39408 Point Road, a 3 bed, 3 bath, 2100 square foot, bank owned Big Bear lakefront fixer (some would say tear-down) just closed at a surprising $676,101. This sale price is over $175,000 more than its original list price of $449,000. In my opinion, there are a few insights that can be gleaned from this transaction.
First, it is yet another Big Bear lakefront home sale in a year that has started red hot! Having begun the year with the first quarter accounting for half the total number of sales from the entire previous year, this transaction just keeps the momentum going. At this rate, we will sell more lakefronts than the last two years combined. With the busiest months of the year for buying Big Bear lakefronts still to come, I am hoping we finish the year as strong as we have started.
Secondly, this sale is evidence as to what happens sometimes when out of area agents list Big Bear homes for sale. Not being familiar with the market, particularly the Big Bear lakefront real estate market, out of area agents are not in tune with local values. Oftentimes, these out of area agents do not know the extent to which they should adjust a property's value to reflect its lakefront status. As well, they oftentimes do not have access to the Big Bear MLS from which they would otherwise be able to access more complete and current information on recent lakefront home sales. Ultimately, it is not entirely surprising to see properties get listed at inaccurate prices when there is not a local Big Bear real estate agent involved. This was certanly the case with the Point Road property as it sold for $175,000 more than the original list price.
Lastly, this sale shows how sometimes underpricing a home can ironically result in someone overpaying. Within 24 hours of this property listing, there were at least 5 offers. This multiple offer scenario most likely resulted in a bidding war in which a buyer paid more than the property was worth. (Just my opinion.) Obviously, underpricing and hoping for a bidding war does not work out in the seller's favor more often than not. Otherwise, most sellers would use this pricing strategy. But every once in a while, the emotions that a bidding war frequently evokes will incite buyers to pay more than they had originally planned.
This latest sale, specifically being a lakefront foreclosure selling for top dollar, is more evidence that maybe the market is ready to make a turn for the better. There certainly proved to be several buyers ready to pounce once the right deal presented itself. And when one of those buyers showed confidence on the market by their willingness to pay over $175,000 over list price, this makes me more optimistic than a few years ago when the same listing might have struggled to get an offer anywhere near list price.