Lake Geneva Market Update

What an odd time this is. On one hand, it’s lame. Super lame. Terrible. Some people are sick. Others are rightfully terrified of becoming sick. Most of us are vigilant, wanting to do our best to avoid being an unaware source of community spread. On the other hand, it’s also lame. Businesses are closed, or closing, or limping, or thriving. I would guess very few are in the last category, though I might be wrong. Luxury real estate at the lake? Limping.

In spite of being deemed to be essential, it should be no surprise that this is bad for business in the short term. I see my competitors spouting off about how this isn’t bad for housing. Yes it is. If you think it isn’t, you’re either ignorant, or super ignorant. The gears of this business have slowed, and even though they are technically still churning, the efficiency of the movement has vanished. Deals are happening, but at a glacial pace. Let’s look at what’s been selling.

I’ve been fortunate through this, not only to be well prepared to weather whatever sort of storm this might be, but to have had a very good early part of 2020. January and February and the fist half of March brought me almost $10M in sales volume, which is proving to be quite important. I’ve matched two more buyers with sellers over the past two weeks, as buyers looking to spend their summer elsewhere still find motivation to get deals done. After all, this isn’t just about today. It’s about tomorrow and a year from tomorrow and ten years from yesterday. You cannot plan for the future while being focused on the present, it’s just not possible. So buyers still buy, and I’ve had two deals, both in Cedar Point Park, come together recently. That makes me reasonably happy.

The remainder of the lakefront and lake access market has also seen some movement. There are two new pending contracts close to the lake, one on Chapin Road and one in Somerset. These two properties, around the $1M mark, represent likely vacation home purchases. There have been some lower priced contracts find sellers in Country Club Estates, Indian Hills, and Brookwood. The market continues to move, even if at a much slower pace than we’d typically experience during March and April. Showings have been holding fairly steady, though upper bracket showings have cooled. This is to be expected, as the wealthy wait to see if we’ve established a bottom in the stock market or if we’re just bouncing along still looking for it.

I anticipate activity will continue at this choppy pace for at least the remainder of this young month, and likely into the middle of May. But there is hope here, as I sense the market is going to rebound in activity very quickly once we enter a period of confidence improvement rather than one of deterioration. There is a sizable lag in all real estate contracts. An increase in activity does not mean an immediate increase in contracts, and an increase in contracts does not signal an immediate increase in closings. This machine doesn’t start or stop quickly, so we can look forward to a very choppy next one to three months at the lake.

Listings have slowed, as many sellers recognize the possible dangers of letting strangers wander through their homes and open the junk drawers in their kitchen. If you think I said drawers instead of drawer by accident, you’ve obviously never been to my house. My wife likes to keep kitchen drawers in a condition of surprise. Surprise, the fingernail clippers are in the drawer with a ball of twine, the lighter, three hair clips, a wrench, two ping pong balls, three bills I was supposed to pay 30 days ago, and a renewal notice for her license plates from 2019, and also one chocolate and almond Kind Bar. Still, listings have slowed and we can expect that to be the case for the foreseeable future.

As I wrote last week, or the week before, there is still reason for confidence in our housing market. This will serve as a wake up call for vacation home buyers that have been putting off their purchases because of a desire to find something perfect. They’ve spent the past several years letting their whims get the best of them. Once this viral smoke clears, I expect to see a re-engagement of the vacation home buyer, but even that expectation has a few strings attached. We’ll need to see a rebound in consumer confidence (broadly) before that buyer will reemerge. We’ll need to see a recovery of some meaningful level in the stock market before that buyer will show up, confidence in tow. Do we need to recapture S&P 3300? Of course not. But buyers will need to know the bottom is in and they’ll need to see some improvement in their balance sheets. Once that happens, whether that’s in May, June, July, or October, or February, I expect the market to get busy making up for lost time.

As always, if you need me, I’m here at my desk, plodding through my new office project build in Lake Geneva, showing homes, helping sellers make the best decisions through this crisis, and working on the 2020 issue of Summer Homes For City People. The show, it seems, must go (limp) on.

Above, sunset from my lakefront listing at 614 Sauk Trail, Fontana $1.99MM.

About the Author

I'm David Curry. I write this blog to educate and entertain those who subscribe to the theory that Lake Geneva, Wisconsin is indeed the center of the real estate universe. When I started selling real estate 27 years ago I did so of a desire to one day dominate the activity in the Lake Geneva vacation home market. With over $800,000,000 in sales since January of 2010, that goal is within reach. If I can help you with your Lake Geneva real estate needs, please consider me at your service. Thanks for reading.

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