South Shore Club Slide

South Shore Club Slide

Ideal Impressions Photography

No, there isn’t a big water slide at the South Shore Club, although now that I think about it, that may be a terrific idea. Given the state of the market at the South Shore Club at Lake Geneva, and a sales pace that would make any self respecting snail blush, I doubt the developers would indulge me and my slide. The slipper slide more pertinent to today is the downward ride that the sales prices have been on at the South Shore Club, and this is hardly a new trend. The vacant parcel sales are in my focus today, and the numbers that I’ve dug up represent a very clear, very interesting price direction for the beautiful lakefront association. A beautiful association that offers a fabulous swimming pool with clubhouse, private lakefront piers and a massive lakefront park, putting green, tennis court, playground equipment, and complimentary use of a fleet of boats and PWC’s, including Cobalts and Boston Whalers.

For the sake of this post, I’m only going to use the ten South Shore Club vacant land sales that appear in the MLS records. These sales date back to 2004, and obviously do not account for all of the initial sales that the developer completed. The ten sales paint a very clear picture of where the South Shore Club is heading, not by where I’m guessing it’s heading, rather an obvious trend that the statistics reveal quite nicely.

First things first. There are currently eight vacant lots on the market in the South Shore Club, priced from $699k for a resale by the tennis court, to $1.751MM for lot 15, which is, in my humble opinion, the most desirable lot left given its tremendous lake views and near pool location. The average list price of the eight active parcels is $1.32MM and change. To gauge where the average list falls in light of the average sale (of the 10 MLS sales), you have to know that the average sale price is right around $1.22MM. Not bad in comparison, but these aren’t the averages I’m looking for, so let’s just use these as a reference point for the really telling figures that present themselves when looking at sales trends.

Of the ten MLS vacant parcel sales, the average list to sale ratio hovers right around 80%. So on average, a buyer is able to negotiate 20% off the asking price, which is a pretty solid statistic that favors a buyer. Of the ten sales, the majority of the sales took place during 2007, when the developer sold five lots. The list to sale average for all ten lots is 80%, but the list to sale ratio for the 5 lots that sold during 2007 is lower, with a 72% list to sale ratio. The miserable year that was 2008 didn’t give us a single MLS vacant lot sale at the SSC, and the most recent sale closed just this September. The lot that sold two months ago carried an asking price of $1.39MM, but sold for a buyer pleasing $799k. The list to sale for this sole 2009 sale? A stumbling, bumbling, and fumbling 58%.

To chart the direction of the sales at the South Shore Club, one only needs to review these list to sale ratio’s. Historical average at the SSC: 80%. Average during 2007, the last year to record multiple sales : 72%. Average for the only sale YTD in 2009: 58%. That’s a market in decline, and I’m not the one guessing that it’s in decline, the numbers are clearly telling us as much. The combined tax bill for the remaining developer controlled lots is around $68k, which can’t feel good at the end of January no matter who you are.

I take this increased motivation on behalf of the developing group to mean two things. First, the market here is ripe to give up a deal or eight this winter. The best time to negotiate a deal in Lake Geneva is from Thanksgiving through the middle of January, and when you’re trying to take advantage of a market that has already proven itself willing to be taken advantage of, well that looks like the perfect storm for a savvy buyer to me. The sagging list to sale ratio also proves my point that Lake Geneva sellers don’t discount asking prices as much as they negotiate off of them. Just because a sellers asking price hasn’t waivered much, doesn’t mean that they’re not motivated. It’s just another example of me calling a market trend before it happens, and this trend at the South Shore Club is presenting a clear and very present opportunity, if only you’ll pick up the phone. Or text me (262-745-1993). Email works too. See you at the Lake, and if you’re smart, I’ll see you at the South Shore Club this weekend for a tour.

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