Blog : Loch Vista Club

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 Entry Level Lake Access Market Review

2017 Entry Level Lake Access Market Review

That’s a mouthful. I’m sure there’s a better way to say it for search engine optimization, but the market is best defined in that way.  The market isn’t particularly flashy. It won’t make any headlines. It won’t be in Crain’s or in Architectural Digest. But the entry level lake access market is the market that’s as important as any other here. These are the homes available to people who have enough fiscal power to make a vacation home a reality, but don’t have lakefront budgets.  For the purposes of this post, this segment remains at $500,000 and under.

All of these 2017 market reviews are going to tell similar stories. It’s all about inventory. About volume. And about how the inventory is either going to build and feed the market or shrivel and starve it. Today, there are just 12 homes priced under $500k with access to Geneva Lake. Remember, these are not municipal access homes- these are private, club style access points.  These are the associations you know, the associations that can offer a path to the lake, a park, a pier, a diving board, maybe some summertime geraniums in pots.

Those 12 homes vary wildly, just as this market varies. A $200k cottage in Country Club Estates is not at all like a $500k home in Country Club Estates. A small cottage in Oak Shores with a slip for $450k isn’t much dissimilar to a small cottage without a slip in Cedar Point Park, except that the Cedar Point cottage will be 50% cheaper. This is a market that I’ve gladly served for two decades, and it’s a market that hinges on a very important question: Do you want a nice house or do you want to be close to the lake?  You cannot choose both.

For the year just ended, we sold 61 lake access homes of all makes and models, priced under $500k.  The 2016 total was 56, so we’re heading in the right direction.  Just three of those homes had transferable boat slips, proving how hard it is to find a slip in this segment. Perhaps best of all, I personally sold all three of those homes. Why did I sell those homes? Well, because I know how valuable a boat slip is. I know owning a home here is wonderful, but if all you really want is to hang out on a pier and boat, then you’re going to be miserable in your off-water slip-less home, even if it has some stone counters and a master bathroom.

The key to understanding this segment comes back to that bold question about proximity. That drives this particular market more than anything. You can buy a nice house in Country Club Estates for $500k. It won’t be remarkably close to the lake. Or you could buy a small cottage in Knollwood for $500k that might be 900′ from the water. Which do you value? Do you want to walk down to the pier in the morning to cast your line a few times, motivated by the hope that something might bight? Or would you rather sit on your screened porch, reading a book thinking about where fish fry will be on Friday night? Answer those questions, and you’ll have a clear direction for your pursuit.

2018 should be just like 2017. Inventory is terrible now, yes, but it won’t be that way forever. This market might be more sensitive to the new tax law, but if inventory builds there’s nothing stopping 2018 from falling in the 2016/2017 volume range. Prices are increasing, albeit modestly. Value still exists here, and I’ll be here to help you find it.

Williams Bay Lake Access Market Review

Williams Bay Lake Access Market Review

When a buyer finds his way to Lake Geneva and begins to search for a suitable lake house, he tends to do lots of things wrong. He tends to see Glenwood Springs and think it’s just like Cedar Point Park, or he sees the Loch Vista Club and assumes it’s the same as Sybil Lane. Lake access is lake access, after all, and when you’re just up the road a ways from the lake it doesn’t matter what lane you’re walking. This is a mistake, but you can’t blame our home seeker for his folly. It’s not easy to understand this market, unless you’re just looking for some house on some street, then, by all means, wander away. Or worse yet, stop at an open house and work with that agent who shoved the sign into the snow bank.

The associations that surround this lake operate heavily on nuance, and it’s that nuance that confuses and distracts would-be buyers. Shouldn’t a house in Cedar Point be valued the same as a house in Country Club Estates? These two associations are, after all, the most similar of the large lake access associations, and so it makes sense that a home just up the street from the lake on Shabonna would be worth the same as one just up the street on Glenview.  Our buyer, with his obvious knowledge, wanders up Shabbona and finds a house for sale at $1.5MM, then he wanders up Glenview and finds one for $389k. Things are not adding up.

That’s because of the nuance, of the desirability of one place that might be somehow greater than the other place, even though at first blush the markets look the same. Shabbona homes don’t have boatslips just as Glenview homes lack them. But Shabbona has a harbor adjacent and Big Foot Country Club up the road, and all Glenview has is a beach nearby and Kishwauketoe trails.  That’s why the market behaves differently, because of those things that are not readily noticed. Today, I want to begin a few association specific 2016 market reviews to help better explain these nuanced differences. I won’t spend a day on each association, rather I’m going to dissect these associations into municipality groupings. First up, Williams Bay, because I’m from here and I’m sitting here now and it just seems appropriate to put my town first.

The lake access associatons in Williams Bay proper include only these few: Cedar Point Park, Summer Haven, Oakwood Estates, Loch Vista Club, and Dartmouth Woods. Because Dartmouth Woods is a lakefront association that finds membership in our lakefront segment, we’ll skip that for now. The lake access market, though made up of four associations, is dominated by one: Cedar Point Park. That’s because it’s huge, and it’s interesting, and it has the most diverse price points.  2016 provided sales as low as $142,800 and as high as $775k. The cheap sale was a remnant foreclosure, an REO that was an absolute mess of a house. I looked at it plenty, made an offer on it personally once, and decided that it was a house that was terminally hampered by the layout and overall design. The most expensive sale was on Oak Birch, and I liked that parkway cottage quite a bit. $775k for a cottage without a boatslip sounds like a lot of money, until you realize the setting was immensely special and the views comparable to any off-water view you could find.

In total, 16 homes sold in Cedar Point last year.  Three were over $750k, two of which were on a parkway. The parkways, as I should mention, are large grassy swaths that run from the lake and provide ample community lawn space for the association. If your home is located directly on a parkway, you’re in luck. It’s worth a lot of money, even for a home that doesn’t have a slip.  No homes in Cedar Point Park possess transferable boatlsips, in fact, no association home in any Williams Bay association can offer you a transferable boatslip. Keep that in mind.  Notable in Cedar Point last year was not the number of home sales, rather the low entry price of many of those sales. Nine of the 16 sales closed below $300k, proving that Cedar Point is a budget friendly option for anyone seeking a lake house in an old time association.

Nothing sold in Summer Haven last year, and nothing sold in Oakwood Estates. These two associations flank Pier 290 and Gage Marine, with Summer Haven to the North and Oakwood to the south. Both associations offer nice community piers, a private park, and some sparse parking. Summer Haven has a sand beach, making it one of very few associations on Geneva to lay claim to a sandy patch of frontage.  Of the two, Oakwood Estates is the more valuable, mostly because the lakeside aesthetic is superior and the separation from Gage Marine is greater.

The Loch Vista Club is where I grew up. It’s where I will always feel at home. It’s the pier I learned to swim from, the pier my kids learned to swim from, the place I know better than all of the others.  It’s a quality little association, with two piers and a diving board. There are no transferable slips, and the guy next up on the boatslip waiting list first scribbled his name onto it in the 1970s. If you want a slip, the Loch Vista Club isn’t for you. But if you want an idyllic lake experience, it’s a winner. Typical sales prices range from $300k and up, and in 2016 two off-water homes printed. One for $495k and one for $584k. These two sales are important, as they’re actually quite high for off-water homes possessing no view and no slip.

In total, 18 lake access homes sold in Williams Bay during 2016. Four other vacation homes sold last year with private frontage.  The take away is that if you’re a lake house buying in the Bay, don’t buy a home that doesn’t possess lake rights. That is, those special access rights that afford an owner unique membership to a private lakefront park and pier system.  During the prior market peak buyers would routinely buy off-water homes that lacked lake access and treat them as lake homes. They did this because the lake access prices were so high that the non-access homes seemed cheap in comparison. Today, the lake access homes are still affordable, and if you’re looking to make a solid investment in a lake house you’d do well to consider one of these four associations. The available inventory is sparse, but there is still value available.

Above, my son on the Loch Vista Club diving board at sunset.