Blog : Lake Access

Shore Haven Sells

Shore Haven Sells

The lake access market at Lake Geneva is not difficult to understand. In order to find this understanding,  one simply needs to be open to the facts. In the instance of real estate, the facts are limited to sold comps. This is the only fact that exists in this business. Current value? Opinion. Future value? Opinion.  Sold listings? Fact. If you’re open to the facts, then you must embrace the sold comps.  If we’re looking at lake access markets, then the first comps to look at are inside of the association itself. If the immediate association cannot provide us those comps, then we’ll have to look at the broad market. In that there is an issue, because comparing associations? Opinion.

Last week, there were two lake access sales that caught my attention. One was important because I represented the buyer. The other was important because it just so happened to close for the same price, on the same side of the lake, during the same week. If there were ever two comps to be examined, these are those.  The sale that I closed was in Shore Haven, this of a home that I have sold in the past. In fact, I sold it just last year for $675k when that seller was in the process of upgrading to lakefront.  The home is nice, with some meaningful upgrades, a very desirable, large transferable boat slip, and terrific proximity to the water. This time around, I brought in the buyer, and the home was listed on a Friday and by Sunday we had it under contract. Did I enjoy negotiating only $5k off of a $720k list? No I did not. But the market, man. The market.

The other sale was in The Highlands, or the Lake Geneva Highlands, that association just to the East of Black Point.  The Highlands has been gentrifying quickly over the past decade, and more so over the past few years. It’s a nice enough association and one of the few remaining on the lakefront where a lakefront home can reasonably be expected to trade under $1.5MM. The home in the Highlands was a cottage style home with limited parking, a scattered tree lake view, and a transferable boat slip. It was updated, quite cute, and in that desirable location just one home from the lake. In this description, you can tell that the Highlands home was closer to the lake than the Shore Haven home, and the view was much better. The homes were both of average size, though Shore Haven had a garage and parking while the Highlands home was more challenged on this front.

That’s the background, and here is how the market works in each association. In the Highlands, there have been five MLS sales per MLS of off-water, non-lakefront homes that have closed over $470k and under $587,500. Per the MLS, the highest sale for a home not located on the lake or on the lakefront parkway, was $587,500. The fact that five homes have all sold in this tight window proves the primary market range for a Highlands home located off-water. The home that just sold closed for $715k, and now that it’s sold we can all agree that it was worth exactly what someone paid for it. But in the context of the market, that sale price set a new upper end in the Highlands.

Looking back to Shore Haven, we see in the MLS has printed 10 off-water sales priced over $500k. Of those, all but one was over $624k, with the most expensive sale being at $1MM, and five over $800k. The sale that I just closed for $715k, looks to fit right into the middle of the Shore Haven range, especially when considering proximity to the lake and size/location of the boat slip.  Was I deeply in love with $715k for this Shore Haven home? Not really. But did it make a load of market sense, particularly during this period of tight inventory and high buyer demand?  You bet it did.

Both sales were fine for our market, but now you have a slightly opened window into the way that I view these lake access associations. Every association is unique, every association is nuanced. Some are capable of printing high numbers that make little sense, and others are range bound, now and perhaps forever.  These two sales showcase the fall 2018 lake access market, and I think they both prove something important. Our market loves boat slips. It loves proximity. It loves a view. And sometimes it looks at historical sales patterns and determines they don’t matter very much.   To the buyer who just allowed me to represent his family in their Shore Haven purchase, a sincere thank you.

Lake Geneva YTD Performance

Lake Geneva YTD Performance

When you’re part of an industry that puts significant focus on calendar year performance, you tend to look up in late October and realize you’ve run out of time. In the same way, I have a theory that I gladly share with dinner guests and random acquaintances, but this theory has to do with life and not real estate. The two, no matter what your agent says, are not the same. My theory supposes that when a man, or a woman, is in their late 30s, they are no longer about to be something. They are no longer going to do something. They are no longer on their way to some different goal. In your late 30s, when you look in the mirror, you likely are what you are. Some people find this depressing. I find it oddly comforting. When the 2018 real estate market looked itself in the mirror this morning it wasn’t about to be something different. At this late date, 2018 is what it’s going to be.

But what has 2018 been, exactly? When the year began, I was worried. Worried about the stability of the stock market, worried about inventory, and slightly worried about interest rates. If the first two caused were gaping knife wounds of worry, the last one was a paper cut, and not one of those finger tip ones, either. If sellers wouldn’t sell into this market, then buyers would slowly lose patience, and they’d either jump ship and run with their tail between their legs to Michigan or some other terrible place, or they’d just hunker down in whatever it was that they already owned and wait for the inventory to arrive. At this point in 2018, the inventory did arrive, but it didn’t exactly satisfy the masses of buyers.

Still, inventory presented and then inventory sold. Some aged inventory sold as well, and it this late date in 2018 we’ve closed 20 lakefront homes with three more under contract as of this morning. The only three lakefront homes under contract (per MLS) are all my listings, which is nice. For context on that lakefront performance, consider YTD 2017 we had closed 24 lakefront homes. Does that mean the market has slipped? Of course not. It just means 2017 offered more inventory to choose from. The better context is to look back to 2012, the year that marked the low point in our recent cycle. YTD 2012 we had closed just 16 lakefront homes, and that had little to do with inventory and everything to do with worry.

The broad vacation home market, those homes with lake access with typical pricing between $200k and $1.7MM, has had itself a solid year as well. Inventory deficiencies plague this segment as well, but in spite of that concern we’ve managed to close 58 lake access homes in 2018. An additional 12 are under contract as of this morning per MLS.  The condo market is fairly similarly well, with 31 YTD sales of condominiums possessing lake access to Geneva. This is a vague measurement, as it includes some bits of inventory that I wouldn’t normally consider when adding up these totals (like dockominiums, etc), but it matters if we’re just assessing the overall volume performance of the segment. YTD 2017 printed 34 sales, and YTD 2012 had closed 30.  Keep in mind, this is including Abbey Springs and others, so it isn’t a pure measure of the lakefront condo market performance.

Speaking of that lakefront condo market, it’s moving quite nicely at the moment. There are two lakefront condominiums under contract as of this morning, leaving just 8 true lakefront condo units on market.  As we steam towards the end of 2018, expect to see some sellers following the move of my Bay Colony seller, as price reductions hope to tempt buyers towards a few pieces of overlooked inventory.  My Bay Colony listing, by the way, is now $799k, with a slip and likely the most high end interior space of any condominium on Geneva lake, excepting Stone Manor, of course.

Expect inventory to remain low through the end of the year, but don’t be surprised to see some new bits and pieces come to market over the next 30 days. Price reductions should increase over the coming two or three weeks, and the market will wind down by printing much of the remaining pending sales. 2018 has been a good  year, and looks to leave us staring at 2019 with an eye on the stock market, and the hope for new inventory.

Above, my Bay Colony offering. $799k for so much lakeside luxury. 

Black Point Sells

Black Point Sells

One of the many benefits of this strong vacation home market is that I get to test my theories on a daily basis. These theories were first penned when the market was in rough shape, which was just a few years ago in reality but so much farther away in the minds of 2018 buyers. The theory relating to the off-water lake access market over $1MM was simple. If lakefront homes were plentiful in the $1-2MM range, then off-water homes in same range would suffer. Why buy off water when the same price put you in the front row? In the same way, if $1-2MM lakefront homes were scarce, then off-water homes in the range would attract buyers. Lake Geneva real estate can be quite simple.

Simple as it may be, the theory was difficult for many off-water sellers to understand. During those dark years, most off-water homes that sought to capture a $1-1.5MM sales price ultimately languished on the market and fell victim to the price erosion that is a hallmark of lengthy market exposure. Most of those homes ended up selling, but rather than finding buyers in that $1MM+ range, most of these homes sold between $900k and $1MM. Buyers rejoiced, sellers wept.

Over time the entry level lakefront inventory dried up, leaving available only true cottages on small lots in modest settings. As that inventory shrunk, buyers turned their attention to the off-water homes that meant something. A slip, a view, a pool, some privacy. Maybe a combination of all of those. In the fall of 2016, I printed the sale in Loramoor for $1.625MM. Then another sale in Glenwood Springs for $1.1MM. Then, in 2017, a super high priced print with no slip in Oakwood Estates north of $1.2MM.  In 2017, another in Maytag Estates in the same range. Then a sale in Fontana north of $1.3MM. The market was moving, and buyers were once again looking for off-water properties simply because the on-water options were so scarce.

Last month, a new offering in this range. This one on Southland, or Black Point, as the tax records would show. $1.699MM for a few acres of wooded bliss, some terrain, a pool and a slip, a large home with pedigree, outbuildings and more. This was a property that the market rarely offers, mostly because it has no true rival. There are locations where off water homes will sell upwards and north of $2MM, but those associations are rare and historically light on inventory. The Lindens, Black Point, The 700 Club, Loramoor, Glen Fern. These are the rare associations, made that way by decades of low inventory and highly polished homes. These are the associations that matter to this segment, and this particular home was among the most rare inside even unique settings.

That’s why a buyer whom I was pleased to represent jumped. We closed on the house last week for full price, which is nothing to be ashamed of. In this context, full price was required, and full price was still less than the seller had paid for the home in the fall of 2011 when the market was in awful condition.  To further prove the strength of this off-water market, consider the home that would come to market just a few weeks ago in the 700 Club. That home hit the MLS at $1.495MM and promptly received multiple offers before finally settling at a contracted price that is rumored to be far over the ask. The market doesn’t always love off-water homes over $1.5MM, but if you give the market something unique in a highly desirable setting, the buyers will find it.

To this buyer who let me guide them through this curious segment of our vacation home market, I thank you. There’s an opportunity at this property to transform it into something without equal in our market, and I’m hopeful that the end reality matches your unique and exciting vision.

2017 Upper Bracket Lake Access Market Review

2017 Upper Bracket Lake Access Market Review

It’s well known and generally accepted that anyone with a lakefront budget will wish for lakefront. There were some people who lived up the road from my parents’ lakefront house in Williams Bay. Those people would tell me how they were glad they didn’t live on the lake. Too much noise from the boats, the waves, the sound of all that enjoyment. They preferred, they said, to live away from the lake, where it’s quiet. Where the lapping or crashing of the waves cannot find them. I remember that even as a young child I knew those people were lying. No one would prefer to be off the lake, and if a budget allows and the aim is true, then lakefront is the result. Or is it?

The upper end of our lake access market is unique in the flexibility such a budget might afford. A lakefront buyer with a budget up to $2MM might very well, and usually will, choose lakefront. But what will that lakefront be? Will it usually be nice? Will it be large? Will it afford privacy? Well, no, not usually.  The concept applies to those with lower lake home budgets as well. If you’re a $1.2MM buyer, I can typically find you lakefront. But will that lakefront be a beautiful house with two car garage and a pool? Of course it won’t. It’ll be a cottage, with some questionable structural supports and tight neighbors. But for $1.2MM an off-water buyer can find something quite unique. They can find a boatslip, maybe a view, maybe privacy, maybe a pool, maybe five bedrooms. This is why even when market segments overlap within the same price boundaries, many buyers will opt off water in order to gain something the on-water home cannot offer.

In 2017, the upper bracket lake access market experienced a strong influx of buyer traffic and closed the year with a significant volume total. 2017 closed 27 off-water homes priced over $500,000. That’s a huge number, but what’s most remarkable is the presence of liquidity in the $900k and above segment.  This lofty segment closed nine homes, including two in the $1.5MM range.  During 2016, the same segment closed 22 properties, with just five selling for more than $900k.

Thirteen of those 27 homes sold with transferable boat slips. Two of the sales were in our co-op communities, one in the Congress Club for $1.53MM and one in Belvedere Park for $564k. There were no public sales in the Harvard Club for 2017. Associations with volume in this segment included Geneva Oaks, Cedar Point Park, Country Club Estates, Indian Hills, Oakwood Estates, Black Point, The Lindens, Knollwood, The Loch Vista Club, Sybil Lane, Oak Shores, The Lake Geneva Club, Forest Rest, Maytag and Sylvan Trail Estates. That’s some widespread activity, and the market should be pleased for producing such strong volume.  Oddly,  there wasn’t a single residential MLS sale in this segment in Glenwood Springs last year.

Most of these sales made good sense to me. I was involved in six of these 27 sales, which means that at least six of the sales made perfect sense to me. Of the other sales, I was surprised at a few of them, including an off-water home with no slip that sold north of $1MM. Another shocker, at least to me, was the sale of a hilltop home in Fontana that closed over $1.5MM and was subsequently torn down.  That property lacked a slip, but the lake view is, as a point of fact, one of the best off-water views I’ve ever seen.

I was asked this week what I thought would be the better buy with a $1MM budget: an on-water cottage or an off-water home. I admitted I’d always look lakefront first, but I would consider a larger lot off-water, so long as I had a boat slip and was located in a high quality neighborhood (think Black Point, Lindens, Glen Fern, Loramoor, 700 Club). In those settings, I would happily consider off-water to be a near equal trade off. This segment today is light on inventory, as is the rest of the vacation home market. Just 16 off-water homes are available priced in excess of $500k. Of these available properties, my favorite is the modern home (my listing) on  South Lakeshore Drive that’s been reduced to $1.095MM. This is a lot of house in a rare location, and while it’s off-water it feels like a private lakefront home. It’s unique, but it’s a winner.

This particular segment is heavily influenced by overlapping lakefront inventory, which is, at the moment, similarly low in inventory. If entry level lakefront properties continue to be difficult to source, and the off-water market in the $900k-$1.8MM range provides some nice options, expect this market to benefit. If you’re a buyer in search of a lake house around the million dollar mark, I’m here to help.

Above, an idyllic cottage I sold this summer in the Lake Geneva Club.
2017 Abbey Springs Market Review

2017 Abbey Springs Market Review

I owe Abbey Springs something. Not money, I don’t think. It’s never paid me very much, so I shouldn’t feel obligated to pay it back. In the mid 1990s, I was a kid with a new, disastrous real estate career, and a desire to play tennis. I don’t know why I wanted to play tennis. I had never played when I was a kid.  We’d sneak down to hit a few balls at Conference Point Camp, on their cracked and heaved courts, but that wasn’t really playing tennis.  I couldn’t afford the Grand Geneva, with their shiny courts and wood lockers. So I played at Abbey Springs, under the tent they’d blow up over their outdoor courts in the winter. It was cold in there, dimly lit, and loud.  The inability to properly relay the score, on account of the noisy blower fan, suited me just fine. Thanks, Abbey Springs.

But that’s the end of the thanking. Abbey Springs the real estate market is really quite a spectacle. It’s a machine, finely tuned, running without a miss, or a knock, or a sputter. The market is perhaps the most unique and widely varied here, with vacation condominiums starting in the high $100s and single family homes reaching or exceeding a million bucks. Remember that sentence.

For the year just ended, Abbey Springs closed 28 built properties including condominiums and single family homes. For all of 2016,  there were 40 prints. Now, if I were were a headline writer for AP,  I’d right this in a way that would appear negative: SALES DROP 30% AMID MARKET TURMOIL. But I’m not AP, I’m just a kid from Williams Bay, and even I know that shrinking sales totals are natural and normal in a market with shrinking inventory.  We cannot sell what isn’t for sale. The sales total for 2017 is fine, the inventory today, at just 19 active properties (four of those under contract) is low. The market at Abbey Springs is in fantastic, healthy condition.

But that’s not really the whole story here, as much as Abbey Springs wishes it were. Consider the upper bracket sales from last year. There were four sales over $800k in Abbey Springs, with the highest sale reaching $885k. That’s nice.  For the last five years, the two top sales in the market registered the same amount: $885k. Nothing higher, and over those five years just five sales over $800k. Seems fine, right?

The prior market top was mid 2007 to mid 2008. We know this.  Abbey Springs, from 2005-2008 sold a lot of product, but where was the top end back then? For those years, Abbey Springs closed four sales over $900k, with the top sale at $1.3MM.  If the markets today are as strong as they were then, why can’t Abbey Springs push over $900k anymore? Where did the $1.3MM sales go?

There’s no particular mystery in this. The market is strong today, yes. But the top end has obviously been redefined, and that new definition falls short of $900k. There has been some inventory over $900k to press that theory, but those homes have failed to sell. The prior market peak found buyers in this range with relative ease. It’s apparent to me that this higher level buyer is still in the market, but has found his or her way outside of Abbey Springs and instead wants a traditional lake home experience. That buyer wants a slip. Maybe some privacy. A smaller association where the beach isn’t so crowded. The buyer who once purchased $950k homes in Abbey Springs has proven elusive in this current cycle.

But maybe that doesn’t really matter. Abbey Springs might not be a million dollar market anymore. Or perhaps there just haven’t been any million dollar homes listed for sale.  Either way, expect Abbey Springs to push forward yet again in 2018, and expect inventory to stay low. If you’re a buyer in search of a lake house experience with added country club style amenities, Abbey Springs is likely your best bet.  Condominiums from the $200k range and single family from $500k. Beach, pool, golf, clubhouse, and tennis courts, though the bubble is no more.

Oak Shores

Oak Shores

When thinking of lake access associations, it’s best to think first in terms of the obvious. Once the obvious is understood, then it’s time to progress to the nuance. With this process in mind, it’s in the nuance where the good and bad decisions should be made. The obvious, in the case of the Geneva lake access market, pertains to location. A good house a million miles away from the lake is not as good as a bad house right next to the lake. This is generally the understanding. But even this understanding has some departures, as a large lot far from the water can indeed be superior to a tiny lot near the water. Still, closer is generally accepted as being better.

In the same way, smaller associations are generally better than large ones. This aligns under the obvious. The reasoning here is that pier systems tend to be similar in size, and so sharing a pier with 25 neighbors is better than sharing it with 125 neighbors. You might love neighbors, but I usually don’t. And so smaller associations are better, and closer homes within those smaller associations are better. These things are simple to understand, even for people who prefer to vacation in Michigan.

Along the nuanced lines, there are things that many buyers fail to take into consideration. Proximity to the lake is wonderful, and meaningful, but in this is a steep walk downhill something that we’d like between our lake house and the water? If you prefer the steep walk downhill, I won’t necessarily disagree with you. But it’s the walk back uphill that I consider an offense.  If closer is better and smaller is better then surely level is equally as important.

And if we’re looking for close and level and small, then shouldn’t we focus our attention on associations that match up with these preferences? Sadly, there are few associations that meet these criteria that are affordable. That’s because these are the more desirable attributes, and desirability leads to pricing power, and pricing power leads to $9handles on lake access homes. That’s not attainable for many, which leads us to the doorstep of my newest listing. Oak Shores. $624,900.

This listing combines these rare lake access attributes, and does so in an easy to understand, easy to manage, easy to improve package. The house is three bedrooms and three baths. It’s around 1940 square feet. It has a two car garage. It’s been well maintained. Best of all, it’s 714 feet from the house to the lake. Those 714 feet are level, making the walk more a stroll, the stroll more a saunter. At the lake, there’s a fully transferable boatslip with plenty of water depth for ease of boat maneuvering. If you squint through some trees, there’s even a lake view. The association is small, the ground level, the only thing between you and the water is a small association road that feels more like a private driveway.

This is an easy house. It’s easy to buy and easy to own and easy to have fun with. The current seller has enjoyed it for decades, and it’s now time to pass the torch to another family who wishes to enjoy this lake in an entirely different way. If you’re a buyer and you understand that countertops can be changed but location is forever, then let’s chat.

Black Point Sells

Black Point Sells

The whole lake is special, we all know that. Every nook and cranny, whether our particular nook or our own favorite cranny, is unique and valuable. Some North Shore dwellers couldn’t fathom the horrors of living on the South Shore, and those South Shore owners would rather be dead than find their pier numbering 1-411. But there are universal bright spots, rare locations where the stretch is just right. The trees greener. The water bluer. One cascading landscape falling into the next, on and on, until the unique nature of it all turns to a different flavor, a different style, favored by someone else but not by everyone. These particular sections of the lake are sometimes obvious. Basswood. Snake. Creek. The lanes that offer up our best.

But the other areas, those are more nuanced. I once had a client who could have owned anything he wanted on this lake, and it was a difficult push to get him to move from his lakefront house in Glenwood Springs. He loved that house. That area. Those streets. The way the lawn runs uninterrupted for 1800 feet, give or take. He learned to love what he knew, and when the chance to move on presented itself, bold and immediate, he paused. Because Glenwood Springs was where he felt most at home.

This week, I closed on a hilltop house on Black Point. Black Point is just to the East of  Majestic Ski Hill. It’s dark and it’s intimidating and it’s high. The Black Point Mansion once anchored the entire point, but is now relegated to the land on the West side of the point, and everything else has been developed into large lakefront and lake access parcels. The homes there are varied, but mostly vastly improved and manicured. Two years ago, a 1980s cedar house came to market for $1.395MM. It was a nice enough house positioned in a most incredible way on the top of the bluff that runs from deep under the water and up to this very tippity top. The house is surrounded by towering pines, the sort that create a most audible white noise whenever the wind rustles. Under the summer sun, the sweet aroma of pine sap is unavoidable and welcomed.

The problem here was that the house just wasn’t nice enough to command that price. It was a nice house, sure, and the location was incredibly desirable, but the house lacked the sizzle that the market responds to. There’s a house in Lake Geneva that just came to market around $1.3MM, and that house looks as though it’ll sell quickly. The location is okay, not super unique, but quality. The house, however, has the interior sizzle that buyers clumsily rush towards.  Fancy finished in this market always attract buyers, whether that’s a lakefront home, an off water home, or a primary home without any lake access at all.

And so the house on Black Point sat. It caught the attention of a dear client of mine, but our lower priced interest was rebuffed by the seller. We watched it some more, enamored with those pine trees and that deep water slip. It should be noted that “deep water” is a way we describe slips, often. But in the context of Black Point the deep water is different. It’s really deep. Like immediately deep. Dropped your sunglasses off the end of the pier? A fish with large teeth, irridescent skin and a light dangling off its head in front of its eyes just ate your RayBans.  The house, no matter that location and that slip and those two acres of pine trees, didn’t sell.

Over time, the price was adjusted. Lower a bit here and lower a bit there.  This spring, after the property was growing a bit weary, we bid again. That deal was negotiated to an end, and the cedar house on the top of Black Point sold this week for $950k. My client is pleased and excited, as am I.  This is a special location, a prized location. There are others on the lake, some more special and more unique than the others, but this location, man. This location. Congratulations to the new owners.

Loramoor Opportunity

Loramoor Opportunity

On Monday, I said goodbye to an old friend. I met this friend when I was ten, maybe twelve, sometime around then. This friend was with me through it all, through the good times and through the bad.  We ate together, we laughed together, we chewed steak together.  Alas, this relationship wasn’t meant to last, and on Monday it ended.  It was one of my very favorite teeth, one way in the back, one that I used often. There was no tooth better. But on Monday it was unceremoniously yanked from the back of my mouth and I barely had time to say goodbye. That’s why I didn’t write on Monday.

But today is Wednesday and I’m over that weak tooth. Today is about Loramoor, and about decisions, both good and bad. Like all that candy I ate when I was a kid, and the dentist who decided to drill out every last bit of that poor, deceased tooth.  Today is about the decision to buy a tear down and build yourself a brand spanking new lake house. What a wonderful thing, this new house. It’ll be large enough and fancy enough; it’ll be perfect. You’re not one to live in someone else’s house, you’re the sort that wants your own house, with your own stamp of style and taste. I cannot blame you, as I, too, have built new homes and enjoy nearly everything about living in a new house.

Over recent years, this building boom has touched every bit of our vacation home market. The tear downs that make the most sense are on the lakefront, of course, where properties can be bought with regularity for land value. New construction on the lake makes sense most of the time, but for every two tear downs that make sense there is one that doesn’t. Tear down a house on 100′ of frontage and build new for $2MM or so? Usually a great idea, depending on the location of those 100 feet.  Pay $1.5MM for a house on 50′ of frontage and tear that down? Not usually all that smart. Off water, the same sorts of mistakes are made. Buy a cottage in Knollwood up the road from the lake for $300k and tear it down? Terrible idea, unless you’re looking to stay put for most of eternity.

But the segment that is most interesting when it relates to tear downs is the mid-market of lake access homes with boat slips. It’s not uncommon for a buyer to pay $400-600k for a house in a neighborhood like the Lake Geneva Club, or Hunt Club Lane, or Glenwood Springs, and then tear the house down. In fact, it happens with some frequency. A home on Hunt Club Lane sold in 2013 for $659k. It was a unique house, odd really, with an acre and a half of land and a boat slip.  The lot was not especially close to the lake. That buyer tore the house down and built new, effectively paying $659k plus demolition cost for a vacant lot.

This is one example of a phenomenon that occurs all over this lake, and it’s occurring more and more now that the market is high on buyers and low on inventory. Even the homes that aren’t entirely razed are generally the recipient of some form of major renovation. That’s why the new listing I have in Loramoor makes complete and utter sense. My newest listing is a level vacant lot measuring just under one acre in size, with a transferable boat slip in East Loramoor, a slight lake view, and a location on Loramoor’s dead end lane.  As opposed to the Hunt Club property that was far from the water, this lot is one off the lake (see map above). The asking price is $750k, no demolition required.

On the lakefront in Loramoor, I sold a beautiful lot last fall for $2.075MM. That lot will host an incredible new home this summer. Three doors to the West of my new listing is the old Loramoor stable house. This house was in poor condition for years until an enterprising buyer purchased it and fixed it up. That home is now for sale in the mid $1MMs.  I sold the house at W3036 South Lakeshore last fall for $1.625MM, that with a slip in Loramoor, three acres and a pool. The market context for this Loramoor listing is complete and it’s thorough and it proves that high valuations can and do exist here.

You could purchase a home in Shore Haven for $500k and tear it down. You could. People have. But what you’d be doing is building new in a neighborhood that has a cap of around $850k.  The same is true for the Hunt Club example. It’s rare to have a lake access neighborhood support built value to the mid and upper $1s, but that’s exactly what Loramoor offers. Consider this lot. Consider a new home, built near the water with a slip and a swimming pool and a most exclusive address.  It makes solid market sense, and it’s available today.

Temptation

Temptation

As I understand it, Door County is a place where you go because you want to eat cherries while spending the better part of a full day searching for a place that will serve you a proper espresso.  Door County is also a place where lake access doesn’t mean the same thing that it means here. That’s because the lake isn’t really a lake at all, rather it’s an inland ocean, which is beautiful to look at but also mostly unusable for the typical weekend warrior. The lake is different, the market is different, the cherries are good, the espresso absent. This is all you need to know about Door County.  You’re welcome.

The market here is very unique, as lake access or lake rights really means something. For years I’ve heard sellers explain to me the reasons that lake rights don’t matter. Coincidentally, the only sellers that undertake this attempted explanation are those that own homes that lack the attribute. They’ll opine how lake access isn’t important because of beaches, and because of launches, and because of parks and restaurants. They’ll work to convince me that they’re right, all the while we both know they’re wrong.

That’s because no amount of dialogue, no matter how impassioned, can change generations of market behavior. The market expects lake access, it wants lake access, and when someone emails me this week and wants to buy a vacation home at Lake Geneva, they’re probably going to ask me about lake access. Once they ask me, I’m going to tell them that they need it. In doing so, I’m furthering the generational standard, leaving very little room for wavering. If you’re looking Lake Geneva, you should be looking lake access.

When the market was hot, buyers moved away from this standard. They’d buy homes on Anystreet, Williams Bay, because of the beach and the launch and the restaurants. They’d buy a home on Oakwood Street because it’s a nice enough street, and they could pay $180k for a house that would have cost $319k in Cedar Point Park. I understand the economics of a non-lake access purchase, I really do, which is why there should be a discount paid for homes that are in otherwise boring locations that lack lake access. If you’re contemplating a vacation home purchase here, your vacation home should be surrounded by other vacation homes. It’s really that simple.

Now that the market is warmer again, buyers are returning to their old discount-seeking ways. The house in Cedar Point is $289k now, and the house on Oakwood is still $180k, so Oakwood wins. If that’s all your budget will allow, I completely and entirely understand the reason you’d entertain Oakwood. I honestly do. But if the budget allows for the $289k, please go that route. Not because I want your Realtor, who should actually be me, to make more money, but because I want your future appreciation tied to the vacation home market, not to the primary market.

There are exceptions to this rule of mine. Unique homes in special locations, those get a pass. Unique lots- oversized or featuring some sort of special view- I’ll let those slide as well. But if we’re buying a normal house on a normal in-town street, let’s first exhaust our lake access options.  Because once you buy that non-lake access house in town you’re pretty much going to spend every day from then on wishing you had a private association pier to hang out at. And if you’re not going to have a private association pier to hang out at, you might as well keep driving for another day and end up in Door County. It’s BYOEspresso, just so you know.

 

PS. I was at the Cub game last night, which means it is likely my fault that they lost.