In 2004, at what was the height of the national tear down craze, the tear down had already elevated to hated status. Not hated by the tearee, and not so much despised by the tearor, but abhorred by the neighbors of the tearee. This comical era in our recent history looked less to be standard gentrification and more a contest. The contest was to see who could build the largest, most out of place home, on the smallest city or suburban lot. Yards? They were overrated. Walk in wine closets kept at the ideal temperature for sipping dolphin tears? An absolute necessity.
Mercifully, the tear down craze ended sometime during 2008, and the past three years have featured a more controlled building environment. Controlled, that is, as long as we aren’t talking about the Lake Geneva market. Tear downs here existed in 2004, just like they existed in your zip code. But the total number of tear downs that existed then has only been eclipsed by the number of tear downs now. While other markets have taken a flier and promised to consider gentrification again at some point far into the future, Geneva is full steam ahead, intent on ridding the lake of substandard structures through less than diplomatic use of the wrecking ball. (Current tear downs are under construction now in Club Unique and Glenwood Springs, among others.)
While our market continues to thrive on lakefront and lake access tear downs, 2011 featured a child sized handful of true vacant lakefront sales- no demolition required. The MLS counts just two true vacant lakefront sales in 2011, both on North Lakeshore Drive in Fontana. Both were deep lots, but they were not too similar otherwise. One lot, large and wide and sloping only gently from the road onto a large, level grassy swath, sold for $2.5MM. With 132′ of frontage and 2+ acres, this was indeed a beautiful parcel. The sale at $18,939 per front foot was in line with similar size level parcels from 2011 and 2010. In an example of what is a very common lakefront practice, the lot was purchased by the next door neighbor whose current impressive spread was made eye popping by the addition of those 132 level front feet.
The other lot was just a saunter down the road, closer to Fontana. The lot here was the third of three lots that were created through a tear down and subsequent subdivision of a large lakefront parcel. While most lakefront development is dreadful and should be avoided, I have little trouble with the creation of 100′ or greater lakefront lots. For a seller to attract the interest of a buyer who wishes to pay $6MM for vacant parcel, he’ll have to work overtime. While that buyer does exist (see Alta Vista sale from 2010), it is much easier to find three buyers to pay $2MM than to find that singular golden goose. The other two lots (total purchase price $5.2MM) of these created three were purchased by the same gentleman who has since constructed a home of epic, yet pleasing proportions.
This third lot sale closed at $1.85MM, which will, at least initially, sound cheap for 112′ of prime frontage. Ah, but I assure you there is a reason for this lesser price per foot. While the first two lots represented relatively level frontage, this third, and southernmost parcel was elevated to the point where native Hawaiians, if pressed, would admit to a strong desire to dive off of the highest point. This sale is a nice reminder for the market that level frontage is not treated the same as severely elevated frontage, both in terms of desirability and of ultimate sales price. Even so, this sale registered a market pleasing $16,517 price per front foot. I like the sale at that price, cliff diving or not.
We begin 2012 with just two vacant lakefront parcels active on the MLS. One of those is a lot sandwiched in between to towering brick condominiums, so unless a tower building buyer shows up that lot will likely either sell to the neighbors or not at all. The other is not a true vacant lot, as it has a substantial and suitable home on it now. It is being marketed a number of ways in order to attract a buyer, and that’s not entirely a bad idea given the market’s lust for vacant lakefront. There is another lot in Loramoor that has been on the market for some time, but it is currently off the MLS so we’ll avoid discussing it until further notice. Look for another year where the vacant lakefront market follows the fortunes of the single family lakefront market. With much of the vacant inventory from the past several years now sold, it looks to be a thin year for the vacant lakefront parcel- a lack of activity owed only to a lack of inventory.