It is a great time to invest in Smith Mountain Lake! Of course you always hear the arguments:
“The stock market is better.”
“I am waiting for the market to drop.”
“I need a secure investment.”
Well to all of these concerns you could say, “Well the real estate that is overpriced has dropped – will it drop more, who knows?” The properties that are priced right are being snapped up, so be careful: don’t get run over by the investor crowd. And as far as the stock market goes, personally I have done better on waterfront real estate than in the stock market. (Maybe my choices of stocks are not so good, but neither is the market lately, and I am much better as an Architect and Realtor in choosing real estate products.)
Predictions
Here are some predictions to think about: The current US population of 292 million people (as of 2004) is expected to grow to 347 million people by the year 2030. By 2010, population expectations are as follows:
26 percent of the population will be age 18 and under
21 percent will range from the ages of 19 and 31
15 percent will range from 33 to 44
25 percent will range from 46 to 64
13 percent will be 65 and older.
By the year 2010, the migration trend and economic base analyses can be developed to estimate variations in the demand for real estate for any given region. Changes in location as well as living patterns determine where the growth will occur. The demand for real property and housing is related to these patterns. By 2010, the estimated population shifts look like this:
The Northeast will drop from 24 percent to 18 percent
The South will increase from 31 percent to 36 percent
The West will increase from 17 percent to 24 percent
The Midwest will drop from 28 percent to 22 percent.
These numbers are just estimates, but the theory is the same.
Supply is a function of demand, and the real estate market is often described as a buyers market or sellers market. Currently the market is a buyers market here at the lake; our supply is about 3 times the inventory, either on or off-water, than the inventory in 2005. The surprising element on the Bedford County side, where short-term rentals are allowed, is that the supply is still moving when priced right. The investors who know a good price are moving in and snapping them up.
If you are looking for an income producing property, then the following elements are critical for a good income candidate: location on the lake, water level, type of lot, septic system, views and amenities and condition of the home. Homes on the Bedford side can produce income from $15,000 gross to over $70,000 gross per year.
Income can be produced from any home with the correct amount of touches and renovation. As an owner of a rental management company as well, I know not only what the tenants are looking for but also what the buyers should be looking for (e.g., the topography is extremely important, with the water level being second).
Diversify
If you already own homes or land on the lake, then now is a great time to diversify your real estate portfolio. Yes, it should be diversified, not just with homes or land on the lake. A buyer should also look for qualities in condos or town homes for income purposes. Does it have a golf course? Is it a resort? If so, is it a rated resort? Does it have a hotel/condo resort feel? What are the amenities, such as a conference center? What other qualities does it have that might influence someone to rent there over another condo on the same lake?
Other Reasons to Invest in Smith Mountain Lake
Smith Mountain Lake also offers the following benefits: 3-4 hours drive to DC, 3 hours to Charlotte, 45 minutes to Roanoke or Lynchburg; it has its own private airport; the lake is controlled within 6 feet of a drop in water level (not like some of those other lakes that have had issues over the past years such as 20-foot drops); hiking, biking, golf, swimming, fishing, boating or sailing (large enough lake for regattas); proximity to restaurants & shopping, rivers, mountains, views, incredible life style, and wonderful Virginian hospitality.
Out of all my world-wide investments the ones on Smith Mountain Lake have always produced the best income and the best overall asset growth, in the short term and long term. I have never had any regrets about anything I have purchased here nor have my clients. You need to work with a good Realtor who knows this lake and investment criteria that best suits your style.
So go ahead, leap in now before the rates go up, the inventory drops again and the prices go up. Now is the best time ever to live your dream and start a life-long real estate investment portfolio.
