2013 Lake Access Market Review

Lake access is the great equalizer. The term, Lake Access, also known as Lake Rights, both times capitalized for the sake of importance, is everywhere at Lake Geneva. It has become part of our vernacular, and I’d go as far as saying that we, as a community, take the term and the rights it bestows for granted. Outside of this market, lake access is not all that common. Sure, some communities on some other lakes, or oceans, have little access points to get to the lake, salty or otherwise, but at Lake Geneva we have associations with parks, piers, swim rafts and diving boards. We put the FUN in Lake Access, which is particularly hard to do given the absence of an f, u, and n, in the term.

Homes with private lake access, those off water homes that lay claim to some common ground on this lake, those are the homes that help define this market. As a lakefront owner, you are entitled to that shoreline, to your private pier, to your riparian lines. You own that property, you and you alone. But when you’re out on a boat, circling the lake en route to dinner, and you, as a lakefront owner, pass by many other lake revelers on their own boats, you are as they are. They are going to dinner at the same place you are, they are skiing on the same shore you are, and they are sitting on a pier in the same way that you sit on your pier. Lake access, these are the rights that level this watery playing field.

While lakefront ownership requires a rather thick wallet, lake access ownership does not. Consider the 58 lake access sales from 2013. One was at an eye popping (gouging) $1.1MM, but seven printed at, or under, $200k. One was bought for $75k. These are homes that are attainable to many, and this is what makes Lake Geneva not only a playground for the rich and famous, but also for the discerning. You needn’t be insanely wealthy to own a vacation home near this lake, you just need to be exceedingly discerning.

This lake access market was incredibly active during 2013. While we had an uneven recovery in this segment in prior years, this last year saw sales in every price category of this market. The entry level lake access home sold well, with 22 sales closed under $350k. Another 22 homes sold between $350k and $650k, and the remaining 14 sales printed between $650k and $1.1MM. I was especially pleased to participate in eight of these sales. The activity in the market was mostly uniform throughout the year, with closings occurring at a steady and expected clip. As an interesting side note, of the 58 lake access, off-water sales, 35 of them were registered as financed transactions, and 23 were cash. That’s a great ratio for this segment, as the high percentage of cash buyers add strength and stability.

Absent from the 2013 sales was a single MLS transfer inside of our co-op communities- the Harvard Club, Belvidere Park, and the Congress Club. Over the prior three years, each year had a sale or two in these communities, which was a rare string of inventory inside typically tightly held neighborhoods. I’m actually happy that nothing was available over the year in one of these venerable enclaves, as the market needed a reminder that offerings in the Harvard Club, for instance, should not be taken for granted. For now, three of the last three sales in the Harvard Club were represented by yours truly, as was the only MLS sale in Belvidere Park over the past 20 years. The Congress Club didn’t have any public movement this last year, signaling strong and contented ownership there as well. Keep this inventory drought in mind next time you see an offering in one of our rare cooperatives and react accordingly (with haste).

The 58 sales from 2013 outpaced 2012 by 9 sales, and it beat the 2011 volume by 12 sales. If you cast your eyes back to 2006, back when it was sunny every day and real estate purchases came with a free, limitless line of credit, we only had 53 such lake access sales. 2013 truly was one for the record books, and I’m expecting similar volume in 2014. While the lakefront market has the possibility of being limited by low inventory, odds are the lake access market won’t struggle to add quality offerings. The rock bottom interest rates of 2013 had to push some buyers into the market, but I think the accelerated market returns from 2013 will serve to push the 2014 buyers in much the same way.

Above, my sale at Wilmette in Cedar Point Park. You know, the one I kept telling everyone to buy… Sold for $525k in August.