Lake Travis, Austin, Texas' premier lake, has its own market conditions, says a local Realtor, and water frontage is different from other nearby areas.

Explains Realtor Ron Helle, "Lake Travis waterfront properties represent a very narrow spectrum of the overall Austin real estate market. Waterfront property typically represents the upper end of any real estate market, and provides the very best investment for the purchaser. Dollar for dollar, waterfront property will provide greater appreciation than any other category of real estate. Since they are not making any more lakes in this area, it is a function of supply and demand. As long as the demand exceeds the supply, values will increase."

• "Lake South: In 2004 there were a total of 47 residential waterfront sales, with a sales dollar volume of $36,455,480.00, and an average sales price of $775,648.51. In 2003 there were 40 residential sales, with a sales dollar volume of $30,357,520.00, and an average sales price of $758,938.00. This represents a 17.5 percent increase in the number of sales, a 20.09 percent increase in the sales dollar volume, and a 2.20 percent increase in the average sales price over 2003. In 2004 there were 9 sales in excess of one million dollars, ranging from $1,150,000.00-3,050,000.00, with a volume of $16,186,650.00. In 2003 there were 9 sales in excess of one million, ranging from $1,100,000.00-$2,275,000.00, with a volume of $14,643,250.00."

• "Lake North: In 2004 there were 52 residential waterfront sales, with a sales dollar volume of $24,039,593.00, and an average sales price of $462,299.86. In 2003 there were 38 residential sales, with a sales dollar volume of $18,952,550.00, and an average sales price of $498,751.31. This represents a 36.84 percent increase in the number of sales, a 26.84 percent increase in the sales dollar volume, and a 7.31 percent decrease in the average sales price. In 2004 there were only 2 sales in excess of one million, one for $1,545,000.00 and one for $2,295,000.00. In 2003 there were 3 sales over one million: $1,000,000.00, $1,450,000.00, and $1,765,000.00."

Waterfront lots:

"For our purposes, we are discussing waterfront lots for residential use as opposed to larger tracts intended for development," says Helle.

• "Lake South: In 2004, there were 46 waterfront lot sales with a sales dollar volume of $12,704,244.00, and an average sales price of $276,179.21. In 2003, there were 31 waterfront lot sales with a sales dollar volume of $6,490,000.00, and an average sales price of $209,354.83. This represents a 95.75 percent increase in sales dollar volume, a 31.92 percent increase in the average sales price, and a 48.39 percent increase in the number of sales.

• Lake North: In 2004, there 76 lot sales with a sales dollar volume of $13,600,750.00, and an average sales price of $178,957.23. In 2003 there were 48 lot sales with a sales dollar volume of $9,859,000.00, and an average sales price of $205,395.83. This represents a 58.33 percent increase in the number of sales, a 37.95 percent increase in sales dollar volume, but a 12.87 percent decrease in the average sales price compared to 2003.

Waterfront Residences

• South Shore: In April of 2005, there were 6 residential waterfront sales with a sales dollar volume of $4,264,200.00, an average sales price of $710,700.00, and a median sales price of $812,500.00. In April of 2004 there were 6 residential waterfront sales with a sales dollar volume of $6,447,500.00, an average sales price of $1,074,583.33, and a median sales price of $992,500.00. This represents no change in the number of sales, a 51.20 percent decrease in sales dollar volume, a 51.20 percent decrease in the average sales price, and 22.15 percent decrease in the median sales price."

Helle advises, "We must be careful in making the month-to-month comparisons and reading too much into them."

"In the period January-April of 2005 there were 14 waterfront residential sales," he continues, "with a sales dollar volume of $11,098,200.00, and an average sales price of $792,728.57. In the period of January-April of 2004 there were 15 waterfront residential sales, with a sales dollar volume of $12,255,500.00, with an average sales price of $817,033.33. This represents a 7.14 percent decrease in the number of sales, a 10.43 percent decrease in sales dollar volume, and a 3.06 percent decrease in the average sales price over the same period in 2004. Given the average sales price of $775,648.51 for all of 2004, the average sale price for the first quarter is only up by 2.02 percent compared to being up by 10.13 percent at the end of March.

• North Shore: In April of 2005 there were 3 residential waterfront sales with a sales dollar volume of $1,169,500.00, with an average sales price of $389,833.33. In April of 2004 there were 2 residential waterfront sales with a sales dollar volume of only $719,500.00, and an average sales price of $359,750.00. This represents a 100 percent increase in sales numbers, a 205.15 percent increase in sales dollar volume, and a 52.58 percent increase in the average sales price compared to April of 2004."

He says, "Again, let's get the perspective here."

In the period January-April of 2005 there were 12 residential waterfront sales, with a sales dollar volume of $5,968,200.00, and an average sales price of $497,350.00. In the period January-April of 2004 there were 6 residential waterfront sales with a sales dollar volume of $1,955,800.00, and an average sales price of $325,966.66. This represents a 100 percent increase in the number of sales, a 205.15 percent increase in the sales dollar volume, and a 52.58 percent increase in the average sales price over the same period in 2004. Given the average sales price of $462,299.86 for all of 2004, the averages sales price has dropped from an increase of 15.33 percent for the first quarter to only 7.58 percent by the end of April!

"Let's look at how they compare," he suggests. "In this four-month period, there were 16.67 percent more sales on the South Shore, with an 85.95 percent higher sales dollar volume, and a 59.39 percent higher average sales price for South Shore sales over the North Shore with only two fewer sales.

Waterfront Lots

South Shore: In April of 2005 there were 4 waterfront lot sales with a sales dollar volume of $634,000.00, an average sales price of $158,500.00, and a median sales price of $137,500.00. In April of 2004 there were 5 waterfront lot sales, with a sales dollar volume of $1,373,750.00, an average sales price of $274,750.00, and a median sales price of $250,000.00. This represents a 25 percent decrease in the number of sales, a 16.68 percent decrease in the sales dollar volume, a 73.34 percent decrease in the average sales price, and an 81.82 percent decrease in the median sales price compared to April of 2004."

He says, "Now, let's get the perspective."

"In the period January-April of 2005 there were 9 waterfront lot sales with a sales dollar volume of $1,554,000.00, and an average sales price of $172,666.66. In January-April of 2004 there were 10 waterfront lots with a sales dollar volume of $2,668,250.00, and an average sales price of $266,825.00. This represents an 11.11 percent decrease in the number of sales, a 71.70 percent decrease in sales dollar volume, and a 54.53 percent decrease in the average sales price compared to the same period in 2004."

• "North Shore: In April of 2005 there were 5 waterfront lot sales with a sales dollar volume of $1,208,000.00, an average sales price of $241,600.00, and a median sales price of $238,000.00. In April of 2004 there were 9 waterfront lot sales with a sales dollar volume of $1,315,500.00, an average sales price of $146,166.67, and a median sales price of $160,000.00. This represents an 80 percent decrease in the number of sales, an 8.90 percent decrease in the sales dollar volume, but a 65.29 percent increase in the average sales price, and a 48.75 percent increase in the median sales price."

"Let's add things up," he sums.

"In the period January-April of 2005 there were 12 waterfront lot sales, with a sales dollar volume of $2,119,300.00, and an average sales price of $176,608.33. In the period January-April of 2004 there were 17 waterfront lot sales, with a sales dollar volume of $2,712,250.00, and an average sales price of $159,544.11. This represents a 41.67 percent decrease in the number of sales, a 27.98 percent decrease in sales dollar volume, and a 10.69 percent decrease in the average sales price compared to the same period in 2004."

"Let's compare North and South, Helle enthuses. "This is interesting! There were 33.33 percent higher sales numbers on the North Shore, with a 36.38 percent higher sales dollar volume, and a 2.28 percent higher average sales price."

He analyzes, "Residential sales on the South Shore reflect the fact that values are higher closer to town. The lot sales are more complex. The South Shore lot sales represent 5 Pedernales River sales and 4 sales on Lake Travis that were all on coves. The fact is that the best lots are always the first to go, and my experience in showing lots recently is that there are very few prime lots available."

"The North Shore sales include one real dog lot, then 4 in Chimney Oaks, far out but newer and gated, two on Lohmans Ford (awesome views, but cliff access and road down the middle), and one each in Lookout Ridge (far out but panoramic views), Waterford, and Northshore (last two gated subdivisions)."

"Waterfront land is extremely hard to find. I think that one of the reasons that the numbers are down is that the inventory of prime lots is declining, causing the sales to appear weaker."

"For example, the three most expensive lot sales on the North Shore in the first quarter last year were in a new gated subdivision that was subsequently bought by a building company. They are no longer selling the lots individually because they want to build homes on them."

"Most lot owners appear to be holding on to them for future use (and possibly some investment potential I'm sure). You will typically spend in excess of $300,000.00 to obtain a "good" waterfront piece of property. The closer the land is in proximity to Austin, the higher the price will be, and the smaller the lot will be. In your higher dollar communities you will pay $600,000.00 and up when they are available."

He continues, "Residential waterfronts under, say $500,000.00, will typically be either a good house on a poor lot, or a poor house on a good lot. To get both you will have to spend more-sometimes considerably more. The values on the North Shore are obviously not on a par with the South Shore."

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Published: June 7, 2005

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