Agent Insights Property Market Insights

Traverse City: The Resort Destination to Invest in for Every Season

A top local brokerage gives us a snapshot of the luxury real estate market in Northern Michigan, including the incredible lifestyle on offer, market trends to look out for, and advice on investment opportunities

Situated on Lake Michigan’s Grand Traverse Bay, Traverse City has much to offer: local wineries, excellent restaurants, a thriving art scene, and an enviably active lifestyle year-round. It’s also notable for the range of homebuyers its real estate market attracts. Long named one of the best cities in America in which to retire—partly due to the fact that Michigan does not have estate or inheritance tax, and there is a state tax break on pension income—it’s also home to more millennial millionaires than any other zip code in the United States.

Vinyeards in Old Mission Peninusla with view of Lake Michigan
A scenic drive through cherry orchards surrounding Traverse City leads to the area’s Old Mission Peninsula Wine Trail, which offers a tour through 10 vineyards and tastings of the state’s best wines. Image: Getty Images

It’s a facet of the city that Dr. Jay Higdon, co-owner of Autograph, is well acquainted with. “Our market attracts a lot of people approaching retirement age,” he says, “It’s always been a drawcard of the area that retirees can spend great summers here.” But, he notes, in recent years the city has seen a greater mix of homeowners and is appealing to a younger demographic, with different property needs.

“We’ve found that millennials are moving here for the incredible, active lifestyle, but don’t necessarily want the same 8,000 sq ft (743 sq m) house that their parents might have bought. They want something contemporary; smaller scale, but still luxury.”

Enviable Lifestyle

“Traverse City is a wonderful place for so many reasons,” adds Dr. Lora Higdon, the other co-owner of Autograph, “but the lifestyle on offer here is undoubtedly one of its biggest attractions. With four robust seasons, there’s always something to do. In the summer there’s boating, parasailing, and water skiing. You can go hiking and golfing in the spring and fall. And there are thousands of miles of cross-country skiing and snowmobiling trails to enjoy in the winter.”

“The greater Traverse City area is set along 140 miles (225 km) of Lake Michigan shoreline. International superyachts from as far away as Australia or the Caribbean regularly call here, and it’s a watersport and boating paradise,” says Jay. “There are a dozen small towns nearby that you can visit from the water, spending a day port-hopping. Plus, the sunrises and sunsets across the lake’s different bays are absolutely incredible.”

Sunrise over Traverse City Harbor
Sunrise over the harbor near Lake Michigan's West Grand Traverse Bay in Traverse City. The boating and watersports here create what Lora calls “a hidden paradise that not many people know about.” Image: Getty Images.

That’s not to mention the region’s wealth of championship golf courses (45 to be exact, including several designed by legendary players such as Jack Nicklaus); excellent equestrian offerings; and top wineries (12 in Grand Traverse County) and craft breweries (“a couple dozen” says Jay).

We’re seeing a shift to primary home purchases in Traverse City… buyers have chosen to improve their quality of life by relocating to where they vacation—Dr. Lora Higdon

“Every season is also full of festivals and art shows,” Lora explains. Notable events include the city’s annual Cherry Festival, thanks to its status as the largest producer of tart cherries in the U.S., and the Traverse City Film Festival, which was established by filmmaker Michael Moore—a resident of the city, who has helped to establish it as a magnet for moviegoers.

The area also boasts a vibrant art scene and is home to plenty of top-notch galleries and the internationally renowned Interlochen Center of the Arts, which has provided an education for an array of emerging artists from around the world for almost a century. The city’s newer Crooked Tree Arts Center was founded in 1971 “to provide art to the community at all levels and ages,” Lora says. It hosts events ranging from en plein air painting festivals to exhibits of local works and fundraisers for art-related charities.

A woman painting in Traverse Bay
Along with a yearly roster of exhibitions and sales, the Crooked Tree Arts Center hosts Paint Grand Traverse, a week-long en plein air event held in Traverse Bay. Image: Courtesy Crooked Tree Arts Center

High Demand, High Value

It’s no wonder that Traverse City and its surrounding areas are seeing increasingly high demand for properties—and have been for the last decade, say Lora and Jay.

“The state of Michigan took a long time to recover from the 2008/2009 recession. That has made it very appealing for buyers, as our prices are just now getting back to where they should be,” Jay explains, adding that it’s led to great value for money in the region’s real estate market. “If you look at what $1 million in Northern Michigan can get you—a fine house on the water, with a lake view—compared to what you can buy for the same amount elsewhere in the country, you realize the value is definitely there.”

And how has that appeal held up during the challenges of the last two years? “When the pandemic hit, we expected a stagnant period where people were weighing up their options before making a move,” he says. “Instead, what we saw was a push out of the big cities—Chicago, Indianapolis, L.A., Denver, San Francisco, Houston—with many people wanting a home in a smaller one, such as Traverse City.”

“In previous years, most homeowners here were those with second or third homes,” Lora agrees. “Now, we’re seeing a drastic shift to primary home purchases in this resort area. People realized that they can successfully work remotely, and many have chosen to improve their quality of life by relocating to where they vacation.”

A wooden clad home in Traverse City
Located in downtown Traverse City, this home captures the heritage of the area, while its large entertaining space and two-story garage with room for a boat offer the best in modern lifestyle. It is on the market with Autograph.

“Our company performance is up 200 percent over last year,” Lora continues. “We’ve doubled our staff of agents and brokers. Though inventory is very limited, we have found creative ways to keep in touch with our clients, so we can better understand their housing needs when properties present themselves.”

New Trends

When it comes to top trends in the area’s real estate market, both Lora and Jay point to “lifestyle living all year round. We’re seeing these tremendous outdoor spaces being built with a tennis court or swimming pool, outdoor pizza ovens, and fire features. Inside, we’re seeing great rooms where you can connect with friends and family, and libraries or wine tasting rooms. People have taken stock, and realized that if they can’t travel, they want all these experiences customized right in their own homes.”

And, Lora adds, with the region experiencing high demand and a corresponding lack of inventory, “development is on the rise.” While she cautions that building a home can take longer, and is subject to increasing construction costs, she would advise clients to “buy the land. Even if you can’t build on it right now, hold on to it for a couple of years and build when you can.”

Investment Advice

What other advice do the Higdons have for those looking to buy in the area? “Vacation rental is the best investment opportunity,” they both emphasize, pointing to Traverse City’s historically high occupancy rates of around 98 percent for both vacation and long-term rentals. Autograph also offers bespoke concierge services for those looking to invest in these kinds of properties, with limousine transfers to and from the local airport and activities, such as snowmobiling, offered to holidaymakers.

A waterfront jetty of a home in Traverse City
Surrounded by nature on the Boardman River, this condo is within walking distance of premium dining, shopping, entertainment, and beaches. The home includes direct water access and is available through Autograph.

Their go-to area when searching for such investment opportunities is the Old Mission Peninsula—the heart of the Northern Michigan’s wine industry and a center for tourism. “This has been the focus of the region’s luxury real estate for 50 years,” Lora says. “And 70 miles of Old Mission is a continuation of Traverse City’s downtown foodie scene, with breweries, cafes, fine dining, and quaint markets.”

They also single out Old Town—a fast-growing area near downtown, which offers great biking, walking, kayaking, and canoeing—for the opportunity to renovate or rebuild, and the Commons, a neighborhood known for its century-old state hospital, which has been refurbished to include luxury condos, trendy restaurants, and mixed-used retail and medical offices, all within walking distance to the Lake Michigan waterfront.

“We’re really starting to see these neighborhoods, as well as areas around the city and a little further out, grow in popularity,” says Jay. “Ten or 20 years ago, it used to be the case around here that you could turn the lights off in November and turn them back on in March. But it’s not that way any more, now Traverse City is seeing year-round demand—it’s an all-seasons destination.”

Banner image: An aerial view of Traverse City and Grand Traverse Bay. Getty Images