I’ve been writing 2017 on my checks with solid consistency for the better part of a month now. There are no more sixes that have been scratched into sevens. It’s 2017 and we know it, the shock of a new year has worn off. Spring is racing towards us, or it’s here, or it’s not, no one is sure. The year isn’t old enough to judge yet, but at seven weeks, the market is ready for a 2017 assessment.
The best way to judge an early year market is not by watching the closing data. Closings in January were sales from November or December. They are hold overs that pay testament to the prior year activity, and so they aren’t important. No matter, there haven’t been any 2017 lakefront closings to discuss. But there have been some new listings to review, and in those new listings there’s a bit of a story. The market can be measured by sales, measured by inventory, but also measured by the market reaction to new inventory. Let’s discuss that.
Last week a new lakefront in Cedar Point came to market in the $1.5MM range. A few days later, that lakefront property had sold. A magnificent sales job by the participating agents? A super rare piece of inventory that throngs of buyers had been anxiously awaiting? Not really, just an entry level lakefront that came to market cheap, and sold quickly. Every property has a price at which it will sell immediately, so there’s no secret to that particular sauce. But the sale proves the entry level market still has considerable legs even after the high volume year that was 2016. The quick listing and sale is a good sign for our market.
Two other lakefronts were brought to market this year, one being my listing in the South Shore Club that you’re looking at in the above photo. That’s a great house, but I haven’t sold it yet. It’s only been on market for three weeks, so by now it’s only fair to recognize that I didn’t price it as a fire sale. Another home in the South Shore Club that hasn’t sold for years came back to market as well, leaving two available homes in the club. Remember, these aren’t association homes priced as lakefronts. They’re $5MM lakefronts priced as $3MM association homes.
Another lakefront in Fontana hit the market at just under $6MM. That’s a nice lakefront home to be sure, and it’s only been on market for the past two weeks or so. Three new listings in total, one sold immediately, the other two for sale. No carry over sales from 2016 yet, although there are a couple that will be closing over the coming weeks as there are currently five lakefront homes pending sale (including new contracts on the Solar Lane lakefront and the harbor front home in Country Club Estates). So where does that leave us? Do we have the makings of a dynamic 2017 or are we seven weeks into a dud? The quick sale in Cedar Point tells us that buyers are ready and willing to pounce, but the two available at the higher ranges suggest buyers are still measured, still cautious, still paying attention. After all, this is the Midwest and we do measured very, very well.
The only thing we know so far is that the market is low on inventory, which is the same thing we knew at the end of December. Without new inventory, there’s no fuel for this fire. The stock market stability is wonderful for our real estate market, and interest rates remain low, albeit it at higher lows than last year. And there are buyers, plenty of buyers. All we need now is some more inventory, and I expect the market will find a way to provide that in the coming weeks. If you’re a buyer in search of something you haven’t yet found, let’s talk.