Imagine writing an article on the 1982 baseball season with a specific focus on stolen bases and not interviewing Ricky Henderson. That’s what the freelancers at the Wall Street Journal just did with the Lake Geneva market. Never mind their use of construction prices from 2012 as some sort of accurate market component, I appreciate the market attention from this publication.
As the WSJ article noted, the market at the lake is indeed tight. We all know that. But it would be a grave mistake to not see beyond the current state of our limited inventory. Consider that today we have seven lakefront properties available on Geneva. Seven. Not a single one of those homes is under contract. The WSJ article failed to mention that little tidbit. The reason the inventory isn’t being absorbed is because the ownership here is largely unwilling to recognize the cracks in the national real estate market. The same WSJ wrote a glowing article on the Whitefish, MT market last month and yet most of the emails I receive from a broker there are touting price reductions. Bloomberg had an article yesterday about the Austin, TX market where price reductions are quickly becoming common after being entirely absent from the market for the prior 30 months. Mansion Global reported today that the Manhattan market is trailing off due to the downturn in the equity markets. The markets are moving, and if you want to know if Lake Geneva is immune, just check on our seven available lakefront properties that are heading into Memorial Day Weekend without pending contracts (per MLS).
Does this mean the cracks represent the initial signs of a significant downturn in these markets? Not likely, but even interjecting doubt into an asset class that spent the past 24 months mocking doubt will, as a point of fact, create some market headwind. If sellers were able to dictate pricing without any buyer interjection, we’d have seven pending lakefront sales this morning. That said, I am confident that this upcoming summer at Lake Geneva will be a robust one. There is still pent up demand. But sellers are going to need to read the entire newspaper, not just the freelance fluff, to understand where buyers’ expectations are and where they are headed. The market is hot, but perhaps it’s not quite that hot. Maybe, just maybe, buyers are following my advice which is to pay up for blue chip lakefront homes and leave the others alone. That’s solid advice in this market and in any other, at this time and at all times.
Regarding the WSJ article, I think it is unfortunate you feel that you have to denigrate it (you called it “fluff”) in the process of making the point that market forces seems to be rapidly cooling the market. I read the WSJ daily (as do many others on Geneva Lake) and they too may have also been turned off by the tone of your comments. WSJ readers tend to be sharp and they will realize already what is happening in Real Estate (the WSJ reports on this almost daily) and also that you have a personal agenda as a Real Estate agent – drive down those prices and sell quickly!
Hi Jim,
I’m a bit confused by your comment. The Wall Street Journal article was indeed fluff, (which I said I appreciated), as it failed to call out any market forces at play here and merely glossed over the market (while failing to mention that in spite of a tight market we have averaged roughly the same number of sales per year for 2021 as we did for 2017). It pointed out construction prices from 2012 as though they have any bearing on 2022 costs or values. When you say ” WSJ readers will realize what is happening in real estate” do you mean that they recognize the market is shifting and softening, albeit modestly and slowly? If that’s true, then why do you suggest I have an agenda to drive down prices simply because I, too, recognize those forces at play? You don’t get to have it both ways- suggest that I’m pointing out the market cooling and then suggest that I’m pointing it out to drive prices down for selfish gain. Rather than aiming at selfish gain, which would be most easily captured by suggesting a never ending bull market run, I seek to educate the market based on what is happening here and where I believe the market to be heading. I’ve written repeatedly with great transparency how I feel about the market this year and what I think will happen next. That’s not selfishness, that’s honesty. I have never shied away from sharing my opinions on market conditions and direction, (check what I thought about market direction in 2010/2011/2012), and will continue to share my opinions. I’ve been wrong before and will be wrong again, but my view of the lakefront market is backed by an incredibly high level of market involvement and should be considered as qualified, at the very least. I wish you the best, David