The equity market rally from 2023 and a slow decline in long term interest rates should set up 2024 to be another solid year for the lakefront market here. Buyer demand has softened modestly, but inventory remains constricted. A glut of buyers during the covid-era was nice, but I believe in 2024 we’ll prove that an even pace of supply and demand is more than enough to keep our lakefront prices stable. The key for 2024 will be a controlled supply of inventory and pricing that accurately reflects recent comparable sales. Aspirational seller pricing will likely be met with buyer resistance, but proper pricing of lakefronts in quality locations will undoubtedly be absorbed with ease. If the equity markets hold up and rates continue to soften, I think 2024 is going to look a lot like 2023.
I wrote that on February 1st, 2024. If you know one thing about me, it should be that I am not shy about saying “I told you so”. If you didn’t yet know that, you could have asked my wife and kids. On my tombstone, please leave out any flowery, uplifting messages of hope or love or endurance and just write “I told you so”. Alas, my prediction for 2024 came true in a most accurate fashion. When you have visibility into nearly all off-market transactions and insight into the mindsets of both buyers and sellers, you, at the very least, have a good chance of making accurate forecasts, and I’m happy to be the one to deliver those outlooks. Other agents are happy too, as they get to use my insights in their own sales efforts, and so to that what can I say except you’re welcome?
We started 2024 with a few left over 2023 contracts, the most important of which was my sale at pier 501. That sale just under $13M was the second highest sale of 2024. But we also started the year with a few bits of aged inventory. That was the inventory that introduced in 2023 with wildly aggressive seller pricing, the sort that assumed the covid mania was never, ever, going to end. Those agents and their sellers were wrong, and 2024 forced them to acknowledge their error. By early summer 2024 we had cleared much of that aged inventory, and introduced a few more bits and pieces of lakefront opportunity. The market plodded along without any unique urgency or excitement. I then sold Aloha Lodge for $22M, making it the most expensive sale of the year and the second highest priced lakefront sale of all time, riding shotgun only to my $36M sale of Glanworth Gardens in early 2022. The summer wore on and some buyers bought homes for too much money and others negotiated nice 2024 prices. And then something happened.
Everything sold. Off market listing that had been for sale quietly for many months or a year, sold. New inventory was nonexistent. Sellers didn’t find aspirational pricing interesting. Buyers asked what happened. The market locked back up and started to look more like early 2022 than late 2024. Was the cycle aging or stalling or did it just re-set entirely?
Let’s consider what we learned in 2024. We learned that pricing needed to reflect comparable sales. We learned, or were at least reminded, that inventory overcomes all other market conditions and factors. We learned, or were at least reminded, that Lake Geneva is the absolute, unchallenged king of the luxury real estate market in the entire Midwest. And we learned that even in a year when inventory grew (at times) and the market stalled (for a while), pricing remained stable. What more could you ask for of a market? Are you not entertained?
The average lakefront sales price increased from ever so slightly from $6,382,895 to $6,406,652. The price per front foot, one of my most hated metrics but still the market favorite, increased from $72,000 to $72,896. Meanwhile, the price per square foot decreased rather dramatically after spending the last two years around $1400 per foot, now measuring $1152 per square foot, which is closer to the 2021 average of $1008 per. The market phenomenon of compression when viewing parcel size and frontage width remained constant, as did the proliferation of off-market sales, though there were fewer in 2024 than in both 2023 and 2022.
We’ll discuss what’s ahead in another post, but for now, I hope you enjoyed the year that was. I actually didn’t enjoy it very much, and I don’t really enjoy what the current market conditions are going to do to seller expectations. Even though 2024 was a stable year with strong production, we still closed just 17 true lakefronts (I should add, all of this information is from MLS and known true lakefront sales). Sellers should be aware that even though the valuations were similar, the market temperature was still cooler in 2024 than 2023. I’ve used this market comparison to help both sides understand the dynamic that we had in 2024, which is going to be a similar dynamic to 2025, and this is in spite of a lack of inventory. In 2019 we had 100 buyers looking for lakefront houses (the numbers here are for comparison’s sake). Of those buyers, 22 were uniquely motivated to purchase. In 2021, we still had 100 buyers, but 86 of them were uniquely motivated to purchase. And in 2024, we still had 100 buyers, but 28 of them were uniquely motivated. The buyer pool for Geneva never changed, nor did the total number of participants. But their motivation waxes and wanes on a whim. Equity markets up strong on the week? You might see some more motivation. BTC and friends charging to new highs? Maybe a few buyers engage. Interest rates drop below some meaningful benchmark? Maybe someone joins the ranks of the motivated. This is how our market works, and it’s going to keep working that way until further notice.
For my involvement in the 2024 market, I closed the five most expensive lakefront sales of the year and eight of the 17 lakefronts that sold. My sales volume was once again in excess of $116M, which was more than double the next highest producing Walworth County agent. That sales volume will likely place me as the top agent in Wisconsin for the fifth year in a row, so that’s all nice. I’m grateful to be here in Lake Geneva, doing what I do best: Irritating my wife and serving my lakefront buyers and sellers with the highest level of service I can muster. If you’d like some help at the lake, I’ll be here.
Above, my sale of Aloha Lodge. What a house. What an honor to place the buyer.