There aren’t many subjects that leave me with conflicted opinions. When Old Yellar has to be shot, I’m not sort of happy because that means he’s no longer suffering from the rabies, I’m just downright sad. When my sorry Cubs let James Loney launch a grand slam into the right field bleachers in game 1 of the 2008 playoffs, I was not happy for him. I sat in the stands, dejected, just as the other 40,000 foolish sorts who paid too much to watch a heartless team play baseball. Whatever the situation, I am rarely confused. Partly out of stubborn closed mindedness, but mostly out of a keen awareness of cause and effect, and the reasons that certain things just must be.
The Geneva National conundrum is a peculiar one, as Lake Geneva real estate markets go. And be sure it is indeed a conundrum. Geneva National has been the hottest of our individual markets, and it has been colder than a Winnipeg winter- and those extremes were reached in the first 10 years of its existence. In the decade that has followed, the market has followed a similar trajectory, at once soaring with the hottest real estate markets in the country, and now again, a barren wasteland of cedar and stone and too much garbage cement board, a scene more befitting the solitaire of a Fargo highway than a leafy Lake Geneva drive.
It’s January 14th, 2011, and Geneva National looks much like it did on January 14th of 2001. This is not progress. The reason for the down market remains the same today as it was then. An illiquid market that had been intentionally and irrationally flooded with inventory on the assumption of a never ending stream of buyers, and a huddled mass of owners that can barely cut prices fast enough to attract the three or eight buyers that remain. I know some of the reasons that Geneva National had a dismal 2010, and as those theories pop into my generous brain I’ve been quick to relay those to you.
The lack of equity in the primary homes of the target buyers is one obvious reason for the lack of buyer traffic. The overall softness in the bread and butter price range ($200k-$600k) of GN is another. But those reasons alone should not be enough to almost completely and thoroughly snuff out what was a wildly popular development just three years prior. Am I really that accurate in my market assumptions? Can a simple lack of home equity be that ruinous to a market that has exhibited impressive strength over most of the last decade? I don’t think so. There has to be another reason.
It’s no secret that condominiums have had a rougher go of the last three years than that of single family homes. The lakefront condo market has slowed, the off-water condominium market has slowed, and Geneva National has slowed. Abbey Springs might have bucked the trend, but a singular resister doesn’t mean all that much. The condominium is down, and at Geneva National it’s just about out. The lawsuit that bothered the GN market for a few years never really dented the market there. The suit was brought by a group of owners who didn’t like the tactics of the declarant, and sued to make their feelings known. There were internal rumblings that the suit hurt the market there, but I don’t think it actually did. The suit didn’t bring the market down, even if some of the developments within GN that prompted the suit very well may have.
The dreary statistics will paint a picture of a market in a funk, and I fear the funk is going to be with us throughout 2011. There were only 27 sales (per MLS) in GN during 2010, not including vacant lot sales. There were 31 sales in 2009, making Geneva National the only individual market that I follow that didn’t experience some sort of volume recovery during 2010. When the rest of the market is increasing volume and yours is subtracting it, there’s a problem. Piling on, there were 45 sales in GN during 2008- and 2008 was a miserable year.
I truthfully don’t know what’s eating GN, but it’s obvious this is a market in need of a sales burst in the worst way. GN is a beautiful development with 54 holes of the most inspiring golf in the Midwest. For buyers seeking a country club atmosphere behind gated security, this is your best option within 100 miles, and probably further. Geneva National will once again find favor in our marketplace; it’s just too perfect of a development to not attract buyers over the long run. Unfortunately the long run matters little if you’re a seller looking to sell in 2011. As one of the few brokers to have lived in GN over the years, I’m your guy if you want to take a look at this stellar development, warts and all. The developments, not mine. I don’t have any. Not a one. I swear.