I once proudly declared that I was the leading agent for total transaction sides involving lakefront condominiums on Geneva Lake. I held that distinction for many years. I would routinely sell units at Vista Del Lago, Bay Colony, Bay Shore, Fontana Shores, Fontana Club, and even the Meridien D/B/A The Bella Vista. And then, without much warning, that distinction that I had earned meant little. I could tell you that I still hold that lofty accreditation, but I don’t know as thought I actually do. Truth is, I haven’t checked in a while, because the truth is, no one cares too much about lakefront condominiums anymore.
If you own a lakefront condo, I don’t mean to say that you don’t care about it. And if you own one that you’re looking to sell, then you care an awful lot. If you’re me then you’ll care, because you’ve been charged to sell those condos that the owners care about. But if you’re a buyer, and the year is 2011, it appears as though you don’t care one lousy bit. The lakefront condominium, once the pride and joy of the Lake Geneva vacation home market, has tumbled far out of view.
I’ve told you this often this year, and the last, and for the redundancy I apologize. It’s just that the market is stuck, and as I write about markets daily, I have to remind the public that it is stuck and search for both a solution and a cause. Temporary shifts in buying behavior that occur from year to year do not typically represent any sustainable trends. In small volume markets, each year can be wildly unique and fail to signify any lasting change. But for a market to soften consistently and without pause over many years, we’ll have to assume that this is a trend. This trend that finds the lakefront condo market without buyers has been developing for quite some time now, and I think the only way to reverse the decay is to entice buyers that have already once written these units off. The key isn’t to discover a new trove of buyers, the key is to make the reticent buyers act.
That is much easier to write than it is to actually do. If I had a solution that would ramp up the buying activity in the lakefront condo market, I would gladly douse each and every lakefront building in that magical potion. I would do this if I could. Absent of magic, the only way to change the opinion of the buyers is to excite them through price. I’ve tried that with my beautiful lakefront condo listing at Fontana Shores. I’ve dropped the price nearly $200k on that sprawling residence, and a seldom few have noticed. I dropped the price on my Bay Colony listing (now off market) another 20% and I elicited far more yawns that offers. Is this not enough? Is the market not impressed?
The answer is obvious. There will still be buyers for lakefront condominiums. Buyers that seek views and slips and piers and maintenance free weekends, but those buyers are very difficult to find. There has been extreme value on the lakefront in the form of another Fontana Shores unit- a unit that appears primed to be stolen- and yet it sits off the market now, with no apparent buyer. A pretty girl with no date to the prom. I’d take her and wine and dine her and save her from her spinster fate, but I’m married.
Other units have been cut to the bone as well, including one at Vista Del Lago ($365k) and others at the Fontana Club (now off market). There is value on the lakefront, and if buyers are holding out waiting for pricing that reflects their personal expectations, I’d say that that pricing adjustment has, for the most part, been made. If the market is, as a broad measure, off 30% from the 2006/2007 peak, then there are examples of this in the market now. These discounts are not so much represented in list prices, but they will be taken after the negotiation. Buyers waiting for sellers to reduce to entice them are misguided. The negotiations will provide the reduction. The discount will not be marked on the garment but you can bet it’ll likely be taken off at the register.
I hesitate to write negatively about the lakefront condo market, as I see value and I see importance here. But this is a blog that discusses the market in fact, not the market as I wish to see it. These are tough times for the condo market here, and I can only hope buyers will see this weakness as a sign that January may indeed be the time to strike.