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Golf communities continue to wreck their handicaps, with homes losing value rather than remaining on par.
Eric Lucero
The velvet fairways designed by famous golf course architects and the patio views that encompass Pikes Peak to Longs Peak may be stunning, but times are undeniably tough for sellers of houses and homesites around the greens. Compared to other sectors of real estate, sales of expensive golf course properties are “very poor because the properties are not holding up in value,” says Robert August, president of Centennial-based S. Robert August & Company. “Nobody is doing well in the upper end. The only people doing well are those in the lower price points. Any buyer today is very lucky because there is a lot of property to pick over. Once you start tripping above $400,000 and $500,000, it takes longer to sell,” says August, whose company focuses on sales, marketing, and management strategies to real estate and related industries.
At Colorado Golf Club in Parker, for example, despite an outstanding Bill Coore– and Ben Crenshaw–designed course — recently ranked No. 2 on Golfweek’s list of Best Residential Golf Courses — sales have lagged since the initial volume in 2006 and 2007. Only 37 of the 170 home sites are unsold (at press time), but just 11 homes are owner occupied, four are under construction for owners, and seven spec homes are available, ranging from $2.7 to $4.195 million.
David Hutchinson, a managing partner at Colorado Golf Club, says he’s optimistic and believes the national exposure Colorado Golf Club will receive in May, when the club hosts the 71st Senior PGA Championship, will help. “The key to coming out of a difficult market in good shape is to maintain value, and that has been our feeling all along. Economies work in cycles, and we have certainly felt the effects of tight capital markets and a reduction in spending in high-end real estate. That said, confidence is returning to the market. We are seeing a dramatic rise in prospect activity and are optimistic about the year ahead.”
The Golf Club at Ravenna, where lots go from $350,000 to $900,000 and the homes range from $1.2 million to more than $5 million, is also struggling. Although the centerpiece is a Jay Morrish course that was listed among Golf Digest’s 2008 Top 10 Best New Private Courses, of the 243 homesites, only 77 have been sold. Twenty-six homes are under construction, and eight are occupied at this luxe club, which community manager and broker associate April Lynn describes as a resort lifestyle community focused around excellent service. Lynn says, “We’re not on fire, but we’ve got sales.” She adds that prices are holding because there are financial incentives for financing golf club memberships along with lenders and builders who can assist in financing homes.
Well-established communities in the mountains are holding steadier than along the Front Range, according to Chris Lankhorst, with Slifer Smith & Frampton Real Estate. He says that at Keystone Resort single-family homes at Elk Run and Elk Crossing on the Keystone River Golf Course range from $1.5 to $4.5 million. Keystone Ranch single-family homes on the course go from $895,000 to $2.48 million.
“You can find some dramatic deals now on properties in the multimillion-dollar range,” says Mark Samuelson of Denver-based marketing firm Samuelson & Associates. He notes that well-established golf course communities appear to be holding the best. “The economic swing took place in the late 1990s. The established golf course communities, like the Denver Country Club, already had their complements of homes built. Now, they are going through a new generation where older homes are being scraped and replaced or existing ones remodeled.”
Samuelson believes there’s been a paradigm shift. “People still want open space complete with walking trails and nature paths, and at the same time, they are not willing to pay a more exorbitant price for a golf course neighborhood.”
The bottom line: Investigate thoroughly before choosing your dream home alongside a fairway. August warns, “Be careful when looking at a golf course community. Make sure it can be stabilized economically because if the community becomes destabilized the golf course club itself becomes unstable. This puts a fear in the buying community, so the properties will be in trouble.”
Morrison-based freelance writer Lois Friedland loves to play golf and ski because these sports put her in some of the most beautiful places on earth.
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