Lake Geneva Market Update

I think it would be fun to write about baseball. Not baseball the game, but baseball the season, the team. To be a beat writer is to be faced with constant deadlines, but there is a new game to write about almost every day, so I don’t think content procurement is all that difficult. One game, your star right fielder will get hurt. You get to write about that. One day, your star left fielder will have the flu, and he’ll still get up to bat and then he’ll make important contact and drive in a run. You can email his high school coach to see if he ever played sick before. If he did, you can write about that and declare him a trooper, a selfless player, a stand up guy. Writing about all of that would be easy, because there is new content being created on the field every day and all you have to do is report what you see.

In real estate writing, there is new content every day, sure. But it’s mostly boring content. Someone bought this house. Big deal. Someone is selling that house. Yawn. Some Realtor just got a new car and another one took a new photo. Who cares? Collectively, these stories might add up to one measly 600 word post, but individually they require even more filler words that I’d normally use, just to make the post passable. That’s why I wait for some news to accumulate before pushing it out for the world to digest. Today, a compilation of events, and thankfully, none of them have to do with any new cars or new glamor shots.

The lake access and lakefront market on Geneva has grown quite interesting of late. There’s a general feeling of urgency, which is common in spring when colors start to reappear, and the lake turns from ice to water. That happened last Sunday, by the way, and that’s a date that I called nearly two weeks before. I called it on twitter, so if you’re on Facebook, where I’m not, then you missed the incredible clairvoyance of my prophecy. The lake is open, the grass is greening, the rains from last weekend permeating the soil that now needs only to be warmed to send up flowers and leaves and all sorts of cholophormy bits. Spring is upon us, and the market knows it. People are in a hurry, as they should be.

This urgency is widespread, and showings around the lake appear to be up in every single segment. Lakefront condominiums are active, lake access homes are, too. Lakefronts are always active, it seems. The lake access market has ample inventory, priced from $150k to $900k. There’s plenty of it to be had, so if you want a basic cottage for $225k or a nice home with a slip for $750k, we can fulfill whatever your present desire. The lakefront market is behaving a bit oddly, at least in terms of inventory. We’ve built masses of high end inventory, those homes priced over $4.5MM. There are eight homes priced over $4.5MM, and I hesitated before labeling them all homes, and not estates. What’s an estate? Well, it’s 2+ acres, it’s 150+ feet of frontage, and by that metric there are only three true estates available on Geneva. I’m bringing two more such properties to market in the coming days and weeks, and those will be true estates. Remember, calling a property an estate in an advertising description doesn’t make it so.

The entry level market on Geneva is starving for inventory. The only new entry level property to come to market this year is a small house in the Birches, and that is already under contract with an asking price of $1.499MM. Aside from that home, and removing a South Shore Club offering at $1.749MM, the cheapest lakefront is in Glenwood Springs, and we all know that Glenwood Springs is only lakefront inside of the market context, and not in actuality. The “cheapest” true lakefront home is listed at $1.875MM, and that’s next to a hotel, so you can imagine how impressed I am with that location. There was another time when the most economical lakefront home was priced around $1.9MM, and that was 2007.

We could use some quality lakefront inventory in the $2MM to $3.4MM range, as that’s the undeniable sweet spot for our lakefront market. My large listing on Loramoor priced at $3.195MM is under contract as of last week, so that makes me happy. Also pending is the large property on Southland for $2.475MM, also to a buyer of mine, so I’m still happy. There are offers circulating in the South Shore Club, and likely an offer or three circulating on the lakefront that I’m not involved in. That, it should be noted, makes me sad in a brooding, selfish way.

I’ve written loads of offers over recent weeks, and there’s a new theme in the market that I’m not thoroughly pleased with. Sellers are holding tighter to their list prices than they have at any point since the spring of 2009. Of the seven or eight offers I’ve written of late, only two have come together. If this were 2011, I would have likely put all of these written offers under contract, as sellers used to view buyers as treasured possessions, and now they view them as a rather un-rare commodity. This, of course, will come back to bite many over-confident sellers, as a buyer today does not guarantee a buyer tomorrow. I’m hearing reports of seller confidence increasing because of increased showings. I’d argue that increased showings and a lack of corresponding offers is actually a negative for any given property, making a singular written offer all that more valuable.

If you’re a buyer, expect two things. First, get ready for fresh sellers to be somewhat smug. They don’t want to negotiate like they used to, which is why the title of my someday book will be, “Sellers: I Only Loved Them In 2011”. If a buyer wants a real bargain, they must look to the aged inventory, as those are sellers who are generally tired of market times and of showing feedback reports, and those are the sellers that can still be massaged into signing onto an actual deal. New sellers, not so much. Second, unless you’re an upper bracket lakefront buyer, be prepared for somewhat limited inventory. I’m sure we’ll add some inventory as we creep towards summer, but it’s safe to say that any expected influx of inventory this spring has not happened, and likely won’t.

For now, the lake is open, and my boat is broken. I have work to do, and it involves some wrenches, a solenoid, and a complete lack of engine related intelligence. Above, a spectacular new lakefront coming to market next month.