Labor Day is a benchmark from where I like to compare consecutive years in the Big Bear Real Estate market. This day marks the end of summer, our busiest season for prospective buyers, as well as it is the two-thirds point through the calendar year.
When you compare the first 8 months of 2011 to those same months this year, you will see some encouraging numbers.
Number of Sales - 553 in 2011 to 720 in 2012 - an increase of 30%
Average Sale Price - $218,000 in 2011 to $235,000 in 2012 - an increase of 8%
Median Sale Price - $157,000 in 2011 to $165,000 in 2012 - an increase of 5%
Average Price/SF - $141 in 2011 to $142 in 2012 - about the same
Median Price/SF - $131 in 2011 to $130 in 2012 - about the same
Home Inventory - 863 Big Bear homes for sale in 2011 at the beginning of September compared to 552 homes in 2012 - a decrease of 36%.
As you can see, sales are up about 30% and the number of homes for sale are down by 35%. An increase in sales and decrease in the number of homes listed are the core conditions that will drive a Big Bear real estate market recovery. Further proof that the recovery is underway is reflected in the price increases and stabilization across all four price measures - average and median sale sprice and price per square foot.
Not only does this appear to be the market bottom that buyers have been waiting for, but when you consider that interest rates are at an all-time low of 3.5%, this may be the opportunity of a lifetime to purchase a home. I don't think anyone could have predicted 5 years ago that Big Bear home prices would fall 45% and interest rates would fall well below 4%.
The difficulty for buyers right now is the lack of home inventory. With the number of Big Bear homes for sale at the lowest level since 2005, it may be more difficult to find a home with all the features you're looking for. With prices and interest rates where they are, you have to be ready to move fast when you find the right property.
I will end with my usual disclosure of admitting that nobody has a crystal ball that can predict the future of Big Bear real estate. That being said, these Labor Day numbers are the most encouraging I have seen since 2006 and certainly suggest that predictable home price appreciation might be in store in the near future.