"Malaise in mansion sales"
 

"Malaise in mansion sales".....a top of the front page, article from yesterday's Saturday, January 17, www.Union Leader.com, 50-cent print edition. Talking about the local real estate market is a never ending topic that can either put you to sleep or peak your interest.

I was unable to make a working link because it requires an online subscription, so here's a few of the more interesting paragraphs.

"In the past 30 years, the lake has gone through a major transformation, with few small cottages left," (Russ) Thibeault said.
Many of the houses now for sale replaced small camps that were torn down to make "McMansions," Thibealt said.
'These are not locals who are buying anymore. They are East Coasters who have done very, very well," and the lake has become out of reach for the middle-class New Hampshire family, he said.
Thibeault said times have changed from the days in the 1970's when a plumber from Laconia could sock away enough to get a little camp by the shore of the lake. "Now, even the doctors are having a hard time," he said.
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Well...... I'm somewhat relieved to hear that coming from Mr Russ Thibeault of Applied Economic Research Associates in Laconia....as an out-of-work, truck driver, now I do not feel too bad just struggl'n along with my $8500. annual prop taxes.
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Waterfront land alone in many cases has more value than the building on it, Thibeault said.
......
Yes, in my case, it's 1/4 acre accessed for about 700k, and the cottage for about 100k.
....
This article has 32 paragraphs and it would be terrific if someone can figure out a way to post a link. It gets into the slowdown in sales and number of homes for sale and talks about one home on Governor's Island that pays $76,000 in property taxes.
.....
"There are at least 13 properties listed for sale on Governor's Island in Gilford."

"'But with recently enacted shoreland protections, it is hard for property owners to do as much with raw land, he said." (Marc Bourgeois)

"The market for Winnipesaukee has changed dramatically in 20 years, he said. Now it is an international market."
............
Besides the Shoreline Protection Act enacted July 1, 2007, there's also the 45-25 boat speed limit, and the decidedly cool & wet weather experienced in 2006, 2007 & 2008. For the past three years, the weather from May 15 to August 15 has been pretty drearie with prolonged cool & wet spells lasting for days and days. :(:(:(:rolleye1:

This link should work

Thanks Gatto Nero:

I found this portion of the story laughable:


"Those interested in selling are coming in because that early market is a good time," she said. "I think this market is not the market that is being hit as hard by the economy. ... The lake-fronts are going to hold their value."

Typical realtor nonsense! While many of these property owners have the wherewithal to hang onto these second and third homes, others don't. There have been lots of casualties in the high-end job market and some of the sellers of these homes will be in distress. Thus, there will be motivated sellers and prices on the waterfront will fall. With inventory as high as it is, the rules of supply and demand apply. Yes, there are some buyers who have incredible wealth and they will buy even in a terrible market, but these people aren't stupid and they will drive a hard bargain.

Now this is laughable
 

Bourgeois said that when he bought his home on Governor's Island, there was only an 8,000-square-foot house on the property.

He estimates his house is about 20,000 square feet now.

ONLY 8,000 S.F.?:laugh:

Thanks Gatto Nero. Even if I had the kind of money it takes to run a 20,000 square foot house I cannot wrap my mind around paying the town of Gilford $76,000 a year in property taxes !!! Though I'm sure Gilford just loves it.
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APRILIA RS50

Actually, $76,000 doesn't sound so bad. My house is listed at about 1,000 sq ft and I pay around $11,000 in taxes. If you follow that math he should be paying somewhere around $220,000. He's getting a bargain.

Lol, then we better let Gilford know that they are missing out on some cash:) I just had no idea there were homes on the lake this big, or that they were paying these kind of taxes. I had heard some folks were paying around $30,000.......but $76,000 & up, just wow.
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Vaporizer benefits

Marc Bourgeois - I believe originally from Atkinson, NH area. He is the exception to the local/native who can afford to be on the lake.

I understand he made his money in a .com business then when he saw changes coming/got an offer you can't refuse so he sold and opened his current company, including buying the competition. He earned his $$ by being a good entrepreneur.

A Very Smart Guy.

So he can afford his life style... including the property taxes but he worked for and earned it.

I know some who don't like him....could be envy.:D

BTW I also understand he showed his parents how to make $$ in the .com craze and they did.

Just Sold:

That certainly makes sense. I was trying to figure out how someone in the equipment rental business could afford such a home.

Oh don't get me wrong. I don't bear Marc any ill will, kudoos to him for his being in and out of the right thing at the right time. I just thought his, its only 8,000 square feet was funny.

Thanks for the link, Gatto Nero.

No, it's all part of their sales training for a real estate sales person to boost the market, and never ever bad mouth it, and the Union Leader, like all newspapers has plenty of real estate advertisers to whom it is responsible.

There's an unusual property for sale at the bottom of Meredith Bay....very large lot...very impressive stone & iron fence....a new boat house....and the proposed mansion never got built.

My question: will the sub prime, mortgage meltdown drive down the price offers and the final price?

How about the weather for the past three summers? Think President Nicholas Sarkozy will return after experiencing two weeks of rain in Tuftonboro in 2006?

Bad information about Marc B.
 

Marc B. had nothing to do with a dot.com business and he didn't show his father how to make money at it.

They owned and worked together at a company that they decided to sell. Marc decided to continue working, thus the MB Tractor business. He has done a great job and expanded the business. He works non-stop, usually 6 or 7 days a week.

Don't believe everything you hear! See how rumors get started?

What does he own? What's the "MB Tractor business?"

...seem to have a foggy memory of his dad selling a southern NH auto parts maker, American Axle & Driveshaft, or some name, for big big money, like 50 million or something. Then, two years later, the new owner, old company, and NH employees all got to go bankrupt together, and close the axle company. Not a happy situation!

...hey Marc, look'n to hire a newbie 18-wheeler truck driver:D?

MB Tractor is a local tractor dealer
 

I did not realize Marc was the "MB" behind it.

www.mbtractor.com

I understand he made his money in a business rebuilding/reconditioning auto parts.

Less, if you're angling to drive down the value of your property thinking that your taxes will be reduced, it ain't gonna work. Most likely what will happen is the value of all properties will be reduced, but the levy, the amount of money collected will remain the same or more likely increase. They just adjust the tax rate to compensate. You'll end up with a property valued at less and a bigger tax bill. Nice try though.......

[QUOTE=fatlazyless;87435]Thanks for the link, Gatto Nero.

There's an unusual property for sale at the bottom of Meredith Bay....very large lot...very impressive stone & iron fence....a new boat house....and the proposed mansion never got built.



QUOTE]

I know the place you are talking about less. As I recall he spends a million or so on the stone walls first!

It was 2 weeks of gorgeous weather, in Wolfeboro, in 2007. Only reason I remember is that I happened to be vacationing on the lake the same two weeks and had a great time.

Yes MB is Marc Bourgeois.The dot com is a new one on me.The family owned a large auto parts wholesale business.

Also the French President vacationed in Wolfeboro not Tuftonboro and I agree the weather was great the whole time.

Oh well, I never let the reality effect my biases, but the weather really has taken a turn to the cool & wet side for the past three seasons. Starting in 2009, here's look'n for a change ito some warmer and less rainy weather.

Any real estate sales people out there...do buyers of one to two million dollar, waterfront homes typically pay all cash? Perhaps they are just waiting for some time to unwind, and do not want to purchase a house with a slowly falling value? What's the effect of the stock market's DJIA going from 14,000 to 8,000 on the waterfront homes market?

What's the effect of the stock market's DJIA going from 14,000 to 8,000 on the waterfront homes market?[/QUOTE]

I'll give you five guesses and the first four don't count!

A 20,000 sq/ft house!
 

Man am I glad that I don't own a 20,000 ft house. Think agout it. You would spend all of your free time washing windows, cleaning bathrooms and doing the lawn.

Nope. Give me the simple life!

Misty Blue

I'll give you five guesses and the first four don't count![/QUOTE]

Lol, I agree.....it's over. BTW look for the Dow to bottom out at about 5,000:(
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Arizona dispensary

20,000 sq ft. house
 

Misty Blue,
I am assuming that is a joke! You don't really think Marc and Heidi wash their own windows, mow their own grass or clean their own bathrooms? Most of their house does not get much, if any use, unless they have guests. I have been to their home. It is huge and very nice. Although it is 20,000 sq feet, oddly enough it still feels very homey.

Happy waterfront owner
 

I own a large lakefront property that I bought about a year ago. 30% below original top of the market asking price, but surely I've "lost" money since the purchase. It was an all cash deal...as I bet most high end vacation homes are. While I'm not thrilled about the decline in value, I doubt the decline has been as signficant as where the money would have been had it been in the market (where I'm down 40-60%). That's where it would have been had I not bought the house. So is my $2 million house now worth only $1 million? Doubt it. Even if it is I have no plan to sell at such a vulnerable moment. (original asking price was $3 million). As for my $22,000/year in taxes to Alton...well...it's about 1% of the value of the house. That's about what you pay a manager of an equity mutual fund, yet I get to deduct taxes (not management fees) from my taxes. So overall I'm pretty happy. I'm a somewhat wealthy "masshole" new to the region and one of the things I love about the area is that there seems to be very little resentment (other than the occasional nasty anonymous posting) re people like me. People mind their own business. Overall, the Lakes Region has a life of its own, and thus there is generally very little flack directed to outsiders. That is NOT the case in places like Martha's Vineyard, where the tension is quite open. Very happy about the experience so far on Winnipesaukee. A great area.

Just curious what you mean by "someone like me" - other than a somewhat wealthy "masshole". I agree that most people mind their own business. Personally, I think of minding my own business as worrying less about specifically what someone paid for their home, and in all cases, as not divulging what I paid for my house and other personal financial information on a public forum. Just a thought.

It is a gamble
 

There is a fair chance that within three short years, the economy will be back on a steady keel and housing prices will go back up again. There are a lot of people preparing for an eventual turn-around, including buying distressed priced homes. If and when a turn around comes, those that gambled on a good future will be our new neighbors.

Welcome to the forum nvmbr9. I hope you can be a good sounding board for questions that we folk who cannot afford to plunk down $2mm for a vacation home might have when a broad based opinion of the ecomomics of an issue is needed.

public forum
 

This is an anonymous public forum, where reciting how much I paid for a house should not be considered an insult unless people are very thin skinned. I thought people might find a real owner of a real property interesting, and why owning a property that might be declining in value isn't the end of civilization. There are people out there who earned enough to buy expensive homes on Lake Winnnipesaukee. Someday it might be you, or your son or daugher. And that's a bad thing? And I did it the old fashion way, I earned it through hard work. It's a big lake. One of the things I love about it is that there are small shacks, and huge mansions, and everything in between. And it has always been that way, despite journalistic accounts of recent construction. The American Dream...and I chose to spend some of it on the shores of a beautiful lake in NH.

Welcome
 

And I am hoping this will be me someday honest, I am working to that point as well, as age 28 I have a lot of goals, but I already have a nice little cottage on the lake, a boat and a jet ski, a home and couple of properties, would I say I am rich, now I jsut point to the 3 mortgages I have and day care bills and all that, and to those that say well isn;t that nice, all I say is well you can pay the mortgage to if you choose to and give up other things like my wife and I do. And Trust me IF the rents don't even come in it will be a very short time before I have to sell everything
Do not be asshamed you have money, beashamed if you do not enjoy your money, especially if you worked for it yourself

I think you may have taken my comment incorrectly, please do not. It was a sincere welcome and a hope that you could bring a different perspective to the mix of opinions. Although many of us are owners of lakefront property, there are few I would imagine that would not be owners if not for inheritance or a plain old mortgage. Hence your uniqueness.:D

Thanks
 

Thank you for welcome. Using a mortgage for high end properties is kinda crazy. Few would do that, in my opinion, because no one has that kind of cash flow on a monthly basis. That said, I think one of the reasons I got my price was the seller had a large amount of debt against the property, including a home equity line that was maxed out. You will soon know how many properties have that profile because they will soon be for sale, or foreclosed upon. Have no clue if it's a lot or a little, but I suspect the latter. I can't imagine living that way, nor could my wife. We couldn't enjoy it. My purchase arose from the sale of shares of my company at 45, and those shares are today 17. You can see therefore how happy I am to lose some money in a lake house, because the alternative would have been to not have sold the shares, and the money would be down way way more. Plus I get to use the lake house, which I love. In fact, I'm getting in my car right now to drive up there. I love it there in winter...almost better than summer. I grew up in Ohio with wide open spaces. The lake frozen is the widest most open space I've ever encountered. Plus the skiing is supposed to be great this weekend.

You know nvmbr9, I would have agreed with you that most people pay cash for their high end houses. However, I was discussing that very subject with a realtor about a year ago and he told me that it is not true, that most people DO finance them. Maybe there are other realtors on here who would disagree with that, and I think it would be interesting to hear from them.
I am with you though. We have a high end house and I would hate to have a mortgage on it.

cash or carry
 

I think I understand about the cash purchase and monthly cash flow. As you can see it was a long time ago that Pineedles was built. Total cost of home, property, and a later built wharf was approx. $3k. It was bought for cash, and..... it was in 1892 and is worth $1.1M today. So, I am satisfied with the return, as are most of my aunts and uncles and cousins because of; Great swimming, skiing (snow and water), hiking, exploring, cooking, climbing (Chocorah, Most of the Presidential Range, Washington (all ways but CogRailway(it scares us to death) LOL, Red Hill). You are a good sport nv, so hang around a bit longer, and come to our next Forum Fest, you'll find alot of real nice people on the Winnipesaukee.com forum.

Financing High Priced Lake Homes
 

I am a Buyers Broker, my experience on the Lake is the higher the price of the home the more likely that it is a CASH transaction

Always wanted !
 

Since teen age years and day trips to wayer ski and use the jump in Paugus Bay I wanted to be there. Now I do not see it as a legacy to my family! Taxes and costs. JMOO

I'm not surprised to hear the high end real-estate market is not yet effected by the downturn in the overall economy. Why would it? The majority of those that can afford those places are into them for cash as has been mentioned on here and I've heard the same from other sources as well. Even if they do take out a mortgage it's not becuase they have to it's because they think they can unlock some of that money and put it to further use at the expense of the bank. I know this may sound really bad but let's face it, the folks buying the high end properties are much smarter than the poor people suckered into high risk loans and I would bet that most did not enter into a second home purchase not fully planning out if they could afford it or not. They certainly did not get rich by being financially ignorant. Plus since they have cash in hand they could care less what mortgage rates are or if they can get a loan since they don't need it. Therefore they are not in as much risk of loosing on thier property unless over the long haul they have to part with it due to the re-occuring costs of hanging on to it. The current and near term political climate is hostile to anyone who is sitting on any kind of substantial wealth and no doubt there will be concerted efforts to tax the living bleep out of what you got.

...here & there
 

105 Cattle Landing Rd, Meredith 1.60 acres, taxes $3629/yr, 3 bed cape built 2001, assessed $332,700., for sale for $169,900., by Federal National Mortgage, (acquired 9/2008),, non-waterfront
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22 Cattle Landing Rd, Meredith, taxes $63,000/yr, 5 bed condominium house on about 1 acre, for sale for $4,250,000 since 2006 by builder, waterfront
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Located just up the street from one another. Two very different properties. If 105 Cattle Landing ever gets sold, how does that effect the price of 22 Cattle Landing, which has been up for sale since summer 2006? Will the big money value at #22 get a 50% price assessment haircut? :):rolleye1::)

The one problem with the paying cash argument is if you can get more return on your money than the interest of the loan,it makes no sense to pay cash.I know I'm getting 10% on mine and loans are around 5% so paying cash is losing money.

Unless your money was in the market over the past few months.

And where right now can you get a guaranteed 10% return on your money??... 2nd home mortgages (which most lake houses are) are currently in excess of 7%. In my opinion paying off debt with a guaranteed return of 7% makes a lot of sense right now particularly in this extremely volatile market!

Dan

Another wrinkle in the cash/mortgage decision is that in Florida a primary residence cannot be taken as part of a legal judgment so that a physician may put cash into a house to protect it in the event of a disastrous malpractice decision. I doubt this is applicable to NH.

Where do you think rich folks got the cash in the past to purchase multi-million dollar lake property? How about stock options, corporate buyouts and bonuses? Hmmm, maybe there will be less of those events and cash transactions for second homes on Winnipesaukee will fall along with prices?

"Differnt" Strokes...
 

How about corporate bailouts? :eek:

If they ever finish this $4 million speculation-built McMansion (below), the neighbors will be looking at a major raise in property taxes. :(

Of the dozens of residences out there, they'll be only the second owners to actually live year-round in the area. (Direct north-wind exposure, remote, infrequently plowed access, difficult access-even in summer).

There's a reason everyone else just "summers" in that locale. :look:

second, you forgot to add those hardworking business people who were successful.

Yes hardworking business people who made intelligent decicisons when it came to their stock options and bonuses. If the tax base from these properties falls who will be stuck making up the difference? I think I know!