Market Overview

The Alabama Gulf Coast condo market remains firmly in buyer’s market territory through Q3 2024. With a continued increase in inventory and slower sales activity, buyers are finding themselves in a strong position to negotiate prices.

The absorption rate, which indicates how quickly properties sell, has risen significantly. The months of inventory have jumped from 10 months in Q3 2023 to 14 months in Q3 2024, signaling a continued oversupply of condos on the market.

While the average time on the market for sold condos has only slightly increased compared to Q2, the overall sales volume and demand have softened.

2024 Q2 & Q3 Waterfront Condo Market Insights

• Sales Performance: The total number of sold listings in Q3 2024 dropped to 144, marking a 39% decline compared to the same quarter last year. Despite the lower sales volume, the average sales price for Q3 2024 rose to $777,005, up from $749,748 in Q3 2023, reflecting the continued demand for premium waterfront locations.
• Inventory: The number of active listings continues to climb, reaching 710 by the end of Q3 2024, up from 588 during the same period last year. Additionally, 379 new listings entered the market this quarter, further expanding the available inventory. This increase in supply is driving the months of inventory up to 14 months from 10 months a year ago, contributing to the ongoing buyer’s market.
• Average Listing Prices: The current average listing price sits at $794,616, indicating a more balanced approach from sellers after a dip from the previous quarter. However, sales prices are trailing behind listing prices as buyers leverage the increased supply to negotiate lower offers.
• Days on Market: The average days on market for sold listings in Q3 2024 was 100 days, showing a slight increase from the 87-day average reported in Q2 of this year.

OBA & Gulf Shores Waterfront Condo Report Fall 2024

Key Factors Influencing Sales

Several economic factors are influencing the Gulf Coast condo market in Q3 2024:

• Interest Rates: It’s too early to tell how falling interest rates will impact the secondary home market. However, it should help with some buyers decision to purchase sooner rather than later.
• Reduced Rental Activity: The market for vacation rentals has shown signs of softening, which is impacting the buying decisions of investors. As rental income potential declines, some investors are holding off on purchases or negotiating lower prices.
• Buyer Caution: Ongoing concerns about the broader economy, including inflation and the upcoming 2024 elections, have made buyers more hesitant to commit to large purchases.

Fall 2024 Market Forecast

Looking ahead to the fall and winter months, we expect prices to stabilize, with sales prices continuing to trail behind listing prices. Inventory levels are expected to remain high, with more new listings entering the market, leading to further price negotiations. Buyers should continue to see favorable conditions, especially those looking for investment properties or second homes. Sellers will need to remain flexible on pricing and prepare for longer market times.

Selling or Buying a Condo?

Whether you’re selling or buying, it’s crucial to partner with a team that understands the complexities of the current market. Lake & Coast Real Estate Co. offers unmatched expertise in the Gulf Coast waterfront condo market. With our in-depth knowledge of the local area and a proven marketing strategy, we’re here to guide you every step of the way. Start your condo search or sale with the waterfront property experts at Lake & Coast.