Real estate sales surge in Glen Arbor

By Jacob Wheeler
Sun editor

It wasn’t quite a “road to Damascus” epiphany, but Rob Serbin did find the road to Little Traverse Inn last year. The Glen Arbor realtor finally sold the restaurant on M-22 for the second time in seven years, this time to Scotsman Graeme Leask, after it sat idle on the market for 18 months. The sale was emblematic of Serbin’s monster year, which saw his company’s net sales surge by 250 percent. Numerous realtors in the Glen Arbor area shared that good fortune.

The numbers for 2012 were astonishing. According to the Traverse Area Association of Realtors, a total of 383 residential listings sold last year around Leelanau County, compared to 262 listings in 2011 — an increase of nearly 50 percent. They ranged from a bank-owned condominium unit at Timberlee Hills for $26,000, to a home on Lake Leelanau, near Leland, that sold for $4 million after being listed on the market for several years at nearly $5 million. Last year saw 14 million-dollar sales, compared to nine in 2011. The surge included homes on the Glen Lakes, too, where realtors sold 16 properties, compared to 11 the previous year. Four of those 2012 sales reached seven-figure amounts.

Pam DePuy, a sales associate for the Martin Company since 2004, listed or sold eight of those 16 properties on the Glen Lakes, plus two more waterfront sales elsewhere, giving her a total of 10 — thus doubling her waterfront sales from 2011. Her boss, John Martin, dubbed her “Queen of the Lake” for her performance in 2012.

Serbin Real Estate posted $19 million in sales last year (covering properties in Leelanau, Benzie and Grand Traverse counties), compared to $7.5 million in 2011. The company’s most lucrative transaction in 2012 was on Big Glen Lake for just over $1.4 million. Meanwhile, LVR Realty’s sales increased by 30 percent between 2011 and 2012, and the company opened 2013 with four pending sales. Even cumulative Leelanau County vacant land sales surged from 86 in 2011 to 104 in 2012 — a 20-percent uptick.

“To turn it around like that was unbelievable,” said Rob Serbin, who completed one sale even though he never met the seller, and sold two more properties through word of mouth although he never officially listed them. “It was absolutely, without question, a fabulous year.”

What accounted for the surge in sales? Realtors agree: the spotlight cast on the area by the ABC “Good Morning America” TV show’s August 2011 “Most beautiful place in America” honor, and the steadily improving economy.

“I think people are realizing that the sky’s not gonna fall,” said Coldwell Banker realtor Mark Fisher. “Things got bad for a lot of people, so many just pulled back. But when it’s all said and done, people are still going to take vacations and look for retirement homes.”

And just as the economy showed signs of lurching forward, Leelanau County found itself broadcast on televisions across the country.

“Many view the Sleeping Bear Dunes National Lakeshore, and Glen Arbor specifically, to be a good place to make a solid, financial investment,” said Ranae Ihme. “The majority of those purchasing in this area are long-time renters and visitors who have always wanted to own here, and are now stepping up to do so with an even greater sense of security.”

But Ihme also credits smaller steps that locals have taken to make this a more livable and attractive community: “While the economy and GMA award have certainly assisted in our progress, Glen Arbor and its residents also need to be cited as a large part of this overall success. With such additions as the Sleeping Bear Heritage Trail, which is groomed for cross country skiing and snowshoeing, and the ice rink now open across from Art’s Tavern for skating and hockey, this little town is becoming an idyllic destination, regardless of the season, that many people want to call home.”

Real estate’s “new normal”

Real estate sales may have surged, but the market hasn’t returned to its glory years from the middle of the last decade, when realtors could count on $17,000 for each foot of frontage on the Glen Lakes or Lake Michigan. It may never again reach that pinnacle, forcing some realtors to embrace a “new normal”.

“I was alarmed the other day to see a sale on the north shore of Little Glen Lake for $420,000 for 140 feet of frontage,” admitted John Martin. “That was alarming because Day Forest Road lakefront properties ought to be $5,000 a frontage foot or more. I’m happy about the number of sales that happened last year, but there’s room for improvement. Prices right now are pretty static.

“We as realtors have become the jacks of all trades, and the masters of none: we sell everything, from waterfront, to vacant land, to commercial.”

While LVR Realty’s number of sales surged by 30 percent, the company didn’t sell anything last year for one million. In fact, said Ranae Ihme, prices of properties on the Glen Lakes have declined from the high $900s to the $700 thousands. LVR’s average sale price in 2012 was around $400-$500,000, leading her to conclude that “the steady increase (in the last couple years) was much more cautious and conservative than the boom in the late ’90s and early 2000s.”

“This is not the market of 2005 or ’06,” concurred Pam DePuy, who saw one property on the south shore of Little Glen Lake, that would have topped seven figures in 2005, sell last year for under a million. “If people are listing, it’s key that their property be listed at an appropriate price. Don’t let your expectations foreshadow the reality.”

You can’t compare 2013 with 2005, warned Rob Serbin: “Someone once said that if a property doesn’t sell, there’s something wrong with it or it’s overpriced. I can’t tell you how many times I’ve heard other realtors say, ‘I don’t want to give it away!’ But it’s the market price that determines things, and this isn’t 2005 any more.

“Sellers who may have had properties listed for the last few years finally got down to a price point where they were competitive. The nature of the market right now is driven by pent-up demand and more aggressive pricing.”

Long term effect

Will real estate prices remain relatively low? And how will the improving economy affect the market in coming years?

Ihme believes that homes finding buyers for significantly smaller prices than eight years ago will ultimately force the market to correct itself. “When the economy was really strong, there were usually about 30 listings in the area at a time,” she said. “When the market tanked, that numbered skyrocketed into the 80s. We’re now seeing a downward trend that’s nearing the 30s again. When that number stabilizes is when we’ll see an overall increase in property prices.”

The number of buyers looking to own homes in Leelanau County also figures to remain high. Serbin believes that the attention garnered by the “Good Morning” honor might not yet have borne fruit.

“Those people (who learned of the area on television) are still a year to five years (from buying here),” said Serbin. “They came to visit last summer, or the fall before. They’re gonna come back this year, or maybe for the first time. They’ve gotta warm up to the area first before they pull the trigger. So there could be a real trickle-down effect.”

As Mark Fisher points out, many of the lucrative properties sold in Leelanau County are secondary homes financed by wealthy Americans with discretionary income. With the recovery from the 2008 recession still young, the market for secondary homes is only now beginning to gather steam.

So Glen Arbor’s real estate market could continue to surge in 2013 and beyond. But the verdict is still out on whether it will ever reach 2005 prices again.