Q4 Market Report - Under 800k
Total Big Bear Area Market Trends: $0-$800,000 Price Range
The following stats are for the Total Big Bear Area. I have divided the Total Big Bear Area into 10 Sub Areas to give you more detailed information on the area where your property is located. Like most of Big Bear, I have broken up the Total Big Bear Market into two segments Up to $800,000 property value and the Luxury Market over $800,000. This seems to be the most accurate price range to split the market. Every three months, I will post detailed quarterly market trend tables and graphs for each price range with a condensed but easy to understand examination of the market stats. If you want to just get the short version of the market in the Total Big Bear Area you can skip to the bottom and read the Summary.
Market Prices
Table 1 (below) was created from the two year average price monthly graphs for the Total Big Bear Area and the 10 sub areas. Graph 1 below covers the Total Big Bear Area monthly stats. I will be using the table to analyze what trends I see with Real Estate prices in the 0 - $800,000 Market in the Total Big Bear Area. The table and graph have the parameters of: Price Range 0 - $800,000, from January 2021 to December of 2022.
While there will be fluctuations from quarter to quarter The Total Big Bear Area still has a $65,000 (column 8) gain over the last 2 years. This gain was brought up $10,000 (column 5) by a unexpected $10,000 average price increase in December. But I would expect the overall gain from column 8 to be lowered over the next few quarters. Most of the gain was in our Boom cycle. This gain will now continue to go down because we are in a down cycle. We will have to see how long this down cycle will last and how far prices will go down. To see how the prices in the sub areas have done, please refer to Table 1 below or check out the write up on that area.
If you want to know what your Big Bear cabin is worth in this price range in your sub area, contact me to get a more detailed market analysis that takes into consideration the number of Bedrooms, Bathrooms, Square Feet, Lot size, Condition and Views or location.
Sales vs Active Listings (supply and demand)
Table 2 shows what residential real estate inventory changes (Sales vs Active listings) have occurred for the Total Big Bear Area and sub areas. It is made up of monthly graphs for each area. Graph 2 below is for the Total Big Bear Area monthly stats. These stats are compiled by using a parameter of: Price Range of 0 - $800,000 from the 2-year period January 2021 to December of 2022.
You can see from column 5 that sales are down this quarter compared to last quarter by 51 and listings are down by 111. When you look at this quarter compared to the fourth quarter of last year, column 6, sales are down by 49 in this quarter and listings are up by 115. This shows us that economic influences of higher rates and inflation are causing sales to go down which causes more listings on the market. More listings also brings prices down. Given the current economic conditions I would expect the number of listings to go up and sales to continue to decline. Which is what you would expect in a declining market.
Sales vs Expired Listings (strength of Sales)
Graph 3 In the Total Big Bear Area, the sales to expired ratios have been at a good level. With sales and expired listings close to a 1:1 ratio. There will always be expired listings. And a 1:1 ratio is considered a good ratio for a stable market. But in the last two months we are seeing more expired listings which is getting us closer to a 1:2 ratio or higher of sales to expired listings. Which is considered a declining market. This will probably continue for the next few quarters.
Summary
With these numbers we can say that the fourth quarter had a surprising price increase of $10,000. So we still had gain in the equity of cabins that were purchased at least 2 years ago of $65,000. Sales have a steady decline for the quarter. Which has added listings, which along with the economy will put pressure on prices to go down. For vacation homes we are in a declining market. We now know that we are going to stay in this declining market for at least the next few quarters.
Economic data for the fourth quarter and beyond is all pointing to a continuation of a down market.
Expect the graphs for the first quarter of 2023 to reflect a continued slow Real Estate Market.
My opinion is that we are going to see prices continue to fall. Cabins will be on the market longer. Sales will decline. It will take longer to sell cabins and we will have more expired listings because of the sellers who don’t reduce their price.