I remember well the days I felt as though I had discovered a unique arbitrage in the lakefront market. The play way back then was to buy a lot for $2M, build a house for $2M, and voila: you’d have a $5M valuation. This move would allow a buyer to find a bad little ranch on a decent 100′ (or so) piece of lakefront, where they’d build a nice, but not overwhelming home, and for their effort they’d be awarded a 25% margin. This was such a good idea, and many of my clients believed in the concept enough to pursue the package. And it’s a good thing they did, because what was 2+2=5 in 2016 has become 2+2=8-10 in 2025.
The latest example of this old trade closed yesterday on Sidney Smith Lane, and I was pleased to represent the buyer in this off-market transaction. With a mid $8 trade price, this essentially cements the market for this specific segment. A nice enough lot with a nice enough house is going to sell in the upper $7s to mid $8s right now, and I just can’t see that segment changing much in the near future.
The lakefront market as a whole is a miserable place for buyers at the moment, although it has been just that since late last fall, so it’s not really a momentary sort of condition, although I do hope it’s somewhat temporary. The last remaining lakefront offering contracted yesterday, so there’s nothing left on the open market. What a strange thing that is. Consider the summer of 2011. If you were a buyer seeking lakefront you could have come up and toured 25 available lakefront homes with me. Buyers ruled the scene, and a $4.25M ask felt a lot like a potential $3.25M contract back then. I loved the disconnect between the ask and the bid, and often succeeded on behalf of my value-minded buyers. Today there is a curious mood on the lakefront, where sellers see the inventory and think they can puff up their chest and demand the prices, while buyers, although plenty, are still (mostly) able to negotiate. This is a stark contrast to the lakefront market in early 2022, when a lack of inventory meant the sellers were able to rebuff anything that didn’t meet their newly dreamt up price targets.
The market conditions today prove out the need for buyers and sellers to work with the agent who tends to not only know what’s happening off market, but one who understands that not all pricing is accurate, and that a lack of inventory does not mean pricing can be aggressively disconnected. There is heavy nuance in play here. and it’s best navigated by a steady hand. If you’re talking about trying to buy a house in Naples or Park City or New Buffalo, I’m not your guy. You could find one of those “I SELL EVERYTHING EVERYWHERE AND AM AN EXPERT IN ALL THINGS AND IN ALL PLACES SO JUST ASK IF YOU WANT TO BUY SOMETHING ANYWHERE”, type of agents. That’s not me, not even a little bit. But if you’re hyper focused on buying or selling Lake Geneva, I’m here to help, and if you’re looking to increase your odds of buy or sell side success on the lake, we should talk.