By: Mike Kennedy|
March 28th, 2008
Category: Deep Creek Lake Buyer Info, Deep Creek Lake Market Update, Deep Creek Lake Real Estate
An article about buying a vacation home recently appeared on the CNN/Money.com website. It’s a pretty good article - and is basically about how right now is a good time to buy a vacation or second home. The author also does a good job of giving tips on how to buy a second home - from identifying the primary reasons you may want to buy a second home to suggesting that you first rent in a resort area to see how well you like it before taking the plunge and buying.
We certainly agree with the main aspect of the article - that it is a great time to buy property at Deep Creek Lake and in Garrett County - interest rates are down and demand certainly isn’t as high as we had previously seen during our boom years just a few years earlier. These two factors can certainly help the chances of a prospective buyer getting better terms. In fact at the end of last week one of our clients locked in an interest rate of 5.625% on a conforming loan that they will be using to purchase their lake view vacation home.
However, there are a few things to point out in this article that just don’t relate to the Deep Creek Lake real estate market.
First, the author tries to generalize that all second home markets are “soft” right now. While demand is down slightly from our boom years - “soft” is hardly the case here now. Just in the last three weeks we have closed on a lakefront house at Sandy Beach for $1,379,000 (that had competing offers), a timber frame home atop Wisp Ski Resort for $1,250,000, a lakefront house on Marsh Hill Road for $880,000, and two other lakefront homes for $865,000 and $750,000 respectively. And just today one lakefront house in our market had 3 competing offers! I would hardly classify this type of activity as being “soft”.
Another thing the author tries to generalize is that the appreciation rates in all resort/second homes markets declined in 2007 - or are expected to decline in the near future. Once again, that’s not accurate for the Deep Creek Lake market. In 2007, the average sold price for a residential property in the Deep Creek Lake area was up approximately 4% over the average sold price in 2006 - from $537,498 to $559,168 - a modest gain - but at least a gain unlike other second home markets. It is accurate to say that the value of a piece of property at Deep Creek Lake has held up much better than a property in other resort markets - such as Las Vegas, the Atlantic Coastal beach areas, and Florida just to name a few. This fact is just another reason to buy here at Deep Creek Lake - where historically the appreciation rates have done much better and should continue to do better than other resort areas. The main reason being that the lake is almost fully developed now - there just a few smaller tracts of land that have frontage on Deep Creek Lake or have access that can ever be developed in the future. Low inventory and continued demand should continue to fuel appreciation for lakefront and lake access homes in our market.