Speaking of rising tides, two more lakefront homes just sold this week. One of those homes was sold by yours truly, the other, sadly, by someone else. These two sales bring the 2014 lakefront sales tally to 12, and I’m pleased to have represented either buyer or seller in 4 of those. It should be noted, for those concerned, that except one transaction side by ReMax, all other sales were either by me (Geneva Lakefront Realty), or Keefe. Considering talking with XYZ Broker about buying or selling a lakefront house on Geneva because they said they’re a Lake Home Specialist? That might not be such a great idea, if we are to trust past performance to leave us clues as to future results. Anyway, the sales.
The not-Dave-Curry-sale was over on Forest Rest, and it closed for $2.5MM. It was a modest house, with a 113′ lakefront lot, bordered on the West by a parking lot and an association pier. The property was nice enough, and the price of $2.5MM was just $150k under the price that the property had sold for in 2005. I haven’t made many secrets about my disdain for our current pricing models, and this sale again tests my resolve. Are we, as this sale suggests, nearly back to 2005 prices? As I wrote the other day, there are actually several active properties and a few pending properties that possess prices that would be seemingly too high even if we were chatting lakeside on an 80 degree, cloudless day in July of 2007.
If this is the new market, how quickly we’ve moved to embrace it. Remember this January, when I gladly sold an Oak Birch lakefront for $1.81MM- the same home that had sold for $2.85MM in 2008? Those were the days. Have we moved this much, this quickly? Or are these sales a handful of outliers, each one moving to its own rhythm and making its own sense to only its own players? Is $2.5MM on Forest Rest for a basic house on a fair lot anywhere near as good as $1.925MM on Southland for a modest house and a tremendous lot? I’m leading you here, but the questions persist. Is the market so dramatically changed over recent months, or is a buyer on Forest Rest for $2.5MM just a buyer on Forest Rest for $2.5MM?
Unfortunately, we cannot quarantine these sales. They exist for buyers to base value on, and for sellers to justify value from. If Forest Rest prints at $22,000 per front foot, does that mean we get to assume everything prints at $22k per front foot? Of course not, but it matters even if I don’t like it. Rather than viewing this as a case of mad love, I’ll consider this yet another sale that may have come to pass because of the poor overall inventory in the $2MM to $3MM price range.
The other sale, the one that I was indeed involved in, printed for $1.925MM on Monday. This sale was on Geneva Oaks Trail, that of a foreclosure that only the truly astute would have known about. This property was complicated, as was the transaction, and when it finally sold I had represented a mortgage company and another broker represented a buyer who was pleased to secure value. With 100′ of frontage, the $19,250 price per foot looks better to most on the buy side than does the $22k per foot from the other sale. This property had been for sale previously in the $3MM range, but it was never worth that much. Even so, this is a $1.925MM print of a property that had seen peak market listing time in the $3.5MM range, and we can all be glad that it closed where it did.
Both of these sales were recorded as cash, meaning we have added two new, strong buyers to the lakefront. Eliminating a foreclosure this quickly and in an off-market fashion is a huge boost to the market, as foreclosures usually sell quickly on the lake, but there’s no way to know what will happen to the pricing if they dawdle on the market and require adjusting to find a fresh buyer. As a side note, please consider that this sale was a private transaction, meaning everything good and available is not always on the MLS. Interested to learn about some off-market opportunities? Maybe email me?
Another sale from this week bears mentioning- an off-water home in Trinkes closed for $800k. That’s a decent home with a lagoon slip on a large lot, so $800k isn’t so bad at all. Would I have rather bought my Sidney Smith sale with private slip in the open lake and a large lot one house from the water?
Above, Geneva Oaks Trail REO sale.