The articles that grace the front page of the Chicago Tribune’s Real Estate section are generally not the sort of articles that one would want to put on the front page of a newspaper like the Chicago Tribune. They are generally AP stories, or the sorts of vague stories that look like AP stories. You’ve seen them before under headings such as “How To Stage Your Home To Sell!”, or the ever popular “Rent Vs. Buy?”, or what about “Millennials- Renters For Life”, or my favorite “Tips For Vacation Home Buyers”. These articles are puff pieces, fillers. They are the print version of the live news report from the Zoo when the reporter explains how there are giraffes there. There have always been giraffes there. And for as long as there have been giraffes at the zoo, there have been vague stories about vague real estate concepts.
Last Sunday, which is the only day I subject myself to reading that written drivel, there was a front page article whose official title escapes me. It was, something like, “Over Improving Real Estate”. There was an image of a cartoon house, with a bunch of decks and fancy looking attachments. The article was intent on telling you not to over improve your real estate. The theory is sound. If you buy the biggest house on the street, you’re not the brightest real estate bulb. If you buy the worst house on the street, good for you, but then avoid making it the biggest, fanciest house on the street. This is good, solid, if vague, advice. This sort of topic is one of the reasons that Geneva is such a draw for the uber-wealthy, because try as they might, it would be very hard to become the biggest house on this great lake. On the contrary, if you wish to build a big house in Vernon County, Wisconsin, beware, building over 2500 square feet just made you a .001%er.
Geneva is a big proponent of over improving, and while I am a fierce opponent of the act, one look around this lakeshore proves that I am in the minority. If bigger is better, then gaudier is more beautiful, or so the recent story here goes. The strange thing is that our market selectively punishes those who over-improve. There are some cases where big homes were built for big dollars in locations that would rather not support such personal indulgence. Those homes, in many cases, were foreclosed on or otherwise taken from those excessive hands. Today, however, as I scan the MLS, I see at least one property that I would deem over-improved that the market has chosen to reward.
There are three new lakefront and lake access contracts pending, and one of those caught my eye. Two of the three are normal-ish homes. One is on Sylvan Lane, just East of Knollwood. I don’t really like $800k for a lake access home that lacks a boatslip and is absent any spectacular defining characteristic. Milquetoast is desirable to some buyers, so I suppose I should be happy for that segment of the market. The other home is a lakefront, wedged in between two other lakefronts, priced just under $2MM. That home is pending sale today, and while I think that it’s a nice house for that money, I do think there’s something rather humbling about being a small home in between two big ones. The Tribune AP placement person would tell you that it’s good to be the small home on the block. I’d tell you that it might be theoretically good, it can be a big of an ego drag to pull up in between two relative behemoths. But still, the price will be fine for the market, I suppose.
The third pending sale is the one that proves over-improvement on the shores of Geneva is not necessary something the market punishes. If you told me we’d be wedged up against a large association pier, on just 60′ of elevated frontage, mere feet from neighboring houses on nearly all sides, I’d tell you that we won’t be listing that house for $2.6MM. No matter the level of gild, it’s not something that we should find interesting. But remember, that’s us, and we’re the smart ones trying to navigate a market filled with unique pitfalls. That home, the one with the pool and the fancy, just found a buyer. $2.6MMish proves that over-improving on the lakefront is something that can’t really be done, as long as the style is mainstream enough to appeal to most buyers.
I add that last bit because there are specific styles that can easily scare buyers away and cause them to avoid any level of polish. If you build a mediterranean villa, and it’s super mediterranean villa-y, then you better hope for a buyer who adores that particular style. Likewise, if you build a log cabin on this lake, because we know Geneva to not be up north but to some people it is their own personal Minocqua, you’re going to have a hard time attracting buyers if you overbuild. But if you build in a lake-sensitve style, and your price range is $3MM or below, it’s nearly impossible to over improve a setting, as much as I wish that weren’t the case.
This Sunday, let’s all ready along to see why you should “Paint Your Bedroom Purple To Attract Buyers”. The article will likely be found on the front page of the Chicago Tribune Real Estate section.