Investors purchasing homes damaged by the August flood helped drive up November sales in the Baton Rouge area, with the latest figures from the Greater Baton Rouge Association of Realtors showing sales surged 38.9% during the month to 893, up from 643 during November 2015.
Pending sales also were up in November, rising from 600 in November last year to 894 last month—a 49% increase.
The sale of flooded properties, however, also dragged down the average sale price last month. Homes sold for an average of $192,831 last month, a 7.7% decline from the $208,884 average price during November last year.
“Folks are pricing their home for its current condition,” reads the GBRAR report. “It is possible the drop in median sales price will be greater in months to come as more flood damaged inventory moves through the market. That trend is likely to have a short life span followed by many investment homes coming back on the market after repairs are completed.”
GBRAR adds that many of the flooded and gutted homes sold in the Baton Rouge area were to cash investors.
Inventory remained tight in November, with the months supply figure—or the amount of time it would take to sell all of the homes on the market at the current sales pace—dropping 30.4% to 3.2 months. The number of homes on the market also fell from 3,714 to 2,959—a 20.3% decline.
In East Baton Rouge Parish, closed sales jumped 50.5%, from 329 in November 2015 to 495 last month.
“As in the area at large, it appears to be some investor activity spurring the increase,” GBRAR says, adding that pending sales were also up 41.6%, from 334 to 473, in East Baton Rouge.
New listings in East Baton Rouge climbed 19.4%, from 422 to 504, while the number of homes for sale strank 23.8%, from 2,054 to 1,566.
GBRAR says the ongoing inventory squeeze in Ascension Parish counteracted some of the flood effects on the market. Nonetheless, November sales increased 8.3% to 144 last month. In Livingston Parish, the hardest hit by the August flood, sales increased 49.2% to 191 in November. Pending sales, meanwhile, rose 72.7% to 190.
Along with East Baton Rouge, Ascension and Livingston parishes, GBRAR tracks housing data in West Baton Rouge, East Feliciana, West Feliciana, Iberville and Pointe Coupee parishes.