By: Mike Kennedy mkennedy@railey.com 301-616-6106 January 27th, 2009 Category: Deep Creek Lake Market Update, Deep Creek Lake Real Estate

Garrett County’s Planning and Land Development staff recently released their annual report that shows a continued declining trend in the amount of new subdivisions and approved building lots. However, the report does not break out the subdivisions and lots in the Deep Creek Lake zoning watershed - but instead lumps all Garrett County land statistics together. However, it’s a safe assumption that a majority of these statistics are in the general Deep Creek Lake area.

Subdivisions and Lots Down

The total number of approved new building lots in 2008 was 85 - this is down from a peak of 382 approved building lots in 2005. The Deep Creek Lake & Garrett County real estate market has experienced a sharp increase in the total number of available lake area building lots for sale over the past few years - mostly owned by developers, speculators, and flippers who purchased and developed a few years ago.  Hopefully this decrease in applications and new subdivisions will take pressure off of rising inventory.  

High Inventory of Lake Area Lots

If you are a prospective lot or land buyer - you currently have a tremendous amount of choice in the general Deep Creek Lake area - these are home sites that are NOT lakefront, have NO lake access, and NO lake views. As of today, our MLS is showing 111 of these types of lots for sale - with a majority of them priced in the $89,000-$139,000 range. For the past two years, the total number of similar lots on the market was in the 150 range - so the inventory has come down some over the past year.  This number does include about 17 home sites atop Wisp Ski Resort - some with slope access.

Low Inventory of Lakefront and Lake Access Lots

However, the number of choices and inventory levels decrease greatly as you get closer to Deep Creek Lake.  Only 12 true lakefront lots are currently on the market - ranging in price from $400,000 to $1,495,000 in Holy Cross. And only 14 lake access lots with deeded boat slips are currently for sale - ranging in price from $165,000 to $525,000. These lower inventory levels on the lake should continue well into the future as 63 of the 65 miles of shoreline around Deep Creek have already been developed.  The only larger parcels yet undeveloped are Thousand Acres, Pergin Farm, and a small area between Holy Cross and the end of Boy Scout Road. Contact us if you are in the market for a lot or thinking about buying some land - the lot and land buying process can be a very tricky in this area - there are many factors that need to be considered and evaluated.

By: Mike Kennedy mkennedy@railey.com 301-616-6106 January 15th, 2009 Category: Deep Creek Lake Buyer Info, Deep Creek Lake Market Update, Deep Creek Lake Real Estate, Wisp Real Estate

The Deep Creek Lake area real estate market continued to show steady performance in 2008. As you can see from the chart below the total of number of sales continued to decline but the average sold price continued to go up.  All data was obtained from our local mls and these are residential properties only - consisting of lakefront, lake access, Wisp Ski Resort, and lake area homes, condos, townhomes.

Why does the average sold price keep going up in this market? This certainly goes against conventional thinking when most other real markets are showing declining values. The reason is probably due to the nature and financial make-up of the majority of sellers and property owners we currently have in the Deep Creek area. Most of our sellers “want” to sell but don’t necessarily “need” to sell.  What we hear most when approached to help an owner sell their Deep Creek Lake property is “We don’t use the property that much anymore. We can’t justify owning it anymore.” That is a “want” but not “need” type of motivation level. In fact, the motivation level of most sellers in our market is probably much lower when compared to other markets.  Every seller has their own unique reason for selling and, yes, there are distress selling situations in our area such as divorces, property owners in financial trouble, short sales, and foreclosures - but those are few and far between in this market.  Maybe we’ll see more distress situations in 2009 that could put downward pressure on values? We certainly saw more distress situations in 2008 than in 2007- but those types of transactions still make up just a small part of our entire market.

Why does the number of sales continue to decline? Like most other real estate markets across the country  it’s a large collection of many things  - it’s much harder to get a bank loan now, the equity in many people’s primary residence has probably gone done in value, job losses, and it was finally revealed that the country is in a recession causing much fear and anxiety.  Our resort market certainly isn’t immune to these types of things. We certainly lost those buyers who got caught up in the real estate boom earlier this decade, the flippers, speculators, and those that may have been stretching themselves financially to buy a second home. Not many of those people are around anymore looking to buy. The types of loans those buyers were using to purchase a few years have dried up as well and are all but gone - probably for good.  But what our market hasn’t lost is the buyer who wants to purchase a vacation or second home and has the financial means to do so. Those buyers are still very much around.

Is there a value correction coming to Deep Creek Lake? No one can predict the future one way or the other. But the numbers have shown that demand has decreased as evidenced by fewer sales - but average sold prices have gone up. How many other real estate markets can say this over the past two years!?!?

If you are looking for advice on what to do in this current market - that’s easy. If you are a potential buyer - take your time, study the market, find out what is currently available, how much has sold, what are current inventory levels compared to the past, ask about any new factors or developments  that could affect your value should you need to sell, ask many, many questions!  -  find a knowledgeable, experienced real estate agent who can provide this information and one who can educate you about the Deep Creek Lake market. Then once you find a property you may want to purchase - have that real agent show you similar properties that have sold and find out when they sold and for how much they sold for. A good real agent should be able to educate you enough and provide the necessary information for you to make an informed decision! When you are ready, give us a call, or shoot us an e-mail - we have the most knowledgeable and experienced real estate agents in the Deep Creek Lake area.

By: Mike Kennedy mkennedy@railey.com 301-616-6106 January 7th, 2009 Category: Deep Creek Lake Buyer Info, Deep Creek Lake Real Estate, News

DNR Policy Change To Impact Deep Creek Lakefront Property Owners

There has been a change in DNR’s policy with regard to how older “grandfathered” improvements on the Deep Creek Lake buffer strip will be recognized. Up until now, any improvement - such as a walkway, stone path, pavilion, or shed - that existed with Penelec’s or DNR’s approval prior to DNR’s original management of the lake in 1980, or before DNR’s first set of regulations in 1986, did not require a permit. The permits were intended for new improvements only and DNR would simply document the older grandfathered improvement in their site inspection reports.

DNR has not required permits for these improvements for 28 years. DNR Lake Manager Carolyn Mathews has informed the Garrett County Board of Realtors that they are reinterpreting the regulation and are requiring property owners to apply for a Special Permit when DNR identifies a grandfathered improvement during a site inspection. DNR also reserves the right to require the removal or significant alterations to the grandfathered improvement and the permitting process provides the method and leverage to do so.

What does this mean to lakefront homeowners or those looking to buy lakefront real estate? Quite simply, if you have an existing improvement on the buffer strip and don’t have a permit - at some point DNR will approach you to apply for a permit without any guarantees they will approve it - even if it is “grandfathered.” And for those looking at buying lakefront property - pay very close attention to what you see down by the lakefront. If there is an improvement, such as a deck or shed, make sure the current owner can provide documentation that the improvement has been approved along with a special permit. If the owner can’t provide a current permit, make them go thru the permitting process with DNR. There are examples where DNR has conducted a buffer strip inspection, either at the request of the property owner, the buyer, or a Realtor® prior to closing and then required significant modifications to or the removal of the formerly grandfathered improvement. Depending on the terms of the contract of sale, and the timing of DNR’s inspection, this might impact your closing by introducing unexpected DNR permit issues and the costs of complying with DNR’s orders.

(Post written in conjunction with Paul Durham)

By: Mike Kennedy mkennedy@railey.com 301-616-6106 January 6th, 2009 Category: Garrett County News, News

Coming soon to Oakland, Maryland is a brand new Walgreens drug store scheduled to open in the summer of 2009. For those of you that don’t know Oakland is the county seat of Garrett County Maryland and is located about 9 miles south of Deep Creek Lake.  Even though it is not yet built, this Walgreens is currently for sale to potential investors who may be looking for cash flow or to complete a 1031 tax deferred exchange. Here is the most recent information packet we have. Please contact us if you are interested in this investment opportunity or any others in the Garrett County or Deep Creek Lake areas.

Walgreens Oakland (PDF)

The developer who is building this particular Walgreens had purchased 3 parcels of real estate last year which basically comprised an entire block of land near downtown Oakland.  As a result, 2 businesses and one apartment building were recently razed to make way for the new drug store that will go head to head with CVS - which is located directly across Garrett Highway. The two businesses that are now gone are the Oaklee Dairy and Laundromat - which were both long time fixtures as you approached Oakland from Deep Creek. The Oaklee Dairy was more commonly referred to as “the custard stand” by most locals.

It’s hard to imagine that a small town such as Oakland and Mountain Lake Park already has a Wal-Mart, Lowes, and CVS - and now has a Walgreens on the way that will employ 25 to 30 people.

In other Garrett County commercial real estate news are rumors that both Wendy’s and Outback Steak House are exploring the outparcels in front of the new Lowes as possible sites along of Rt. 219. However, both rumors are unsubstantiated at this point.

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