Big Bear Real Estate: Luxury Market Continues Slide In Sales
It looks like we are stabilizing in the 0-$800,000 range. And to tell the truth the luxury market has been scary for the past 6 months. But I think there is hope for this market soon. Let’s take a quick look at the overall market for each price range and see where we are.
First the 0 - $800,000 market. It is nice to see prices stabilize for 2 months at $474,000 (See Graph 1) which is up from $440,000 2 months ago which brings us back to what cabins in this price range were selling for in October 2021. We still may get some pressure for prices to go down but the nice thing here is that sales have also stabilized at about 47 per month for the last 3 months (See Graph 2), where last year the same 3 months in an overheated market averaged over 100 sales per month.
Next is the $800,000 + market. If you look at the monthly price graph it looks great with prices going up almost $600,000 from last month (See Graph 3). But as we all know that this price range is very volatile and 3 sales is a very small sample size. So I don’t put much weight on the price increase. Especially since there were only 3 sales last month. Sales are the problem with the fourth graph (See Graph 4). For the last 6 months sales have declined from 17 per month to 3 per month. Remember 3 years ago when there would only be 1-3 sales every other month. And sometimes only 1 sale in 3 months. Some of the downturn in sales is from falling prices. A lot of the cabins that would have sold in the $800,000+ market have had to lower their price to sell. So they are now helping the 0-$800,000 market but not helping the luxury market. I think that prices will still be volatile in the Luxury Market but that by late summer the sales will start to come back. To Summarize.
Basically inflation is dropping in small amounts. Because of this, rates are going to stay too high for the next 6 month. But if you are willing to lower your price as a seller there are buyers. A lot of investors are buying now. This is because they are getting lower prices and will re-finance when rates get to a better level. Maybe a drop of at least 2 percent. Also, it is worth noting that currently there are 28 pending listings with 7 over $800,000.
