COVID's sea change raises demand for water access

LACONIA — In 2019, Ray and Deborah Varga traded up to a single family-home with lakefront access and are glad they did – before COVID jacked prices through the roof.

After selling their longtime home in Newburyport, Massachusetts, they bought a primary residence in Southdown Shores for $475,000, which is now worth $700,000 or more, according to Zillow, an online real estate sales platform – a jump of 44% in two years. That’s an eye-widener even to real estate agents used to rising prices amid rocketing demand.

For the Vargas, who are in their late 50s and early 60s, it was a triple play: a place for Deborah to work remotely as a portfolio manager in Boston, an investment to retire in, and a toehold on quality of life that’s hard to duplicate elsewhere.

The Vargas keep a condo in Boston for Deborah to work three days at her company’s office. Friday through Monday she’s in Laconia, for all four seasons of the year. Ray considers himself semi-retired after selling his air freight logistics business at Logan Airport.

“Since COVID, everybody’s moving up here,” said Ray, who grew up in New Jersey and first bought a condominium here in 2003 for $225,000, which he sold for $280,000 in 2019. “The first time I saw Lake Winnipesaukee, I called my mom up and said, ‘I know where I’m going to have a second home.’ It’s just beautiful. I have the golf course. I have the lake. I have the boat. I have Gunstock. I can go out and go out to Lowe’s and Wal-Mart if I want.”

When she doesn’t need to drive, a Concord Coach express bus takes Deborah from Tilton to South Station for $21, or $25 from Meredith. Now, without cars garaged in East Boston, their auto insurance has dropped by over 75%, said Ray.

In many ways, the Vargas are part of the latest wave of Northeast urban and suburban expatriates who have come to the Lakes Region for open space, recreation and access to lakes – particularly Winnipesaukee, New Hampshire’s biggest lake.

With property taxes for private waterfront floating as high as $40,000 a year, a second home in a community with shared access seems like bargain, said Ray, with taxes less than $10,000.

There are many waiting in line to buy, according to Lakes Region agents who sell waterfront and water-access homes. Open houses draw as many as 20 people, with most shoppers primed to offer above asking price and able to pay cash. Deals can be accepted the same day.

The Vargas drove up to look at their house on Good Friday, made an offer the following day that was accepted later that afternoon. They sold their three-bedroom condo in Southdown within one day of listing it. That was before COVID ramped up prices and the pace of sales.

“People that have the money will pay anything just to be up here,” Varga said. 

Surprising, too, are the demographics of people who purchasing waterfront here.  The Lakes Region is still a magnet for active retirees and vacationers from Greater Boston, and to a lesser extent, business owners and professionals who can grow self-sustaining careers here. Now COVID has cemented hybrid or remote work schedules for a broad landscape of people – and that means more buyers.

According to real estate agents, many recent transplants are in the tech or bio-tech field, with high-paying consulting jobs that give them flexibility in location and time. Some have sold start-ups, or continue to work as highly paid executives. Attorneys and financial services and sales executives are working remotely. Teleconferencing has made it possible for doctors to dial in to check on patients locally and and confer with colleagues in other states.

For businesses where at-home workers have proven productive during COVID, telecommuting has cut down on real estate and operations costs, including parking, utilities and rents.

Frank Roche, president of Roche Realty Group, said New Hampshire’s quadruple magnet of no sales, capital gains, inheritance or state income tax continue to make this state attractive for people who can live here part or all of the week. Some are keeping city homes elsewhere, said Kevin Shaw, an associate broker at Roche Realty Group.

The lake is a lifestyle draw. That’s reflected in prices. According the New Hampshire Association of Real Estate, which analyzes data from the Northern New England Real Estate Network, the median price for single family homes on lakes statewide has risen by 70% since 2015. For lakefront homes in towns that border Lake Winnipesaukee, the median price has risen by 83%. 

Much of that growth has occurred recently. Since 2019, the median price of single family waterfront homes in Wolfeboro, Gilford, Moultonborough, Laconia, Alton and Meredith has risen by 43.6%, according to NHAR. In the past year alone, that number jumped by roughly 25%.

Since the pandemic in March 2020, there’s been a “tremendous increase” in interest in waterfront and water access, said Shaw. “A lot of people are not in the office. They’d rather work up her at the lake and mountains than down in the city. We used to say we’re becoming a retirement state. Now, we are a retirement state. We’re talking about people aged 55 to 65 who want to be out at the lake. We’re also seeing a lot of younger families.” Buyers in their 30s and 40s are not uncommon.

“The amount of disposable income that people are coming into town with continues to blow my mind,” said Shaw, who grew up in Gilford and used to coach kids’ soccer there. “They’re not just buying real estate. They’re coming in to buy boats, ski passes and ski packages. It’s really amazing. I’ll have someone who closes on a condo then goes right to the marina to talk boats.”

With the shortage of waterfront houses and sticker-shock prices on Winnipesaukee, many are turning to smaller lakes or communities with shared water frontage in Laconia, Gilford and Meredith, with shared amenities and lower holding costs, according to real estate agents.

“There’s enough to do. If you’re a weekender, you can pick up a bag of groceries and not leave all weekend unless you go somewhere by boat,” said Shaw.

Older owners of single family waterfront homes, who previously wanted to downsize or relocate to warmer climates, are hanging onto lakefront cottages and retreats because grown children and grandchildren are returning to use them and staying longer, including during COVID.

Shaw said that up until two years ago, most lakefront buyers were coming from Southern New Hampshire and greater Boston, including the North Shore. Now the predominant market has expanded to include second and primary home buyers from Rhode Island, Connecticut and New York who are opting for New Hampshire over neighboring states. Since COVID curtailed foreign and domestic travel, owning a vacation home on or near Lake Winnipesaukee and Gunstock became a doable, attractive alternative.

“Here you have boating, hiking, skiing and golf. You could get outside to enjoy it,” said Shaw.

Buyers are still coming up from Southern New Hampshire.

Julie and Derek Cesati of Windham bought a single-family home in the Long Bay condominium in July 2021 after looking since 2020 for a second home on the lake. Julie grew up in Gilford, competed on a ski team, and hoped her children ages 6 and 8 could grow up with the lifetime winter sport. Her husband learned to ski last year, during COVID’s pandemic of shutdowns. They bought a boat and family ski passes to use on weekends and during school vacations. The family lives in Windham during the week even though Derek works remotely in sales so the children can continue school there.

It wasn’t easy to find or buy in the Lakes Region post-COVID, Julie said. The couple first looked at a house near Gunstock, which they were poised to purchase. Without any waterfront, it sold for $150,000 above the asking price, she said.

The started looking at places with a walkable, community shoreline, which required little driving.

Between the swimming beach and playgrounds, as well as family movie nights and crafts, “there’s tons of stuff for the kids to do around here,” she said. And Julie has friends from growing up nearby.