same price last year. For owner/sellers, this also means they can afford a home at a higher price when they sell their homes or condos and buy something else.
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Minor Seasonality in Monthly Sales Activity At The Stacks
The last five years of monthly sales data at The Stacks reveal some seasonality in sales, with the second quarter of the year (April-May) tending to be when the most closed sales occur. For the five-year period from October 2014 through September 2019, average closed sales per month was as follows: • • • •
3.0 in the 1st Quarter (January-March), 4.1 in the 2nd Quarter (April-June), 3.1 in the 3rd Quarter (July-September), and 3.3 in the 4th Quarter (October-December)
Over the past five years, condos that closed in the 4th Quarter of the year stayed on the market for an average of 32 days, which was the longest amount of time of any quarter. This compares to the five-year average of 28 days for Q1, 27 days for Q2 and 17 days for Q3. Note that the pace of condo sales during the most recent 365-day period ending October 30th, 2019 of 3.4 per month is about equal to the total average monthly pace of condo sales at The Stacks of 3.4 per month for the five-year period from October 2014 through September 2019.
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Most Recent Past Condo Sales at The Stacks (As of October 30th, 2019)
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Sales Activity for Last 3 Years In Zip Code 30312 for 1-Bedroom and 2-Bedroom Condos
The past three years shows that the number of condos sold in zip code 30312 fluctuated but did not show a steady trend during this period in either direction. During this period, the average prices of both 1-Bedroom and 2-Bedroom condos in 30312 increased.
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You may be considering a move this year. If so, you want a strong team that knows the market and can help you with every step.
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Sales Activity for Last 3 Years In Atlanta for 1-Bedrooom and 2-Bedroom Lofts Market activity during the previous three years shows a trend of decreasing numbers of loft style condos sold in Atlanta during this period. Meanwhile, the average sold price of both 1-Bedroom and 2-Bedroom loft style condos increased each year during this period. These trends both mirror the broader trend seen among all condos sold (any style) in Atlanta during this same time period.
Sales Activity for Last 3 Years In Atlanta for 1-Bedroom and 2-Bedroom Condos
Average Atlanta luxury market sales, representing the top 10% of all loft sales, increased in price to $557,425. This is a 6.6% yearover-year increase in price per square foot to $307.31. The average size of a luxury loft was 1,814 square feet, up 8% from the previous year, with an average of 2 bedrooms. One-bedroom lofts were the fastest selling subset for the 365 days ending October 30th, 2019, at a rate of 16 per month, followed by 2-bedroom lofts at a rate of 13 per month. As of October 30th, 2019, the total Months to Sell all available lofts actively for sale in Atlanta amounts to a 2.5 months supply for 1-bedroom lofts, a 3.3-months supply for 2-bedroom lofts, and a 5.1 months supply for 3-bedroom lofts. In summary, Atlanta is still in a Seller’s Market for loft condos. Despite decreases in total numbers of closed sales for lofts, sales prices have increased across the board.
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Conclusion Neither The Stacks condos nor all condos sold in zip code 30312 showed the same trends of decreasing number of sales during the past 3 years as the broader City of Atlanta did. In fact, The Stacks are currently on pace to outperform the previous two years in terms of both total number of sales and average sold prices of the condos. In our opinion, the draw that the recent extension of the Beltline Eastside Trail provides to the area around The Stacks is likely to continue to positively impact sales prices and demand at The Stacks.
The recently completed extension of the Beltline Eastside Trail is located just a few blocks walk from The Stacks, which is attracting millions of dollars in development and new dining options. These are either in planning, under construction or newly opened next to the Beltline. With all the momentum around the Beltline, the results seen in the past three years of robust sales at The Stacks and in zip code 30312 are not surprising. Based on the current months of supply indicating a seller’s market at The Stacks, as well as current low interest rates and increasing values, we consider the residential real estate market for buying or selling condos at The Stacks to be healthy. The condos at The Stacks show a higher likelihood of selling, based on current supply-demand conditions, than condos in the broader market. The likelihood of selling is defined as the number of closed sales during the last 365 days, divided by all those previously listed during the last 365 days ending October 30th, 2019. This includes closed sales, withdrawn or expired without selling, currently available for sale, or currently under contract, but not yet closed. See likelihood figures below: • • • •
62% for The Stacks 54% for all condos in zip code 30312, which are priced from $0-$600,000 56% for all lofts in Atlanta 56% for all condos in Atlanta, which are priced from $0-$600,000
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This likelihood of selling metric measures the challenges faced when putting any home or condo on the market when there is real competition from others on the market as well. Not all of the condos listed and entered into FMLS in any given year sell before expiring or being withdrawn. This is why having the right marketing plan, pricing strategy, and team of real estate advisors is so important. If you or someone you know are considering a move, we’d love to help! We will put our experience to work for you. Our Wren Atlanta team just sold a condo at The Stacks for well above the average 2-bedroom yearto-date price (through October 30th, 2019). Just give Matt or Sherry a call and let us be a resource to you.
WREN ATLANTA
Cell: 404-964-7080 (Sherry) Cell: 404-731-8300 ( Matt) Office: 404-261-2700 Sherry.Wren@HarryNorman.com Matt.Wren@HarryNorman.com
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Sherry and Matt are Real Estate gymnasts! They bend over backwards to make sure you get what you need!! The Wrens represented me in both the purchase of my new home and the sale of my last home. They got me a great deal on my new place and they got me a great price on my sale. If everyone had the same work ethic and energy level that these two do, the world would run a lot smoother! - Seller at The Stacks
JUST SOLD Condo E 421
WREN ATLANTA
Cell: 404-964-7080 (Sherry) Cell: 404-731-8300 ( Matt) Office: 404-261-2700 Sherry.Wren@HarryNorman.com Matt.Wren@HarryNorman.com
WREN ATLANTA TEAM COMMITS 5% OR MORE OF SHERRY’S & MATT’S PRE-TAX COMMISSIONS FOR EACH SALE TO LOCAL NON-PROFITS. EACH CLIENT CHOOSES FROM A LIST AT: wrenatlanta.com/commitment
wrenatlanta.com Buckhead/Northwest Office • 4401 Northside Parkway, Suite 250, Atlanta, GA 30327 • 404-261-2700 • Shea Zimmerman, Managing Broker • www.harrynorman.com The above information is believed accurate, but not warranted. Offer subject to errors, changes, prior sales and withdrawals without notice. Equal Housing Opportunity.