Will the rising prices sustain ?

[Rick Sides]

Before I post this , I know people are going to say if people are willing to pay high prices for golf then places will keep raising prices . Was looking at a couple places on internet like ocean course 600 , Bali Hai in Vegas 400, even a local course near me went from 45 to 95 since Covid . My question is eventually do people stop paying these prices ?

[Tommy Williamsen]

I played with a friend of mine today who is quitting the game. He feels priced out at our club and doesn't want to play public golf. April is his last month to play.

[Mike Sweeney]

I sincerely like watching Women's Professional Golf. Tomorrow morning I have a 9:10 am tee time on Long Island and I will be surprised if I see more than a handful of women before 11 am.

I have been on this website for 20+ years and MAYBE we have had 10 women post? I have had only one regular woman golf partner back in the old days. I like playing with women.

Steph Curry's new Junior Golf Tour looks nice https://bleacherreport.com/articles/10033409-stephen-curry-to-launch-underrated-junior-golf-tour-for-underprivileged-kids, but women drive the ship in American households and Golf is recreational for families.

My wife is scheduling many lost trips as we speak, and I was playing awfully good last 2021 season. Golf and my handicap probably peaked in 2021 unless they figure out how to get women to really play.

PS - Running events are now dominated by women (my wife runs and has no interest in golf)... so golf could find a new peak if women jump in.

[Duncan Cheslett]

Before I post this , I know people are going to say if people are willing to pay high prices for golf then places will keep raising prices . Was looking at a couple places on internet like ocean course 600 , Bali Hai in Vegas 400, even a local course near me went from 45 to 95 since Covid . My question is eventually do people stop paying these prices ?

I suspect that the $600 and $400 places will do just fine, but the local course will struggle to sustain the higher price.


Recessions disproportionately affect the common man.

[Jeff Schley]

The rising prices for green fees I don't think are so much the issue, it will be those rising prices (via inflation) the courses have to pay for seed, sand, fertilizer, fuel, etc. That will cause them to push the their fees onto customers, but at municipal tracks that won't be popular and end up showing a loss perhaps in the future. In the 2 years since the pandemic, inflation is probably 15 or so percent at least and higher in some commodities/services. Have green fees risen that much at munis?

[Thomas Dai]

Golf's essentially a simple game .. ball, stick, hole.
If folks reckon costs are too high maybe they should try cutting back on expectations, especially course conditioning and equipment related. And don't get me started on the modern ball and it's interaction with the playing area acreage!
Mini rant over (for now)!

atb

[MCirba]

Mike Sweeney,

I tried to suggest that women are the driving force(s) for the future of golf given the type of family scheduling and monetary planning issues you raised once on another website and almost had my typing fingers taken off.   


Some men apparently think we're still in control.   Hah.

[jeffwarne]

The rising prices for green fees I don't think are so much the issue, it will be those rising prices (via inflation) the courses have to pay for seed, sand, fertilizer, fuel, etc. That will cause them to push the their fees onto customers, but at municipal tracks that won't be popular and end up showing a loss perhaps in the future. In the 2 years since the pandemic, inflation is probably 15 or so percent at least and higher in some commodities/services. Have green fees risen that much at munis?

Hardly the issue-except at basic low end courses which tend to do OK.
Sure 15% cost increases could translate to 15% higher fees, but many clubs/fees have gone up far more than that even in the previous low inflation scenario we were in for many years.

Some golf courses, such as Palmetto and Aiken GC have surprisingly low fees for American courses(in their respective categories), despite having command of the demand issue.
They've just chosen to remain golf clubs, not wedding venues, dining as in "chef" or worse yet "executive chef" ,locker room amenity destinations(who gives a flip about the shower pressure/heads), sub air showcases or any number of short sighted non golf decisions that take the eye off the prize.
Many/most nearby(or anywhere)clubs have double, triple or even quadruple annual fees, delivering less of a golf course and culture-always chasing members and players with extraneous non golf amenities that further perpetuate the issue of frivolous subsidized expense and mediocre golf.


A good recession should put many clubs back on the straight and narrow...or out of the game.

[PCCraig]

It sure seems so. Clubs in town here are all on waitlists. The local city muni down the street is absolutely packed but it only costs a pretty modest ~$45 to walk on the weekends.


The resort prices are nutso, but they're all packed too. Sand Valley is essentially sold out for 2022, and their rack rate is about $300 for the first play or about $1,200 a day with all golf and lodging included.

[Lou_Duran]

A good recession should put many clubs back on the straight and narrow...or out of the game.

I worked in real estate for over 25 years and saw the devastating effect of recessions and flat markets through three cycles.  Anyone who believes in high government spending, high taxes, and unlimited federal debt should be joining whatever club they can afford now before all these "good" things price them totally out.


The growth in north Texas is such that housing prices are going through the roof and golf clubs are raising initiation fees and monthly dues without much resistance.  My dues at a modest private, corporately-owned club just went up 22% this month without a current notice from the owner of the change.  The initiation fee was doubled in the full-member category.  I am aware of two clubs that increased dues, one over 50%, the other by 30%.  Reasons given for the latter, a high-service, wealthy club, is the rapidly increasing cost of labor it must pay to compete for staff, and to a lesser extent, the cost of other inputs.


My gut feel is that in two years we will be where we were near five years ago in golf and home prices, adjusted for inflation.  Some areas like the major cities in Texas are likely to feel less pain, but my bet is that there will be a reckoning.


And it is just not in the U.S.  In the past, it was not unusual for Royal Dornoch to shed (resignations, deaths) 50-75+ members annually.  In the FY 2020-21, nine spots opened up for promotion to full members.  Various opinions are offered as to why the sudden "good fortune" for the club.  Mine is that all the helicopter money dropped by governments in the guise of providing Covid relief allowed on-the-fence members to allocate some of the new free wealth to pay club dues.  I haven't heard what 2021-22 portends, but I wouldn't be surprised if the results are similar.


The real question is what happens when the results of continuing modern monetary and uncontrolled government spending theories come home to roost.  History does not support a happy ending, and golf is certainly a highly discretionary activity.  With women having a great say today on household budgets, can golf get a fair hearing?  I think not.     

[A.G._Crockett]

Over the years, have you seen very many, or any, courses reduce fees?  (I’ll put private club initiation fees in a separate category.)




Courses might offer more “deals”; twilight rates, multi-round passes, lunch or beer, etc.  But the basic rates are unlikely to come down.

[Buck Wolter]

Any golf course input costs going down? Labor, Fuel, Chemicals all much higher -- on the chemicals/fertilizer that is if you can get them at all. To breakeven with last year I would bet they need a 25% increase across the board --maybe higher. Food can at least be adjusted as things go up but how does a private club plan for the increases -- maybe an inflation special assessment?

[Dan_Callahan]

Private courses in New England are so slammed that many, for the first time in their history, have gone to tee times. The very high cost to join, coupled with a packed course, in unappealing to me.


That leaves public courses. A public course needs to be very good before I'll shell out more than $100 to play. When Newport National and Belgrade jacked their greens fees to $150+, they fell off my list.


Having said that, pace of play is a far greater obstacle to my golfing frequency than price. Regardless of how cheap or expensive a course is, if a round is going to take 5+ hours, I would rather just go to the range and putting green. Ironically, the sudden popularity of golf is what has limited my rounds. I won't even try to play on a weekend anymore. I played 9 holes last Friday at a below-average course near me. Teed off at 3:45. Finished 9 holes at 6:15. It was a beautiful day, and I had fun being out there with friends, but we bailed after 9. It was painfully slow, and my experience has been that rangers don't do enough to keep groups on pace. Had that experience in Myrtle Beach, and have had that experience in New England.


A course with an aggressive, assertive ranger seems to be a unicorn these days.

[Bruce Katona]

Much like housing prices, pricing in golf is cyclical.  The Great Recession of 2008 had real estate prices depressed for several years.


On this site alone, we alone bemoaned how there was no interest in golf, courses were closing etc.  Given COVID and golf being a great way to get out of the house and enjoy fresh air, playing golf again is popular.


Given how the financial markets are reacting to the ongoing hostilities in Eastern Europe, one wrong push of a button will put the financial markets into freefall and clip the head off this long bull market.  At that point all of the excess money gained over the past 10 years or so will be gone; golf and the economy will again be in the crapper.


IMHO.

[Steve Lang]

   It doesn't look like the hourly rates at Top Golf have increased...

[Jason Hines]

For those of us in the food industry, we are no where near finished raising prices to cover costs. 


We burn our food for fuel in the U.S., lack of truck drivers, fuel surcharges, supply chain shortages on packaging due to labor, logistics, etc.  That is before we even face the risks of growing a crop.  I would also suggest what is going on today is much "worse" than 2008 as well.


Sure the person with local membership and a national membership won't feel it - but some of their/your customer's customers will have to make a choice on what to spend their income on.

[A.G._Crockett]

Any golf course input costs going down? Labor, Fuel, Chemicals all much higher -- on the chemicals/fertilizer that is if you can get them at all. To breakeven with last year I would bet they need a 25% increase across the board --maybe higher. Food can at least be adjusted as things go up but how does a private club plan for the increases -- maybe an inflation special assessment?

Bingo!




Wages and prices are sticky in a downward direction. (Keynes, I believe?)