In spite of my embarrassingly good year, I can’t help but shake my big fat head every time I see a lakefront property on Geneva go under contract. I wonder how a buyer could ever want to buy a lakefront home on Geneva and not work with me to accomplish that goal. Such is my unwarranted sense of self entitlement. The easy answer to that selfish introspection is that real estate is more about who you know than how good you are. So while I might know the back story behind a piece of property that would make it easier for a buyer to negotiate from a position of strength, if I didn’t go to grade school with the buyer 40 years ago, I probably won’t have a shot at representing him. Unfortunately for me, the kids that I went to grade school with are concerned more with paying for upgraded cable than they are engaged in the prospect of buying a Lake Geneva vacation home. Thus ends my Tom Ricketts-like whining for the morning. (If you heard him on WSCR this morning you’ll know what I’m talking about).
The lakefront market on Geneva is simply amazing, and I’m not talking about the all-season beauty of this ridiculously beautiful body of water. I’m talking about the real estate market surrounding it. As of this morning, there are five lakefront homes pending sale, with an additional property having closed just this past week. The five pending sales include one brand new pending contract that was just accepted last weekend on Basswood Drive. While much of the activity this year is comprised of new buyers who are buying their first Lake Geneva lakefront home, an equal portion consists of move up buyers who are already on the lake. When I say move up, I mean move up. Very few lakefront homes are traded laterally, and even fewer lakefront home owners sell to downsize on the lake. While much of the media would have you believe that our new national mood is grounded in anti-consumption and less motivated by largess, I assure you that as it relates to Lake Geneva, home buyers here remain of the most Alpha variety.
The sale last week was in Geneva Bay Estates, on the west bank of Geneva Bay, opposite of Stone Manor. The sale was of a beautiful home, but with an asking price of $2.195MM and a sales price of $2.15MM, I find the negotiating on the deal curious. The lakefront home was available off and on for more than a year, and the buyer was only able to negotiate 2% off the asking price? Perhaps there was a second buyer, or perhaps the buyer did the best they could and this was as far as the seller was willing to concede. Either way, the house was originally listed at $2.75MM, so perhaps it was a good deal for a turn key property with 100′ of level frontage.
For my money, I like several of the 31 true lakefront homes that are available this morning. We’re just a couple days away from the ideal strike zone of 11/15 to 12/15 for a buyer to negotiate the best deal possible on lakefront here, and there are several lakefront homes begging for offers at the moment (at least based on recent price reductions they’re begging). For the purposes of this lakefront discussion, remember I leave out the South Shore Club, the Congress Club, and any other properties that aren’t in possession of truly private frontage. The year to date sales tally is currently at 13, and if all five of the pending sales close, the 18 lakefront sales will leave us one sale short of the 2007 total of 19. I have a feeling we’ll see another sale by the end of the year that will bring our total equal to that of the 2007, pre-recession market.
The lakefront market is resilient, and the increased activity this year makes sense. The buyers who are acting are those who realize money in the bank earning a couple percent on good days isn’t nearly as enjoyable as a lakefront vacation home that pays dividends with sun splashed Saturdays and tanned shoulders.