Quote:
Originally Posted by FlyingScot
agreed. But the "smart" money on the lake is not buying for a 5-10 year return. It's a generational asset
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I wonder myself whether many of the recent waterfront home buyers getting in at these historically elevated home prices are in it for the generational asset or for a few years stay-cation knowing they are going to pay to play for a few years and then sell.
Either way - it is an expensive equation. But for a multi-generational asset I would argue a large number of waterfront homes are not well suited for that outside of a family heirloom / memory making items. They are money pits. Extremely enjoyable money pits.
Waterfront homes historically and into the future are not great investments for monetary return. At least by any way I have been able to think about it. I would love to be convinced otherwise..
Outside of Moultonborough, it isn't uncommon for decent sized water front homes to have $20,000 + tax bills. $2,000+ insurance, $3,000+ utilities, maintenance? landscaping / winter care? annual dock & boat expenses?
If this is a second home it is exactly that - secondary expenses on top of everything else in life, too.
Believe me - I know there are many many many people that can afford the 40k+ annual operating expenses happily while they are getting use out of it (covid). I also know many people that fall into that category of wealth who would never pay $40k a year in addition to the mindshare to maintain it without getting significant use out of it.
In my opinion, waterfront homes are meant to be enjoyed in the current. Otherwise unless you are the Marriott family there will be many annual checks that gets written which you look twice at. There is a reason water front homes turn over more frequently than non waterfront homes.
Long story short - I think their value is more directly tied to peoples immediate interest in the region and overall economic conditions. Both of which are at historical peaks this very moment.