Private Club Waitlists: Five Tips to Manage the Process for your Real Estate Buyer
It’s here, an outright surge in demand for club communities and golf membership! In a recent study released from Club Benchmarking, 71% of clubs who have an initiation fee of $90,000 (or more), have reached a waitlist. However, the national average for a private club membership is $40,000. Of those clubs, 44% have reached a waitlist which is up 25% from May 2020.
Experts within the industry believe we will continue to see a strong demand for at least the next 12-18 months, barring any major economic event which could disrupt the golf industry. Golf Life Navigators agrees as web traffic and buyer engagement continues to break historic records.
So, how do we manage both ends of the spectrum as agents? Anyone in the real estate industry knows it is problematic when you have a golf buyer who would like to make a move on a home but hesitant to commit due to the unavailability of a club membership – and access to the golf course.
We conducted a little research and are happy to share a few positive solutions that you can provide to your buyer:
Tip One: The average attrition rate for clubs across the country is about 10%. This means 10% of the membership will turn over year-to-year. That said, the club likely knows of an estimated timeframe of limbo for a waitlist member. Most clubs anticipate a 4-8 month wait. With many southbound buyers being seasonal, the timing could align nicely. Our suggestion: Meet with the membership directors of the clubs you are selling and see if they have an estimated time of conversion from waitlist to golf member.
Tip Two: Many buyers are still in “snow-bird” mode their first couple of years as they prepare to exit the work force. Most clubs will provide access to the club’s golf and amenities while a future member sits on the waitlist. Our suggestion: Gather the specifics about access as a “waitlist member.” The membership director should have this intel readily on hand. Don’t be surprised if it may have changed recently due to high volumes of play this year from the current members. We suggest to check-in once a month.
Tip Three: You might be surprised at the number of clubs who have programming in place for any new home buyer who purchases a home that was owned by a golf member of the club. If you can locate one of these sellers, often times you will jump to the top of the waitlist and be a full golf member in no-time. This intel is likely not online, although we have seen some MLS notes disclose it. Our suggestion: Every time you inquire about a home, ask the listing agent if the seller is a current member of the club and if there are any special circumstances in place for your buyer to leapfrog the waitlist.
Tip Four: Bundled Communities. There is no better way to gain instant access to the club than to purchase a home in a bundled community, where a club membership is attached to the home deed. The caveat is, golf availability can be limited during the peak season months. So, if your buyer envisions playing golf 4-5 days a week then a bundled environment might not be the right fit. Remember in bundled communities, if there are 800 homes, that means there could be up to 1,600 members (w/spouses). Our suggestion: Investigate this option but be very clear to your buyer of what to expect. For many buyers, this will be perfectly acceptable and a nice solution to expedite the purchase.
Tip Five: Executing a Two-Phase purchase plan. If your client is 100% all-in on one particular club, but there is little real estate inventory available – and a lengthy waitlist – perhaps there is another direction to consider. We’re seeing it happen a lot in Southwest Florida, buyers are moving forward to purchase a smaller home or condo in a neighboring community. The intent is to wait-out the higher pricing within the real estate market while also joining the clubs waitlist so they can at least use the facilities and meet their future friends. When the time is right, they sell their current property and purchase a home in their intended club community. Our Suggestion: Consider a “bundled community” for your buyer if they want to take this approach. Bundled communities generally have a number of lower-priced condominiums and your buyer will have the ability to play golf – as mentioned above. In addition, the resale value should still be strong as the demand for golf will likely still be extremely high. Although this approach might not have been in the cards originally, it could be a nice solution that satisfies your golf buyer and creates multiple sales opportunities for you and your brokerage.
What can we take away from the current state of the industry? Golf is in high demand and it may make life a bit harder for you as a real estate agent. But, there are always solutions and alternative suggestions that can help you close the deal and find your buyer that perfect setting between golf and home.
-Jason Becker, CEO
Golf Life Navigators