Big Bear Real Estate Prices Are Falling
In my last writing I expressed my concern about the numbers we were getting at the beginning of May. Unfortunately, things got worse in the second half of May. Let’s look at the numbers and see where we are, and where we may be heading.
Now that May is over, we can get accurate information for the last 3 months and especially May. Let’s look at the two markets, 0-$800,000 and $800,000 and up and see what they are doing.
First 0 - $800,000. When we look at two graphs, we get a picture of Price and the main influences on price, Sales and Listings. Let’s look at the price graph first. The last 3 months we have gone from $492,000 in March to $445,000 in May. For a 10% drop and I don’t think the downward trend has bottomed out. As I wrote in the last newsletter, we needed strong sales in the second half of May, and we didn’t get it. So where are we with Sales and Listings in May?
In May of 2022 we had 77 sales. In May of 2023 we had 73 sales and in May of 2024 we had 44 sales. Which is 29 or 40% less than last year.
In May of 2022, we had 290 listings. In May of 2023 we had 288 listings and in May of 2024 we have 388 listings. Which is 100 or 35% more than last year.
So, what are the damages to prices going to be in this price range? Are we done dropping? The answer to the first question is it depends on the economy and the number of listings that come on the market. The answer to the second question is, we are not done dropping. With listings 35% higher than last year and sales down 43% this has forced the sellers who are currently on the market to lower their prices. When I looked at the listings in this price range 36% of the listings had a price reduction. So how far will prices drop in this price range? Time will tell but I would say at least another 10% more with the possibility of another 20%
Now let’s look at the $800,000 and up Luxury market. When we look at the price graph for this market, we see wide swings of up to $400,000 per month. In this price range it depends on what properties are listed. Are there lakefront properties, properties next to the ski areas or very large properties with a view. So, we never have a price graph that is consistent. In Jan. we had an average price at $1,078,000 in Feb it was $1,060,000 which looked like a downward trend, but March was $1.300,000 and April was $1.600,000 so prices came back because of the luxury cabins that were sold in March and April had special views, features or locations. Now in May we are back down to $1,088,000. So, the price graph doesn’t tell us much. So where are we with Sales and Listings?
In May of 2022 we had 19 sales. In May of 2023 we had 9 sales and in May of 2024 we had 13 sales. Which is 4 more than last year.
As far as listings are concerned, in May of 2022, we had 108 listings. In May of 2023 we had 90 listings and in May of 2024 we have 120 listings. Which is close to the 124 listings in July of 2022 which is the highest amount of listing in a month for the past 2 years.
Has the number of listings affected prices? Maybe. When I looked at the listings in the luxury Market 36% of the sellers had reduced their price. Just like the lower price range. When we get the next 2 months price graphs we will know if the price reductions were just sellers who wanted too much for their cabins to begin with and adjusted their price according to the market. Or have prices in this price range started to go down because of the increase in listings.
I think that if we stay in the 10-15 sales per month range and listings don’t go too high in the next few months, prices in this price range should stay at their current level from the last few months or will go down slightly. Maybe 5-10%. Remember just a few years ago we were lucky to have 3 sales in two or three months in this price range. If listings stay high we could see a correction of at least 20%. The next few months will tell us if this price range will follow the 0-$800,000.
The next newsletter I will go over what sellers and buyers should do in this market.
