Oops I did it again. That’s what she said in that song and it was intended to be light hearted and flirty, I think. It was supposed to be fun. But that was the 1990s and things were more fun back then. Today I realized that I, too, did it again. I didn’t enjoy my summer. Not even remotely. Not even sort of. I wasted it largely because I was busy with work and busy with projects and it rained so much that when I wasn’t busy I wasn’t in the mood. By the time the July showers turned into August sunshine, I was prematurely resigned to my fate. So yes, I did it again. Shame.
The market this summer was really quite something. The market went from dull to hot to warm to cold to motivated to ambivalent, and all of that in the period of a few weeks. One week the market felt alive with energy and activity, the next it was a tomb. One week on, one week off. The market pause that I’d been expecting certainly arrived, but it arrived without an influx of inventory. A lack of inventory makes price discovery difficult, but at this point in 2024 I think it’s rather obvious that pricing has remained stable from summer 2023. I wrote about this phenomenon in my winter magazine in January of this year, and what I wrote then has proven true now. Pricing that aspires to escalate values from prior comps will fail, while pricing that honors recent comps and seeks to align with them will succeed. Imagine not understanding that. Of course it’s even more complicated than that, as sometimes the prior comp was also priced too high, and it’s a good time to remember that just because someone paid something for a certain place doesn’t make that price repeatable.
The market today remains very light on inventory, which is creating a nice dislocation from what I can tell. There is value to be found, even in a light inventory environment, though buyers are mostly hesitant to take advantage of the situation. Today there are only four lakefront homes for sale, with at least three more pending sale. I have two pending off-market today, and my 8 Hillside (on market) is under contract as well. There were two sales in the South Shore Club recently, one of an off-market opportunity and one on market. The pricing affirmed my valuation theory for the SSC, and I’m glad to see both pieces of inventory find buyers, even if I’m deeply bitter to have not been involved in either transaction.
I would guess this fall will feature a continuation of the summer market on the lake. Limited inventory, plenty of buyer activity, but with an overall lower level of motivation. I think the danger for buyers today is to either give-in and buy something in a lesser-than location, or to succumb to the Overton Window pricing practice, that might lull a buyer into thinking a price reduction must create value regardless of the actual market. For sellers, it’s likely a price reduction theme that continues through the fall.
But what of this fall? It’s not even here yet. It’s still summer. In fact, it’s the best variety of summer. It’s quiet summer. It’s summer for the ownership without a cameo from the tourist. September and October are easily the best two months of the year here, and I feel uniquely privileged to live in this place after a brief visit to Phoenix last week. More on that visit to hell later, but for now, it’s still summer at the lake and you should be here.