I awoke this morning to a rumble of thunder. I do love sleeping on dark, drizzly, rumbling mornings, but alas, I am not retired nor am I the sort that can sleep past 6:30 even if I tried, so I got out of bed and contemplated what I should write about this morning. I felt like I should do a foreclosure update, since it’s been a while since I last touched on the foreclosure scene surrounding Lake Geneva vacation homes. Then I thought about how much I hate writing about foreclosures, primarily because I find them a tedious bore. I’d rather roll around in a patch of potent poison ivy than write about foreclosures, and for a brief moment, I weighed the pros and cons of each. After some deliberation, the foreclosure update won, but by a razor thin margin.
I checked the properties scheduled to be auctioned at the Sheriff’s sale, and skipped out on researching the lis pendens filings for now. Why? Because if foreclosure updates bore me, checking three or four hundred lis pendens notices renders me downright apoplectic. The foreclosure market appears to have stabilized over most of 2010, and I continue to believe that this foreclosure “crisis” isn’t going anywhere soon. I also think, like many, that there will simply be a new elevated foreclosure norm as we head into the foreseeable future. Now that foreclosure isn’t carrying the social stigma that it once did, and negative equity is likely to be around for several more years (many markets lopped off 40% in 24 months and may take the better part of a decade to get those losses back). What? Don’t believe me about the decade comment? Consider the Lake Geneva market and some historical performance. The real estate market here sputtered from the mid 1980’s through the early 1990’s, leaving the possibility of a lost decade of appreciation quite likely for many national markets. Is Lake Geneva going to sputter for a decade? Not a chance.
The foreclosure scene in Walworth County is dominated by a handful of municipalities, and a relatively concise price range. Elkhorn, Whitewater, Genoa City, and the City of Delavan have ruled the sort of thing that no one wants to rule- foreclosure proceedings. The price range that appears most affected is the $130k to $230k range, even though several higher priced properties are on the auction block right now. The vacation home market around Geneva has been largely spared from the foreclosure plague, though we still have a few issues that are persisting and likely to stick around for quite some time.
Geneva National appears to have more foreclosures than I’ve noticed in past updates. I counted at least six properties currently scheduled for sheriff’s sale in the next 60 days. Many of those are either vacant lots or single family homes. The condominiums in GN have not been as likely to face foreclosure, which is something that continues to surprise me. Common sense tells me (and lenders and appraisers) that condominiums are more likely to “fall” into foreclosure as the combined burden of monthly association fees with a fat mortgage payment can cripple financially distressed borrowers faster than you can say lis pendens.
I didn’t see a single unit at Abbey Springs pending sheriff’s sale at the moment, a nice sign for that large lake access association. Abbey Ridge in Fontana has one unit that has been in and out of foreclosure trouble and is back in at the moment. The Abbey condotel units have also held up fairly well, though there is at least one of those units pending foreclosure at the moment. Grand Geneva timeshares will be a staple at foreclosure auctions both this summer and for years to come, so please do your best to resist the free $100 gift card and stay away from timeshares in any market.
Cedar Point Park in Williams Bay has at least one pending foreclosure, and like the Abbey Ridge unit, that property has been fluttering in and out of foreclosure trouble for the better part of a year. I don’t see anything pending in any other Williams Bay lake access associations, which is a nice sign. A single family home in The Birches (south shore, Linn Township) will be up at auction soon, as will another property in Geneva Township owned by the same developer. Speaking of developers, a local builder appears to have fallen from grace and has several foreclosures pending against properties that he currently owns. Some are in Geneva National, one is in Williams Bay. Watch to see what happens with that situation, as it might provide an opportunity to buy some Geneva National lots on the cheap.
Lake Lawn Lodge in Delavan is still flying directly into a rather large, surprisingly rocky, mountain. There are several foreclosures in there, and the development as a whole is not looking like anything you want to touch. If someone handed you a 20 foot pole and told you to poke it, you shouldn’t. There is something brewing on Geneva right now, but the foreclosure appears to be more of a forced action between business partners, rather than an outright foreclosure. I’ll watch that one for you, but I’m doubtful the property will ever come to the market.
For now, keep watching the foreclosure market, but don’t hold your breath waiting to purchase one. It’s a very small portion of our vacation home market here, and the lack of foreclosure activity is a sign of tremendous strength by those who own the homes and condominiums that make up the Lake Geneva vacation home market. If you’re keeping track at home, foreclosurenet says there are 161 bank owned properties on the market in Walworth County, and a 773 such properties in Berrien County, Michigan. Sorry Michigan, perhaps 2011 will be better.
(My foreclosure updates reflect the general condition of the foreclosure market, and while I do my best to provide accurate information, the rapidly changing nature of foreclosure proceedings and scheduled auctions means you shouldn’t rely solely on this post to assess the foreclosure situation in Walworth County)