Limited Inventory, Limitless Possibilities
America’s luxury waterfront offers the finest amenities in a finite market.
By Stacey Staum
Limited inventory in America’s most renowned waterfront areas has caused prices to continue their upward climb. Thanks to improvements in the economy and a more stable real estate market, American coastlines continue promising sales trends, offering some of the most sought-after waterfront opportunities in the world.
The waterfront enclaves of New England have continued to be an exclusive destination for buyers and vacationers, with a rich history as a retreat and a very small inventory of homes for sale each season.
In recent months, waterfront properties in Nantucket have drawn buyers from as far away as London and Switzerland. According to Gary Winn, principal broker and owner of Maury People Sotheby’s International Realty in Nantucket, “Prices have been higher than ever before — even higher than they were at the height of the market in 2007. There’s only a handful of properties available on Nantucket and they all sell every year.”
Topping Winn’s list of current high-priced listings is a beautiful beachfront home offered for $21 million. Winn doesn’t expect much new building, as there isn’t available space for development in the area. As a result, Winn expects “prices to continue to rise because of a lack of inventory, with buyers coming from everywhere.”
Cape Cod’s proximity to Boston make waterfront homes in the area among the most sought-after in New England. Paul Grover, co-owner of Robert Paul Properties explains, “we just had the worst winter on record, so people are eager to have waterfront properties. The spring market started late for us, but since it started, agents have been very busy and buyers are scrambling to find properties.” So far this year, Grover already has closed on five houses in the $4.5 million to $6 million price range, which is only one sale short of his total for the whole year last year.
While Cape Cod has a year-round market and economy, Grover describes the waterfront market in Cape Cod as primarily summer retreat buyers. He shares, “waterfront luxury listings tend to be for the seasonal user. A lot of people in the financial, tech and pharmaceutical industries are generating a lot of wealth in Boston, which is renowned worldwide for the things being created there.” Cape Cod offers a very diverse community of individuals from an array of different industries, making it a wonderful place to live in terms of culture and amenities.
In Martha’s Vineyard, a finite number of properties become available for purchase every season. Bobbi Flake Reed, proprietor of Viewpoints Real Estate, explains, “Most of the buyers that I work with are children of long-standing owners or tenants, or have been tenants themselves. They know they want to be on the island and want to have a house to pass on to their children. Some of my buyers have waited years for the right property to come up for sale. Other buyers have visited the island for the first time, fallen in love with it, and moved forward with purchases.”
In terms of pricing, Reed explains, “The bulk of the sales were in Edgartown, one of the Vineyard’s six towns. Six of those sales were in excess of $10 million with a high of $22 million, and 10 of the sales were in excess of $5 million. A Vineyard Haven sale for $11 million was the highest recorded sale in that town.”
Martha’s Vineyard offers a one-of-a-kind experience for buyers. Reed describes life on Martha’s Vineyard as “far removed from the sometimes frenetic lifestyle off island. People choose an easier life where eating lobster rolls on the beach and watching a sunset can be just as appealing as a dinner at a 5-star restaurant. The Vineyard is a mecca for authors, poets, dancers, actors and educators. Children have a wonderful independence on the island with art, sailing and nature camps, sports activities and family beach days. The island has something for everyone and for every generation.”
As the premier West Coast location for waterfront properties, California continues upward sales trends with a limited inventory, which drives prices up significantly.
Randy Solakian of Coldwell Banker Previews International in Santa Barbara and Montecito, explains that the market in the area “is very finite and consequently commands premium pricing.” Since premium properties are in such short supply, homes in the area have sold for as much as $20 million in recent months. The Santa Barbara area offers what Solakian describes as “a really optimal combination of circumstances where you have year-round mild weather, an incredible natural beauty with the ocean and mountains and very clean air and foliage.”
Solakian continues, “There’s a depth of culture here, with arts, music, a business community and a social community that is, in some ways, superior to a big city.” The Santa Barbara and Montecito area is a particularly sought-after region because of its history as a Southern California landmark. Solakian elaborates, “There’s never going to be another community with so many amenities and with a 100-year history. Because of the history and the legacy families here, there’s a real passion, attachment, responsibility and accountability of residents who feel responsible for the health and well-being of the community.”
According to Solakian, high-profile residents with tremendous wealth bode well for the future of the market, as these individuals are not profoundly impacted by market fluctuations.
The Carmel and Pebble Beach areas also enjoy an active and secure market. Tim Allen of Coldwell Banker Del Monte Realty shares that while many of his second-home buyers come from the Silicon
Valley, buyers from across the country and around the world enjoy the unspoiled coastline, world-class golf and recreation.
Allen describes the markets in the area as offering a variety of listing prices: “In Carmel, which is the hub of the waterfront market, properties are in the $2 million to $4 million range and are the most liquid products in our inventory. Oceanfront properties in Carmel and Carmel Highlands run from $4 million and up, but Pebble Beach oceanfront will run from $17 million to $20 million, with some sales even higher than that.”
Allen feels “very positive about our market going forward. What’s so positive is the depth and breadth of the market because it’s sustainable. Unlike in the tech bubble, there’s real money out there, so the market will be healthy for the foreseeable future.”
The Southeast has shown marked increases after taking an especially hard hit following the market dive in 2006. Experts have noticed increased sales as the result of increased employment opportunities and new development.
The Georgia market has been picking up in recent months. According to Julie Barnett of Harry Norman Realtors, Georgia is a prime destination for luxury waterfront buyers. Barnett explains that the Lake Burton area is a popular retreat for second-home buyers in the Atlanta area, as well as Floridians looking to escape the heat, with listings as high as $5.9 million. She explains, “many people choose a lake home instead of a beach home because they can come for the weekend as opposed to traveling six hours from Atlanta to the beach.” She says, “The Appalachian Trail and Tallulah River pass through our area and 67 percent of the area is national forest, so the area isn’t overdeveloped.”
Florida continues to offer a wide variety of waterfront offerings at a range of prices. Nick Farinella of Coldwell Banker Residential Real Estate explains that improvements in the economy and business expansion have been driving sales in the Cocoa Beach area, stating, “We have major companies in the area, and we expect 3,000 new jobs in the next two to three years. Companies are hiring again, so we have a really good outlook over the next five years.” Waterfront properties in the Cocoa Beach area range from $460,000 to $2.5 million.
Lynne Koy, of Coldwell Banker Residential Real Estate describes her market in Sarasota/Manatee County as very active, with about 30 properties listed for over $1 million.
According to Koy, a wide demographic of individuals is buying, including baby boomers, Millennials, celebrities and international buyers. Home sales have improved both in volume and closing time; while high-end sales took about a year previously, closings are now occurring in 30-90 days. She shares three trends that she has noticed: “The total sales in Sarasota were the highest in the history of record keeping; the Sarasota/Manatee County area was recognized as having the highest number of cash transactions; and speculative building has returned, so there’s a lot of new development.” Koy is optimistic that these trends will continue in the coming years.